ML20211P277
ML20211P277 | |
Person / Time | |
---|---|
Site: | River Bend ![]() |
Issue date: | 10/15/1997 |
From: | Acker L, Mabey R, Murphy M AFFILIATION NOT ASSIGNED, CAJUN ELECTRIC POWER COOPERATIVE, INC. |
To: | |
Shared Package | |
ML20211P274 | List: |
References | |
NUDOCS 9710200136 | |
Download: ML20211P277 (82) | |
Text
_ _ ___ _ - _ ____. - _ _ - _ _ _
e 1
UNITED STA'TES OF AMERICA NUCLEAR REGULATORY COMMISSION
)
fhtheMatterof
)
)
CAJUN ELECTRIC POWER COOPERATIVE, INC.
)
Docket Nos. 50-458
)
and 50-459 ENTERGY GULF STATES, INC.
)
License No. NPF-47
)
(River Bend Station - Unit 1)
)
APPLICATION OF RALPH R. MABEY, CHAPTER 11 TRUSTEE FOR CAJUN ELECTRIC POWER COOPERATIVE, INC.,
FOR TRANSFER AND AMENDMENT OF LICENSE This application is being filed by Ralph R. Mabey, Chapter 11 Trustee (the " Trustee") for Cajun Electric-Power Cooperative, Inc.
(" Cajun") on behalf of Cajun.
Cajun, Entergy Gulf States, Inc., formerly known as Gulf States Utilities Company ("EGSI"), and Entergy Operations, Inc. ("EOI") are the holders of Facilities Operating License No NPF-47 (" License")
for River Bend Station, Unit 1 (" River Bend").
Cajun holds a thirty percent undivided ownership interest in River Bend, and EGSI holds a seventy percent undivided ownership interest.
- EOI, which has no ownership interest in River Bend, operates River Bend as agent for Cejun and EGSI.
Pursuant to 10 C.F.R.
S 50.80, the Trustee hereby requests that the Nuclear Regulatory Commission ("NRC" or " Commission") grant timely confirmation and approval, of the transfer of Cajun's thirty percent ownership 9710200136 971016 PDR ADOCK 05000450 H
J__
. - ~ -
interest in River Bend =to EGSI$
In addition, pursuant to S 50'.90, the Trustee requests-that the license be-amended to reflect the transfer.
_10,C.F.R.
S 50.90.
-In-support of this request,_the Trustee' states as follows:
I.-
BACKGROUND AND PURPOSE OF REQUESTED TRANSFER 1.
Cajun is organized and operated as a not-for-profit power supply cooperative that is wholly owned by a federationLof twelve retail electric-distribution cooperatives serving'approximately one million people in rural Louisiana.
I Cajun and its twelve members are not-for-profit cooperatives under the Rural Electrification Act of 1936, 7 U.S.C.A.
Sections 901_et: seq.
In addition to other generation facilities, Cajun Downs a thirty percent' undivided ownership-interest in River Bend. 2 In 1994; after a two-year-rate investigation,.the Louisiana Public Service Commission disallowed from rate recovery i
2 River Bend is a-boiling water-nuclear reactor and related nuclear powered electric generating facility located
.approximately 2 miles east of--the Mississippi River in West Feliciana Parish, Louisiana, approximately 2.7 miles southeast of-St. Francisville, Louisiana, and approximately-18 miles northwest oof-the city limits of-Baton Rouge, Louisiana.
Construction =of
. River Bend was completed at a cost of approximately $4.4 billion.
River Bend was issued a NRC full power operating license NPF-47 on August 29, 1985.
2'
Cajun's 41.8 billion investment 8 in River Bend.a This action precipitated-Cajun's decision on December 21, 1994 to file a voluntary petition with the United States Bankruptcy Court for the Middle District of Louisiana (the " Bankruptcy Court") for protection under Chapter 11 of the Bankruptcy Code.
On August 1, 1995, the Bankruptcy Court appointed Ralph R. Mabey as Cajun's Chapter-11 Trustee.'
2.
-EGSI, a corporation with its headquarters in Beaumont, Texas, owns the remaining seventy percent interest in River Bend.
EGSI primarily is engaged in the business of generating electricity and transmitting, distributing and selling such energy at retail and wholesale in southeastern Texas and southern Louisiana.
Additionally, EGSI purchases and markets-2 Cajun borrowed the majority of the $1.8 billion to invest in River Bend from the Rural Utilities Service ("RUS") of the United States Department of Agriculture.
3 Egg In Ret A General Examination of the Rates and Charges Assessed by Cajun Electric Cooperative. Inc. to Its Members Distribution Cooperatives, Order No. U-17735-E, 1994 La. PUC Lexis 216, December 16, 1994.
This appointment was confirmed by the United States Court of-Appeals for the Fifth Circuit.
Sgg Cajun Elec. Power Coop.
Inc.
et al.
v.
Central Louisiana Elec. Coop. Inc. et al.,
74 F.3d 599 (5th Cir. 1996).
3
1 natural gas at retail to customers in the Baton Rouge, Louisiana area.
3.
EOI is a wholly owned subsidiary of Entergy Corporation that currently operates nuclear units for subsidiary companies of Entergy Corporation.
The River Bend facility is operated and maintained on behalf of Cajun and EGSI by EOI pursuant to the Operating Agreement dated as of December 31, 1993 between EOI and'EGSI, on its own behalf and on behalf of Cajun,
- and in accordance with the River Bend Ope" ting License.
Pursuant to a Joint Ownership Participation and Operating-Agreement dated August 28, 1979, as amended (the " Joint Ownership Agreement"), EGSI acts as agent for Cajun, and the agreement between Cajun and EGSI provides that they share proportionately in the costs and expenses incurred in the operation of the facility which they jointly own and each receives for their own use and purposes their proportionate share of the output of.the unit.
4.
On August 26, 1996, the Bankruptcy Court issued an order (a copy of which is attached hereto as Exhibit A-1) approving a global settlement disposing of all disputes between Cajun and EGSI.
The parties to the settlement are Cajun, EGSI, 4
q:
5*
Entergy Corporation,5 Jand the RUS.. Under the-terms -of the--
Bankruptcy Court Order, the RUS, as predominate creditor'with-a claim;of security, was granted the options-to take title :to Cajun's 30 percentfinterest in River Bend; to sell the interest
=toia third party; or-to cause'the11nterest to be transferred to
'EGSI=.$ Pursuant to this authority, the RUS has notified the
- Trustee and'other parties'in interest that it has exercised!its-sole discretion and elected-to transfer the Cajun River Bend-
' Interest to-EGSI.
In accordance with the Bankruptcy' Court's i
orders,[the Trustee requests.NRC confirmation'of, and approval;
- for, such-transfer, as well as the appropriate license amendment.
EGSI intends-to treat the acquired 30fpercent interest i
in River Bend as a non-regulated' asset:excludingLfrom wholesale
.or retail: rate determinations the: revenues and.the costs and expenses associated with this interest.
The'information required to be included in,an application to transfer a license pursuant to S 50.80, and
~
relevant incorporated' sections,-SS-50.'33, 50.34 and'50.37, is provided'herein.
Sag, 10 C.F.R.
S 50.80.
The required Ii 1993 EGSI merged with Entergy Corporation Inc.,-which 5
merger resulted in EGSI becoming a wholly owned subsidiary of Entergy Corporation.
5
4 l
L information demonstrates that the requested consent is consistent I
with the applicable provisions of law, regulations, and orders f
issued by the-Commission.
Antitrust information is set forth in Section III, infra.
II.
GENERAL INFORMATION CONCERNING THE SUCCESSOR LICENSEE Section 50.33 requires that certain information regarding the successor licensee be included in this application.
Egg, 10 C.F.R.
S 50.33.
A.
Name of Successor Lice see Entergy Gulf States, B.
Address of Successor Licensee Entergy Gulf States, Inc.
350 Pine Street Beaumont, Texas 77701 C.
Description of Business of Successor Licensee EGSI is engaged principally in the generation,
. transmission and distribution and sale of electric energy and natural gas at retail and wholesale to approximately 600,000 customers across uoutheastern Texas and southern Louisiana.
D.
Organization and Management of Successor Licensee EGSI, organized under the laws of the State of Texas in 1925 is a wholly. owned subsidiary of Entergy Corporation.
EGSI's principal office is located in Beaumont, Texas.
The officers of 6
1
3.-
EGSI,'all of whom are' citizens of the United States, are as-
~follows:
.Name Title
-Address EdwinLLupberger Chairman of the Board 639 Loyola: Ave.
and Chief Executive New Orleans, LA 70113 Officer Jerry L. Maulden Vice Chairman _
425 W.
Capitol Ave.
Little Rock,~AR 72201 John J.-Cordaro President-Louisiana 639 Loyola Ave.
New Orleans,-LA 70113 Karen-R. Johnson President-Texas 919 Congress St.
Austin, TX 78701
-Frank F. Gallaher Group President _and 639 Loyola Ave, j
Chief Utility New Orleans, LA 70113 Operating Officer-Donald C.~Hintz Group President and 1340 Echelon Parkway Chief Nuclear Jackson, MS.39213-Operating Officer Jerry.D. Jackson
-Executive Vice 639 Loyola-Ave.--
President External New-Orleans, LA570113 Affairs and Chief Administrative Officer Gerald'D. McInvale Executive Vice 639 Loyola Ave.
President and Chief--
New Orleans, LA 70113
' Financial Officer-Michael R._Niggli Senior Vice' President- -639 Loyola Ave.
Customer Accounts New Orleans, LA.70113-
' Michael G. Thompson Senior Vice! President, _639 Loyola Ave.
_ General Counsel and New Orleans, LA 70113 Secretary 7
Name Title Address Louis E.
Buck, Jr.
Vice President, Chief 639 Loyola Ave.
Accounting Officc7 New Orleans, LA 70113 and Assistant Secretary C. Gary Clary Vice President-Human 639 Loyola Ave.
Resources and New Orleans, LA 70113 Administration William E.
Colston Vice President 446 North Blvd.
Customer Service Baton Rouge, LA 70802 Shelton Cunningham Vice President 639 Loyola Ave.
Regulatory and New Orleans, LA 70113 Governmental Affairs Louisiana J. Parker McCollough Vice President-State 919 Congress St.
Governmental Affairs Austin, TX 78701 Texas William J.
Regan, Jr. Vice President and 639 Loyola Ave.
Treasurer New Orleans, LA 70113 Laurence M. Hamric Assistant Secretary 639 Loyola Ave.
New Orleans, LA 70113 Christopher T.
Screen Assistant Secretary 639 Loyola Ave.
New Orleans, LA 70113 Steven C. McNeal Assistant Treasurer 639 Loyola Ave.
New Orleans, LA 70113 Lisa L. Mills Assistant Treasurer 639 Loyola Ave.
New Orleans, LA 70113 The directors of EGSI, all of whom are citizens of the United States,-are as follows:
8 l
'?
NameJ
-Address Edwin Lupberger:
639 Loyola Ave.,-New-Orleans, LA 70113 Jerry L. Maulden.
425 W._ Capitol Ave., Little Rock, AR 72101 l
John-J. Cordaro 639 Loyola Ave., New Orleans, LA 70113 Karen-R. Johnson 919 Congress St.,
Austin, TX 78701 Frank F. Gallaher 639-Loyola Ave., New Orleans, LA 70113 Donald C. Hintz 1340 Echelon Parkway, Jackson, MS 39213 Jerry D..Tackson 639 Loyola Ave., New Orleans, LA-70113 Gerald D McInvale 639 Loyola Ave., New Orleans, LA 70113 EGSI-is not owned, controlled, or dominated by_an alien, foreign corporation, or foreign government, nor is it acting as agent or representative of any person in consenting-to filing of this application.
.E.
Licensing Action Being Applied For andLTechnical.
Qualifications 1
Pursuant - to S -50.33 (e), the Trustee requests NRC confirmation of, and approval'for, the transfer of Cajun's thirty percent ownership-interest in River Bend to EGSI, as'well as the appropriate license amendment to reflect the transfer.
As noted previously, EGSI is a' seventy percent owner-of River Bend and_a
.co-licensee of the River Bend license, and has contracted with
.EOI, such that-EOI operates River Bend as the agent of EGSI and 9
y l Cajun-Following'the transfer,-EGSI will be responsible _for providing all funds necessary-for-the safe' operation of River-
~-Bend-pursuant to NRC regulations. LUpon transfer oficajun's-
, thirty percent ownership interest to~EGSI,.EGSI will succeed to i
-allzof the' terms and conditions imposed upon Cajun by the River Bend' Operating. License, as well as certain other permits and licenses _affecting Cajun's interest in River Bend.
This application does=not involve-a request for any change in the design or_ operation of River Bend, nor of ~ t w terms ortcondicions.of the existing license or technical
-specifications.
There will be no change in the number, qualifications, or organizational affiliation of personnel _who
-operate River Bend as a result of the requested license transfer.
There.are no' changes proposed _to the operation oflthe plant or-to theEqualifications of:the-persons or organizations licensed to 7
operate 1t.
F.
Financial Qualifications EGSI is-an-electric utility.
Electric utilities-are
- exempt Tfrom the requirements of S 50.33 (f), and are'not required to submit financial qualification data.
Sag,.10 C.F.R.
S 50.33 (f). =This_isfalso true with respect to applications for license transfer.
Sag, 10 C.F.R.
S 50.80(b).
EGSI will continue 10
toisell power.from' Cajun's thirty percent interest in River Bend taa fund the costs of operation' associated with that interest.
Therefore financial information concerning the transfer is not submitted herewith.
However, as EGSI will become the sole entity responsible for operating and decommissioning expenses for the facility, EGSI will comply with paragraph 2.c.16 of the current license which provides for prior notice to the NRC of any asset-transfer -(excluding grants of security interests and liens) havingfa depreciated book value exceeding one: percent of EGSI's 1
consolidated net utility plant'to its parent company or any other entity.
G.-
-Offsite. Radiological Emergency Response Planning The requested transfer will have no effect on existing, approved ~ arrangements for offsite radiological emergency preparedness-for River Bend.
Sag, 10'C.F.R. S 50.33 (g).
H..
Construction /Conpletion Dates-The River. Bend plant is complete and licensed to operate pursuant to Facility Operating License No. NPF-47.
There are no; proposals to construct or alter River Bend.
Egg,-10 C.F.R. - S 50.33 (h).
11
I.
Regulatory Agencies EGSI is subject to the regulatory jurisdiction of the Louisiana Public Service Commission, One American Place, Suite 1630, 301 N.
Fourth Street, Baton Rouge, LA 70825; the Public Utility Commission of Texas, 7800 Shoal Creek Blvd., Austin, Texas 78757; and the Federal Energy Regulatory Commission, 888 First Street, N.E., Washington, D.C.
20426.
Sag, 10 C.F.R.
S 50.33 (i).
The following trade and news publications circulate in the area in which River Bend is located:
Trade Publications Louisiana Parish Government The Boardman y
Magazine Louisiana School Board Association g
Police Jury Association P.O. Drawer 53217 707 N.
7th Street Baton Rouge, LA 70805 Baton Rouge, LA 70802 Louisiana Municipal Review s
Louisiana Municipal Association 700 N.
10th Street Baton Rouge, LA 70802 News Publications State Times /Mornino Advocate Baker Observer P.O.
Box 588 5240 Groom Road Baton Rouge, LA 70821-0588 Baker, LA 70714 St. Francisville Democrat Beaumont Enterprises P.O.
Box 1876 380 Walnut Street St. Francisville, LA 70775 Beaumont, TX 77701 12
Zachary Plainsman Alexandria Town Talk 5145 Main Street, Ste. C P.O. Box 7558, Main & Washington Zachary, LA 70791.
Alexandria, LA 71301 West Side Journal Houma Courier & Terrebonne Press T.O. Box 260 P.O.
Box 2717, 312 School Street Port Allen, LA 70767 Houma, LA 70361 RgDham Springs News Lake charles American Press P.C. Box 1529 P.O.
Box 2893, 327 Broad Street De' sham Springs, LA 70727 Lake Charles, LA 70401 Pointe Coupee Banner Natchitoches Times P.O. Box 400 904 Highway 1 S.
New Roads, LA 70760 Natchitoches, LA 71457 Hammond Star Shreveport Times 725 S. Morrison Blvd.
P.O.
Box 30222, 222 Lake Street Hammond, LA 70403 Shreveport, LA 71130 Monroe News-Star / Monroe World Lafayette Advertiser P.O.
Box 1502, 411 N. 4th Street P.O.
Box 3268, 221 Jefferson St.
Monroe, LA 71210 Lafayette, LA 70502 J.
Restricted Data This application does not contain any restricted data or other defense information.
Sag, 10 C.F.R.
SS 50.33 (j) and 50.37.
K.
Decommissioning Information The transfer of Cajun's River Bend interest to EGSI will not effect any change in the current commitments respecting the availability of funds to decommission the River Bend nuclear reactor submitted for the facility.
Egg 10 C.F.R.
SS 50.33 (k) and 50.75.
Cajun had established a decommission ng trust fund 4
13 l
under applicable NRC guidelines.
In its August 26, 1996 Order approving the global settlement, the Bankruptcy Court approved a formulation of the establishment of new decommissioning trust arrangements in satiefaction of all of Cajun's River Bend decommissioning obligations.
Pursuant to the Bankruptcy Court's Order, Cajun will establish a decommissioning trust fund in the amount of $125 million (in 1995 dollars).
This fund will consist of Cajun's new contribution, as well as the amount in Cajun's existing decommissioning trust fund, and is a prepayment of all anticipated future decommissioning costs as specified in Article 1(a) of the Settlement Term Sheet, i.nd as such terms were approved by the Bankruptcy Court's August 26, 1996 Order, which Order was affirmed by the United States Court of Appeals for the Fifth Circuit in Case No. 96-30985, on August 5, 1997.
As approved by the Bankruptcy Court's August 26, 1996 Order, the establishment of this trust fund in connection with the transfer of Cajun's thirty percent interest in River Bend will dispose of all of Cajun's responsibility for River Bend decommissioning costs.
The $125 million payment satisfies the minimum funding requirements set forth in 10 C.F.R. S 50.75 (c).
Evidence of satisfaction of Cajun's decommissioning trust fund obligations 14
c will be made available upon the transfer of Cajun's River Bend interest to EGSI.
Upon the transfer to EGSI of Cajun's thirty percent interest in River Bend, EGSI will assume Cajun's obligations for decommissioning, as defined in the Term sheet shown as part of Exhibit A-1 hereto.
III.
ANTITRUST CONSIDERATIONS The operat.'.ng license for River Bend contains antitrust conditions with which EGSI must comply.
Sag 10 C.F.R.
S 50.33 (a).
Gulf States Utilities Company underwent an antitrust review before issuance of the construction permit and antitrust license conditions were attached to the Gulf States Utilities Company Operating License that still apply to EGSI.
See River Bend Operating License, Appendix C, as amended.
Thus, the application in this case does not involve a new owner or a licensee that has not undergone an antitrust review by the NRC.
Under the Atomic Energy Act, no further review by the NRC is authorized.
No "significant change" with respect to antitrust considerations has occurred or will result from the proposed amendment and statutory review pursuant to 10 C.F.R. S 2.101 (e) is not required.
15 I
4 IV.
TECHNICAL INFORMATION This application to amend license does not contemplate any construction or alterations to River Bend or the-operations thereof.
In addition, the application does not involve a request for any change in the design or operation of River Bend, nor any change in the terms and conditions of the existing license or technical specification.
Consequently, the requirements of S 50.34 are inapplicable and are not addressed in this application.
See,.10 C.F.R.
S 50.34.
V.
AMENDMENT REQUESTED pursuant to S 50.90, Cajun also requests that as part of the transfer of Cajun's River Bend interest, the River Bend License be amended to remove Cajun as co-licensee.
Egg, 10 C.F.R.-S 50.90.
VI.
NO-SIGNIFICANT HAZARDS CONSIDERATION DETERMINATION The propcsed license change involves no significant hazards consideration as defined in S 50.92(c).
Egg 10 C.F.R.
S-50.92(c).
The No Significant Hazards Consideration Evaluation
'is Attached.as Exhibit A-2.
VII.
ENVIRONMENTAL IMPACT DETERMINATION The requested licensing action will have no environmental impact.
It is not necessary to prepare an 16
environmental impact statement or environmental assessment pursuant to SS 51.20 et seq.
Sea 10 C.F.R.
SS 51.20 et seg, The proposed amendment will not result in any change in the types, or any increase in the amounts, of any effluents that may be released offsite, and there will be no increase in individual or cumulative occupational radiation exposure.
Accordingly, pursuant to S 51.22 (c) (9), the proposed Operating License amendment is excluded from the need for an environmental assessment or an environmental impact statement and special circumstances do not exist to otherwise require such an assessment or statement.
- Sag, C.F.R. S 51.22 (c) (9).
VIII.
CONSENT Pursuant to S 50.80(b), EGSI, as co-licensee and proposed successor of Cajun's thirty percent ownership interest in River Bend, and EOI as co-licensee, consents to the transfer of Cajun's interest in River Bend under the terms and conditions set forth herein.
Sag, 10 C.F.R.
S 50.80(b).
IX.
EFFECTIVE DATE There are compelling reasons for the parties to complete the transfer as soon as possible.
On August 26, 1996, the Bankruptcy Court approved a settlement, which, among other things, authorizes Cajun to transfer its thirty percent interest 17
-to-EGSI, subject to certain conditions.
On May 29, 1997, the Bankruptcy Court issued an order in connection with the April 24, 1997 Trustee's filing of a' Motion to Sell River Bend Interest Free and Clear and to Assume and Assign Executory Contracts.
That Order and the underlying purchase and sale agreements require a closing not later_than December 31, 1997.
Final Orders approving the-transfer of the license must not be subject to condition, qualification or requests for rehearing, reconsideration or otherwise in question.
A copy of the Trustee's' Motion and the Court's Order is appended hereto at Exhibit A-3.
The disposition of Cajun's interest in River Bend is an integral component of the ultimate reorganization of Cajun.
X.
REQUEST FOR EXPEDITED CONSIDERATION The Trustee requests that the NRC review this request on a schedule that will permit final action to be taken as promptly as possible and in any event no later than November 30, 1997.
XI.
COMMUNICATIONS REGARDING APPLICATION It is requested that all communications pertaining to this application be sent to:
18 i
I
\\
Lawrence G.
Acker Mary A. Murphy LeBoeuf, Lamb, Greene & MacRae, L.L.P.
1875 Connecticut Avenue, N.W.
Washington, D.C.
20009 (202) 986-8000 counsel for Ralph R.
Mabey.
Chapter 11 Trustee for Cajun Electric Power Cooperative. Inc.
At the request of counsel for Entergy Operations, Inc.
and Entergy Galf States, Inc., the Trustee also requests that the fellowing receive communications pertaining to this application:
Michael G.
Thompson Senior Vice President & General Counsel Entergy Corporation 639 Loyola Avenue, 26th Floor New Orleans, Louisiana 70113 Margaret H. Williams Douglas E.
Levanway Wise Carter Child & Caraway P.O. Box 651 Jackson, Mississippi 39205 Counsel for Entergy Operations. Inc.
and Entergy Gulf States Inc.
Tom F.
Phillips, Esq, Taylor, Porter, Brooks & Phillips 451 Florida Street, 8th Floor Baton Rouge, Louisiana 70821 Counsel for Entergy Gulf States. Inc.
19 l
l
XII.
REQUEST FOR NRC ACTION WHEREFORE, the Trustee requests that the Commission approve the transfer of Cajun's River Bend interest to EGSI, as well as the requested license amendment, and find that the transfer is consistent with the standards and requirements of the Atomic Energy Act of 1954, as amended, and the Commission's Rules and Regulations, and that upon the transfer Cajun should be relieved of any and all obligar'ons arising from any regulations of the Commission.
20 l
Respectfully submitted,
$YW -
Ralph R. Ma' bey, " Chapter 11 Trustee for Cajun Electric Power Cooperative, Inc.
Lawrence G. Acker Mary A. Murphy LeBoeuf, Lamb, Greene & r4acRae, L.L.P.
1875 Connecticut Avenue, N.W.
Washington, D.C.
20009 (202) 986-8000 Dated:
10/15, 1997 21 1
- 2. :
. STATE OF UTAH
)-
) ss:
' COUN'"Y OF SALT LAKE )
AFFIDAVIT OF RALPH R. MABEY Ralph R. Mabey, being dr.ly sworn, states that he is the Court-appointed Chapter-11 Trustee for Cajun Electric Power Cooperative, Inc.; that he is-authorized on the part of Cajun Electric Power Cooperative,-Inc., to sign and file with the Nuclear Regulatory Commission the foregoing Application;-and that Esaid Application is true and correct to the best of his knowledge, information and belief.
Y
/
Ralph R. Mabey r Chapter 11 Trustee for Cajun Electric Power Cooperative,.Inc.
Subscribed and sworn to before me, a Notary Public, this -/ / A day of. October, 1997.
r,
- NOTARY PUBLIC
'6 gi j]' _' A' *" o -]* -
- M f.!SA H. DATEMAN Nobary'. Public 9/
MyComnussionExp4tes tse see usin etoco I,. Salt Lake Qty, Utah 4410.
i
- g ' "./
April F,2001.
s.
STATE OF UTAH
S
.O EXHIBIT NO. A-1
IN THE UNITED STATES BANKRUPTCI COURT FOR THE 1%fDDLE DISTRICT OF" LDUISIANA FILED
)
CIVIL ACTION In re:
g7 NO. 94-2763-52 CAJUN ELECTRIC POWER
)
BANKRUPTM CASE COOPERATIVE, INC.
y sunsett cLEAK NO. 94-11474 m g gs4 T,).,. g Debtor.
)
Chapter 11 Federal Tax Id. No.:
72-0655799
)
)i ORDER AND JUDGMENT APPROVING SETTLEMENT BY AND AMONg CAJUN ELECTRIC POWER COOPERATIVE. INC.. ENTERGY GULF STATES. INC.. ENTERGY CORPORATION. AND THE RURAL UTILITIES SERVICE OF THE DEPARTMENT OF AGRICULTURE This matter coming to be heard on the Motion (the ' Motion") of Ralph R. Mabey, Chapter 11 Trustee (the ' Trustee") pursuant to Rule 9019 of the Federal Rules of Bankruptcy Procedure to approve a settlement between Cajun Electric Power Cooperative, Inc.
(* Cajun" or the
- Debtor") and Entergy Gulf States, Inc. formerly known as Gulf States Utilities Company (*GSU"), in accordance with the terms set forth in the Settlement Term Sheet, dated May 2, 1996, executed by the Trustee, GSU, and Entergy Corporation
("Entergy")
and recommended for adoption by the Rural Utilities Se.rvice of the United States Department of Agriculture (the
'RUS")
(the
' Settlement Term Sheet," a copy of which is attached hereto as Exhibit A), the' Motion, and this order (the ' settlement");
Upon consideration of the Motion, due and proper notice having been provided thereof to parties entitled thereto, and on the basia of the record of this case, including the evidence presented at the hearing on the Motion to approve the Settlement, the litigation
s e
involving the parties described in the Motion and attachments thereto (and the Court having taken judicial notice of litigation Pending before it),.=-d :n th; 5::i; ef th: "ind i :- ^ * *= ~* nd Com-' "-i n n; ef :.
.r.t ;. ;. d
- .;;.;pe.c...e;;17 h r-"i*h
'rh se d *i.iti; a
.d th; defi;.iti-... v.' tL. 3. ul===uu
. e ;-- rh:-* =ve in-ag :r_ted hm.lu uy
.Z.;; :: and' the Court's oral Findings of Fact and Conclusions of Law on the record on August 26, 1996, which are incorporated herein by reference and a transcript of which shall be filed by the Trustee as soon as practicable, and pursuant to 511 USC 105(a) and 363 (b) and Federal Rule of Bankruptcy Procedure Rule 9019(a);
The Court having considered all objections not withdrawn (the
' Objections") to approve the Settlement and to this Order and Judgment (hereinafter, the " Order");
The Court is of the opinion that the Motion is meritorious; accordingly, P
IT IS ORDERED, ADJUDGED AND DECREED THAT:
1.
The relief requested in the Motion is granted.
2.
The Settlement is approved.
3.
All Objections are denied with prejudice.
F 4.
The Settlement as approved includes, but is not, limited to:
a.
A global settlement of all disputes between GSU and Cajun which will result in a reciprocal dismisstl with prejudice of all claims and counterclaims and a general release of any liability 2
of any kind arising out of the transactions or occurrences upon which the presently litigated matters are bcsed; b.
A global settlement of all disputes between GSU and RUS which will result in a dismissal with prejudice of all pending litigated matters in which the RUS har intervened and a judgment'in favor of RUS on GSU's subordination complaint against the Rust c.
A settlement of certain disputes between RUS and Cajun including all matters related to the River Bengt nuclear power facility
(" River Band") including a release and waiver of all claims and causes of action, whether known or unknown, by Cajun against RUS for eq able subordination, all claims and causes of action by Cajun aga t RUS for " lender liability," and all claims alleging waiver of deficiency judgment rights under Louisiana R.S.
13:4108.1.
5.
The Settlement as approved does not resolve claims between RUS and Cajun not involving River Band unless dealt with in the Settlement.
J.
The terms and provisions of the settlement which are intended to apply prior to the closing of the settlement (the
' Consummation Date") shall be binding, effective, and enforceable against each of the Trustne, GSU, Entergy and the RUS at of the date hereof.
The terms and provisions of the Settlement which are intended to apply on and af ter the consummation Date shall be binding, ef f ective and enforceable against each of the Trustee, GSU, Entergy and RUS as of the Consummation Date.
3
- 1.
The Trustee is authorized to set aside in a
decommissioning trust fund or other appropriate vehicle the sum of
$125,000,000 in 1995 dollars.
When the Trustee acts pursuant to this authorization, he shall transfer the f ands in Cajun's o/. sting decommissioning trust fund and will use funds on hand to make up the difference.
The funds on hand used to mske up the difference, which may be funds subject to the order concerning Uso of Cash Collateral to substitute Cajun's *1996 Budget" for all refer:nces in said Order to Cajun's *1995 Budget" (Docket No. 1536), will be transferred free and clear of any lien, claim or other interest asserted by any party. Moreover, the transfer of these funds shall not result in a transfer of any party's lien on, claim against, or other interest in these funds to other assets of Cajun or its estate, and shall not create rights or claims in any party against any other party or against the assets of Cajun or its estate. The transfer cf these funds is a necessary and proper expense of Cajun's estate, and no party shall thereafter assert any rights, except as granted herein, relating to these funds, including any claims that the funds were cash collateral, were not property of the estate, were subject to refund or repayment, were subject to actual or constructivt trust, or were subject to an equitable lien.
This prohibition on the assertion of rights is not a ruling on, and shall not preclude the assertion of, claims that other funds not transferred into the decommissioning trust fund or other appropriate vehicle are cash collateral, are not property of the estate, are subject to refund or repayment, are subject to actual 4
or constructive trust, or are subject to an equitable lien, except
(
insofar as such claims relate to or rely on the transfer of the funds into the decommissioning trust fund or other appropriate vehicle. The funding of the trust fund, together with the transfer of the Cajun River Band Interest (the- ' Cajun River Send Interest
- as that term is defined in the Term sheet) will absolve Cajun, its member cooperatives, and any successor to assets, other than the Cajun River Band Interest, now owned by Cajun (but not others who f
may' succeed to the ownership of the Cajun. River send' Interest) of all cesponsibility for River Bend Decommissioning Costs (as that term is defined in the Term Sheet).
8.
The Trustee is authorized without the necessity of any further order or approval of this Court, to transfer all assets as provided in the Settlement, including but not limited to the Cajun River Bend Interest, Cajun's interest in River Band fuel and spara parts (under the option provided for in the Term Sheet),
Transmission lines 745 and 746 (provided, as required by the Term Sheet, that Entergy's Network Service Tariff and its Transmission Service Tariff, under which Cajun receives service, makes the continued ownership of the Transmission Line or Lines by Cajun or the transferee of its generating assets unnecessary for tajun or its transferee's provision of current or future services by reason of the benefits provided under the new tariffs), and any other ansets required by the Settlement, free and clear of any lien or other interest asserted by any party.
5 t
9.
RUS is authorized to receive from GSU and Cajun Cajun's share of all cash payments resulting from the litigation presently l
l being conducted against General Electric in connection with claims alleging River Band design defects. Cajun's share of all payments in kud and other non-cash consideration received or promised as a result of the litigation anall be paid to the owner of the cajun River Bend Interest at the time such payments in kind or other non-cash consideration become due. All of such transfers and paym6ntA shall be free and clear of any lien or other interest asserted by any party.
10.
The Trustee is authorized and directed, without the necessity of any further order or approval of this Court, to take any and all actions necessary or appropriate to implement, effectuate, and consummate the Settlement and any transactions contemplated thereby or by this
- order, including, without limitatien, the issuance, execution and delivery of any document, certificate, agreement or instrument, the filing of any pleading, and the transf er or other disposition of any assets.
No action or approval of the Board of Directors of Cajun shall be required with respect to the implementation and consummation of the Settlement.
11.
Without limiting the generality of the foregoing, between the date hereof and until and including the Consummation Dates a.
the
- Trustee, and
- GSU, Entergy, and
- RUS, as necessary, shall undertake any and all such actions as are necessary or appropriate to cause the 6
Consummation Data to occur no later than June 1,
19971 b.
the Trustee shall cause Cajun to cease prosecution of all of its objections to any and all relief l
sought by GSU or
- Entergy, or any of their affiliates, in any regulatory or administrative l
proceeding in which approval of the merger of Entergy and GSU is sought, including any related appellate proceedings to the extent that Cajun's objection to such relief is intended to be settled l
or resolved on or prior to the Consummation Date in accordance with the tems of the settlement; c.
the Trustee, with the intervention of GSU, if
- required, shall cause to be stayed all civil actions and regulatory and acministrative proceedings, other than proceedings which are the subject of paragraph 9(b) of this Order, which are i
pending between Cajun, on the one hand, and GSU or Entergy, on the other hand, including any related appellate proceedings, and which are intended to be settled or resolved on the Consummation Date in accordance with the terms of the Settlements d.
the
- Trustee, and
- RUS, GSU, and
- Entergy, as necessary or appropriate, shall undertake such actions as are necessary or appropriate to cause the disposition of the Cajun River Bend Interest on 7
-n--
l I
the consummation Date in the manner provided in section 1 of the settlement Term sheet, and will cooperate to effect, at the option of RUs, the disposition of the cajun River send Interest before the consummation Date subject to consent of the' parties and further court order as provided in paragraph 13 belows e.
the Trustee and osU, jointly or singly, shall undertake to obtain all, regulatory approvals reasonably considered to be required to implement, consummate, and effectuate the settlement (the
' Regulatory Approvals"); and f.
the Trustee, GSU, Entergy, and RUS shall undertake all such other necessary or appropriate actions as are intended to occur prior to the consummation Date in accordance with the terms and provisions of the settlement Tern Sheet.
12.
As soon as practicable af ter the conditions precedent to the closing of the settlement, as contained in the Settlement Term sheet, shall have been satisfied or waived by the affected party or parties, the Trustee, GSU, Entergy and the RUS shall cause the closing of the settlement to occur.
13.
The preliminary injunction in the Service Water Intigation will be continued in full force and effect until the consummation Date, as set forth 'in section 3 (b) of the settlement Term sheet.
8 O
14.
If the consummation Date has not occurred by the close of business on June 1,1997, the Trustee, GSU, Entergy and the RUS may by agreement continue t.o undertake to implement, effectuate and consummate the Settlement.
- However, in the absence of an agreement, any of the parties may move the Court to order the extension of the Consummation Date upon hearing and finding that the Settlement will likely be effectuated within a renconable time upon the tems set forth in the Settlement Term Sheet and that such extension is in the best interest of the estate.
15.
The settlement may not be modified by any Plan of Reorganization in this bankruptcy case except as may be agretd to by the Trustee, GSU and the RUS.
The terms of the Settlement shall be binding upon any successors to the parties thereto, including, without limitation, any purchaser of Cajun or Cajun's assets.
16.
RUS is now authorized to seek a purchaser for the Cajun River Bend Interest (as defined in the Motion and the Settlement Term Sheet).
In the event that a purchase offer that is acceptable to RUS is received prior to the closing of the settlement or to the receipt by the parties of all regulatory approvals required by the Settlement, the Trustee, with the consent of RUS and GSU, may submit a motion for early approval of the sale of the Cajun River Bend Interest on tems that protect the interests of the parties to the Settlement under the Settlement Term Sheet.
17.
Each of the actions taken, documents executed, and payments and transfers of assets made pursuant to provisions of the settlement and order shall be valid, binding and enforceable and-9
not preferential, fraudulent or an otherwise avoidable transfer under the Bankruptcy code or unde-applicable law of the United l
States or any state, province or other jurisdiction, and will, to the ful.lest extent permitted by the Bankruptcy code, vest in the transferee good title to such property, free and clear of all liens, claims, and encumbrances, except as otherwise provided in the settlement, and shall not be subject to modification in any i
Plan of Reorganization in this bankruptcy case, except as agreed by the parties receiving thu benefit under this settlement.
18.
The record of the hearing to approve the settlement is closed.
19.
This order shall be of f active according to its terms upon the entry thereof.
20.
This is a final order and immediately subject to appeal.
Baton Rouge, Louisiana, this
./4, day of h d
, 1996.
^
w UNITED STATES DISTRICT JUDGE STkt,4.gtu EOD __afrv/gs NOME MAILED Tgsgina Callihan On 8/27/96 David S. Rubin Ralph R. Mabey Tom Phillips Brian Jackson Office of the U.S. Trustet g
O t
4 e
4 EXHTRIT A
SETTLEMENT TERM SHEET i
WHEREAS Cajun Electric Power Cooperative, Inc. (Cajun)
,operating through its Chapter 11 Trustee, Ralph R. Mabey (Trustee), Rural Utilities service of the United states Department of Agriculture (RUS) and Ou13 states Utilities (GsU) desire to resolve longstanding disputes and disagreements respecting various issues including operation and ownership of Cajun's undivided thirty per cent interest in the River Bend nuclear f acility (the Cajun River Bend Interest), the Trustee and GsU desire to establish mutually favorable business relationships and Trustee, RUs and GsU desire to arrange for the transfer of certain specified assets, the inastee, RUs and OsU. agree to the terms and provisions set forth herein (the ' settlement"),
recognizing that various of the components of these terms and provisions may require approvals of regulatory agencies to complete and may require more formal documentation to be executed at a closing of the settlement in order to give full effect'to the intentions of the parties set forth herein:
1.
Disposition of River Band (a) on or before the closing of the settlement, Cajun will set aside in a decommissioning trust fund or other appropriate vehicle the sum of $125,000,000 in 1995 dollars.
This fund will be made up of Cajun's new cca ribution, and the amount in Cajun's existing decommissioning trust fund (the " Trust Fund').
The establishment of the Trust Fund, together with the transfer of the Cajun River Bend Interest as provided herein will absolve Cajun and any successor to assets, other than the Cajun River Band Interest, now owned by Cajun (but not others who may succeed to the ownership of the Cajun River Band Interest) of all responsibility for River Band Decommissioning Costs as defined below.
" Decommissioning
- means all actions taken to render the River Band nuclear power plant permanently inactive, inoperable and free of radioactive materials.
The term deconunissioning is intended to be comprehensive and C
include, without limitation, the entombment, decontamination, dismantlement, removal and disposal of structures, systems and components of the River Band nuclear power plant in order to permanently cease the nuclear generation of electric energy, including all actions necessary to bring the plant site to
- greenfield* status and any other item included in a study accepted and approved by regulatory authorities of competent jurisdiction as a basis for the termination of operations under the license to own or operate River Band.
The-term also includes preparation for decommissioning, such as engineering and other planning activities, and all associated activities to cal the amt 14tLt hWm% t.Uepa 1
be performed after the actual dismantlement occurs, i
such as physical security and radiation monitoring.
The term also includes activities associated with spent fuel storage, disposal, transfer, transportation and removal and low level waste storage as well as cajun's future obligations with respect to decontamination and decommissioning of DOE's uranium enrichment facilities.
Also included is the preparation of studies and supporting documentation required by regulatory authorities.
The foregoing specification is not intsnded to form a basis for excluding any action or cost legitimately part of decommissioning and returning the site to
- greenfield* status because of the failure to separately identify or to fall within a category specifically identified.
" Decommissioning costs
- means ' he funds expended to t
perform Decommissioning.
The term includes expenditures whether they are treated as capital items or expensa items for regulatory, financial, or tax accounting purposes.
(b)
The Trust Fund may be used only for the prudent expenditure of Decommissioning costs for the cajun River Band Interest.
If, upon the completion of Decommissioning of the River Send piant, ths Trust Pund, and such additional amounts as have been added to it as a result of the investment and management of funds included therein, is not exhausted W the prudent expenditure of Decommissioning costs for the cajun River Bend Interest, the remainder will be remitted to RUS.
(c)
Upon the transfer of the cajun River Bend Interest.
Cajun shall deliver title thereto free and clear of all liens and encumbrances except those agreed to by the purchaser.
In the event the Cajun River Band Interest is transferred to RUS, its liens and encumbrances on the Cajun River Band Interest shall be merged with the title which it obtains.
In the event the Cajun River Band Interest is transferred to any other person, RUS will release all of its liens and encumbrances on the cajun River Band Interest.
The foregoing releases by
- RUS shall not be construed as a waiver 'or release of the portion-of RUS's claims against Cajun which remain unsatisfied by the transfers of title for which provision is made herein.
Notwithstanding RUS's release of liens on the Cajun River Band Interest or the merger of title if the cajun River Bend Interest is transferred to RUS, the amount of RUS's claims against cajun nhall be reduced only to the extent of RUS's receipt of proceeds from the sale of the cajun River CAJ that cat 3B IMLt 4W3ME LLFtym 2
Bend Interest.
If the Cajun River Band Interest is transferred to GSU under paragraph 1(f) below, the amount of RUS's claims against Cajun shall not be reduced on account of the transfer of the Cajun River Send Interest.
The parties hereto agree that any disposition of the Cajun River Bend Interest under the settlement shall be considered commercially reasonable.
(d)
In the sole discretion of Rus, the Cajun River Band Interest will be transferred under one of the two options or subparagraph (f) set forth below.
In connection with such transfers, Cajun will satisfy the obligation to fund the Trust Fund required by paragraph 1(a) and OSU will make available to all prospective purchasers records, personnel and facilities such that prospective purchasers can conduct an appropriate due diligence-evaluation before making-their bid.
Gs0 may subject the examination of personnel, records and facilities to reasonable confidentiality and business requirements.
RUS shall have substantial flexibility in exercising its discretion to arrange for the transfer of the Cajun River Bend Interest.
In furtherance of that end, RUs's flexibility shall include, but shall not be limited to, negotiating with and selecting a prospective purchaser, being permitted to establish a reserve price which must be met before consummating a sale at auction, not being required to accept the highest bid received at an auction and taking title to the Cajun River Band Interest itself for subsequent reconveyance.
Option 1 The Cajun River Bend Interest and Cajun's interest in River Send fuel and spare parts will be sold, with not proceeds remitted to RUS.
The purchaser will become obligated to fully comply with the Cajun NRC license requirements, all other applicable laws and regulations and the provisions of the River Bend JOPOA, as amended in the respects described in F.xhibit No. 1, coassencing with the date of the transfer of the Cajun River Band Interest.
The Big Cajun No. 2, Coal Unit 93 JOPGA will also be similarly amended, as may be required.
All of Cajun's interest and obligations under the River Bend JOPC A, the NRC license and any recorded documents of transfer between Gsu and Cajun relating to River Band will be canceled and terminated as to Cajun and, subject to the provisions in this paragraph, will be assumed by the purchaser.
Rs used herein, the obligations under the River Bend JOPOA for which a successor shall be obligated shall be limited to obligations for operations commencing with the closing of the settlement and for fuel and spare parts-CAJ that RIr1814tLi oman nw.
3
purchased only after the closing of the Settlement and i
shall not include unfulfilled or unpaid obligations which Cajun incurred while it was still the owner.
GSU may elect to become a bidder if RUS elects to conduct an auction under this option.
Option 2 The Cajun River Bend Interest and Cajun's interest in River Bend fuel and spare parts will be transferred to RUS which will become obligated to fully comply with the Cajun NRC license requirements, all other applicable laws and regulations and the provisions of the River Band JOPOA, as amended in the respects described in Exhibit No. 1, commancing with the date of its succession to the Cajun River Band Interest.
The Big Cajun No. 2, Coal Unit 83 JOPOA will also be similarly amended, as may be required.
All of Cajun's interest and obligations under the River Bend JOPOA, the NRC license and any recordad documents of transfer between GSU and Cajun relating to River Bend will be canceled and terminated as to Cajun and will be assumed by RUS.
As used herein, the obligations under the River Bend JOPOA for which RUS shall be obligated shall be limited to obligations for operations commencing with the closing of the Settlement and for fuel and spare parts purchased only after the closing of the Settlement and shall not include unfulfilled or unpaid obligations which Cajun incurred while it was still the owner.
(e)
RUS will receive from GSU and Cajun Cajun's share of all cash payments resulting from the litigation presently being conducted against General Electric in connection with claims alleging River Bend design defects.
Cajun's share of all payments in kind and other non-cash consideration received or promised as a result of the litigation will be payable to the owner of the Cajun River Band Interest at the time such payments in kind or other non-cash consideration become due.
The same allocation shall be made between RUS and a transferee of the Cajun River Band Interest of refunds or other benefit related to the payment by Cajun to the U.S. Government to fund the decontaminating and decommissioning of DOE's uranium enrichment facilities.
(f)
In the event that no offer is accepted by RUS under Option 1 above and in the further event that RUS elects not to become the transferee of the Cajun River Band Interest under Option 2 above, the Cajun River Bend Interest, together with Cajun's interest in River Bend CAJ IMC WL 1418.8 wma sut,e 4
fuel and spare parts, will be transferred to osU with no payment by GSU to Cajun's estate or to RUs.
2.
Transmission and Certain Other Issues (a)
Pursuant to existing FERC decisions, the claim due osU for past transmission services under the Croc credits and QTF Dockets amounts to $55,000,000 (the ' Liquidated Transmission Debt *).
The Liquidated Transmission Debt consists of $32,000,000 due under the QTF Docket and
$23,000,000 due under the cioc credits Docket.
ose waives its right to collect the Liquidated Transmission Debt from cajun.
9,,,,,,,
,,,,,,, 9 (b) cajun or cajun's transferee or transferees of its generation assets will receive transmission services under Entergy's Network service Tariff and Entergyf s'*.'N Transmission service Tariff as of the later of (1) twelve months from the date of the Settlement or (ii) the date of the closing of the settlement.
Neither Gs0 nor Entergy will oppose the entitlement of Cajun or such transferee to service thereunder or its effectiveness at such date.
All previous transmission agreements existing between (c)
Cajun and Entergy, GsU, LPG or MPE will be tierminated 'D upon the commencement of services described in ptragraph 2 (b) hereinabove.
Cajun will use its best efforts to obtain agreement from its distribution co-ops to be bound by the terms and provisions of Entergy's Network Service Tarifr, during the time they receive service over facilities to which such tariff is applicable.
(d)
Cajun or its transferee under a plan of reorganization-will retain ownership of its BC1 and BC2 switchyards and its Through Bus facilities, cajun will transfer to GSU its ownership of.edch of Transmission lines 745 and 746 (provided that Entergy's Network service tariff and its Transmission service tariff, under which cajun receives service under subparagraph 2(b) above, make the continued ownership of the Transmission line or lines by cajun or by the transferee of its generating assets unnecessary for Cajun or its transferee's provision of current or future services by reason of the benefits provided under the new tariffs), as of the later of (i) twelve months from the date of the settlement or (ii) the date of the closing of the settlement.
Unless Transmission lines 745 and 745 are not transferrad to OsU as set forth herein, cajun will pay.RUS an. amount equal to the amount by which NRG Energy, Inc. and Zeigler coal Holding Company reduce the amount of their bid for the purchase of cajun's assets as a result of the transfer of Transmission CM the mall last I wwwu.m.
5
3, lines 745 and 746 pursuant to the settlement and RUS will release its liens on Transmission lines 745 and 746 upon such payment by Cajun.
3.
Settlement of all Claims and Disputes (a)
Any and all claims of any nature or kind, whether or not now pending in Court, whether known or unknown, whether founded in law, equity or otherwise, whether or not already asserted for any and all acts or omissions between Cajun and G80 or EnterTy, and between RUS and GSU or Entergy, will be dismissed with prrjudice and released and satisfied in full, including, but not limited to, all claims for the River Bend liaigation, the fraud and breach of contract case, the antitrust case, the nullity case and the service water litigation, and any claims of equitable subordination of Rus's rights, all pending cases before any regulatory agency or on appeal f rom any regulatory agency (such as the transmission cases before FERC, the merger appeals before FERC, the SEC and NRC and any and all other matters u nding before any regulatory agency) and any and all other claims or disputes between the parties of any nature whatsoever, whether or not in litigation.
(The foregoing does not include resolution of claims of RUS against Cajun.that are not specifically identified as resolved in this paragraph.)
Judgment will be rendered in favor of RUs in GSU's adversary proceeding asserting claims of equitable subordination of Rus's rights.
Any and all claine Cajun may have against RUS for equitable subordination, whether known or unknown, will be released.
Cajun will use its best efforts to obtain a waiver of all claims held by its members against GsU or Entergy under.the nullity case, and against RUs.
(b)
The preliminary injunction issued by the U.S. District Court in the service water litigation between GSU and Cajun shall continue in full force and effect until the closing of the settlement and upon such date, all funds paid and to be paid into the Registry of the Court pursuant to said injunction shall be paid over to OsU, together with all interest earned thereon.
4.
Approvals The Settlement is subject to the approval of (1) all regulatory agencias having jurisdiction over the subject matter; (2) the be huptcy courts (3) the Entergy soard of Directors; (4) the v '.ted states of. America on behalf of RUS.
The parties intend to give effect to and to close the settlement irrespective of the confirmation or lack of cu rma man run eva6m spp.
6
confirmation of a plan of reorganization of Cajun.
The parties will use their best efforts promptly to obtain all required approvals and to close the settlement.
The structure of the Settlement may be modified based u:pon tax or regulatory advice received by a party provided tae modification does not adversely affect another party.
The settlement shall close no later than June 1,
- 1997, unless the parties otherwise agree.
This settlement is dated as of May 1, 1995.
seen and Agreed this day of k o
, 1995 f
Y bWY s Cajun Efectric'Powe g ooperative, Inc.
through its Chapter 11 Trustee, Ralph R. Mabey Seen and Agreed this Als day of
, 1996 1
b Entergy Corporgelon and Gulf States Utilities by Michael G. thompson Senior Vice President & General Counsel Recommended for Adoption by Rural Utilities Service this 2.LA day of
, 1996.
)
i n
Larry M. Belluz(dJ Program Advisor 1
4 9
CM isedll WIDI le 84.8 GWDM6ILJ9pe 7
EXHIBIT No.1 i
F RIVER BEND !OPOA - AMENDMENT CONSIDERATIONS New own.r(s) of River Bend may wish to amend the JOPOA as follows:
a.
Seedon 1.6 Adminlitrative General Charves Section should be revised to specifically spell out definidon and method of calculating OSU's A&G
- add ons."
b.
Section 4.2 OSU Aerents Annointment of Aeent Needs a mutual agreeable definidon of 'Oood Utility Praesice.'
c.
Seedon 6.5 *.D.amane or Destruction' Needs better definition as to a minority owner's right not to take part in any major capital addition whether it is part of a replacement of damaged equipment or expansion of capacity.
d.
Section 8.5.1 Method of Billine and Payment The current section has been modified by mutual agreement as'follows:
1.
The right to include a condngency amount to the estimated bill has boca dropped.
2.
Tbe current estimated monthly blil with a two month true up. Both sides have agreed to use prime rate for interest either charged or credited. These changes abound be carried to a new owner.
c.
Aniele 10 Default: Defaulting Party should have input in advance as to where the power is being sold and the price for power being sold. Also the power should be able to be sold for a 6 to 9 month perind.
Current sale period is 90 days which can limh value rtccived.
A non defaulting pany which pays a defauldng party's costs abould have addidonal protection.
f.
Budret Review and Inout The Cunent JOPOA Does not contain any language on budget formulation or forecasts. We suggest a new secdon calling for the owners to jointly review the budget formadon process and forecast process.
This would prevent mimadstanding over the plant's needs.
Provide minority owner with adequate and reasonable safeguards against excessive capital expenditures.
Parties should have access to additional information on fuel and transportation costs.
4 y
-D
i i
EXHIBIT NO. A-2
i i
No Significant Hazards Consideration Evaluation Pursuant to 10 C.F.R.
S 50.92 A.
Proposed Change:
The proposed amendment to the Operating License would revise the Operating License to reflect the transfer of Cajun's ownership interest in River Bend to EGSI.
The amendment does not change the operation of River Bend.
B.
No Significant Hazards Consideration Analysis:
Applying the three standards set forth in 10 C.F.R.
S 50.92, the proposed change to the Operating License involves no significant hazards consideration:
1.
The proposed change will not involve an increase in the probability or consequences of any accident previously evaluated.
As a result of the proposed license amendment, there will be no physical change to the River Bend facility, and all Limiting Conditions for Operation, Limiting Safety System settings and Safety Limits specified in the Technical Specifications will remain unchanged.
Also, the River Bend Quality Assurance Program, Emergency Plan, Security Plan, and Operator Training and Requalification Program will be unaffected.
The employees of EOI presently engaged in operation of River Bend and organization structure of EOI and EGSI will be unaffected by the proposed amendment.
Therefore, personnel qualifications will remain unchanged.
2.
The proposed amendment will not create the possibility of a new or different kind of accident from any accident previously evaluated.
The proposed amendment will have no effect on the physical configuration of River Bend or the manner in which it will operate.
The plant design and design basis will remain the same.
The current plant safety analyses will therefore remain a
complete and accurate in addressing the design basis events and in analyzing plant response and consequences.
1
-)
6 i
The Limiting conditions for Operations, Limiting Safety System Settings and Safety Limits specified in the Technical Specifications for River Bend are not affected by the proposed license amendment.
As such, the plant conditions for which the design basis accident analyses have been performed will remain valid.
Therefore, the proposed license amendment cannot create the possibility of a new or different kind of accident from any accident previously evaluated.
3.
The proposed amendment will not involve a significant reduction in a margin of safety.
Plant safety margins are established through Limiting conditions for Operation, Limiting Safety System Settings and Safety Limits specified in the Technical Specifications.
Since there will be no change to the physical design or operation of the plant, there will be no change to any of these margins.
Thus, the proposed license amendment will not involve a significant reduction in any margin of safety, c.
==
Conclusion:==
Based upon the analyses and description of the transaction provided herein, the proposed license amendment only reflects a transfer of ownership to an existing owner and licensee, and will not involve a significant increase in the probability or consequences of any accident previously evaluated, create the possibility of a new or different kind of accident from any accident previously evaluated, or involve a reduction in a margin of safety.
As a result, the proposed change meets the requirements of 10 C.F.R.
S
- 50. 92 (c) and does not involve a significant hazards consideration.
1 2
EXHIBIT NO. A-3
IN THE UNITED STATES BANKRUPTCY COURT FCR THE MIDDLE DISTRICT OF LOUISIANA
)
la re:
)
CIVIL ACTION
)
NO. 94 2763 B2 CAJUN ELECTRIC POWER
)
COOPERATIVE, INC.,
)
BANKRUPTCY CASE
)
NO. 94-11474 Debtor.
)
)
Chapter 11 Federal. Tax Id. No 72-0655799
)
\\
MOTION OF RALPH R. MABEY. CHAPTER 11 TRUSTEE.
TO SELL RIVER BEND INTEREST FRFF AND CLEAR AND TO ASSUhE AND ASSIGN EXECUTORY CONTRACTS Ralph R. Mabey, Chapter 11 Tmstee (the " Trustee") for Cajun Electric Power Cooperative, Inc. (" Cajun"), by and through undersigned counsel, in exercising the authority provided to him by the Order and Judgment Approving Settlement By and Among Cajun Electric Power Cooperative, Inc., Entergy Gulf States, Inc., Entergy Corporation, and the Rural Utilities Service of the Department of Agriculture entered by the United States District Court for the Middle District of Louisiana on August 26,1996 (the " River Bend Order"),' hereby moves for an Order confirming that the following actions comply with the terms of the River Bend Order:
(1) the Trustee's sale, pursuant to section 363, of Cajun's 30% interest in the River Bend nuclear generating facility and related assets (the
- Cajun River Bend Interest") free and clear of
-liens and encumbrances pursuant to agreement between Rural Utilities Service of the United States Department of Agriculture ("RUS") and PECO Energy Company ("PECO"), and (2) the Trustee's assumption of the Jobt Ownership Participation and Operating Agreement, River Bend
' The River Bend Order has been appealed but no stay has been issued.
Unit 1 Nuclear Plant, as amended (the " River Bend JOPOA"), and his assignment thereof. A i
proposed form of order approving the Motion is attached, in support of this Motion, the Tnistee states as follows:
1.
The Trustee on behalf of Cajun, RUS, and Entergy Gulf States Inc., formerly known as Gulf States Utilities (which, together with its parent, Entergy Corporation, will be refetted to as "GSU"), compromised and settled certain controversies r.nong them by signing a Settlement Term Sheet dated May 2,1996 (the " River Bend Settlement").
2.
After notice and a hearing, the River Bend Settlement was approved by the River Bend Order.
3.
Paragraph 16 of the River Bend Order authorizes RUS to seek a purchaser for the Cajun River Bend Interest prior to consummation of the River Bend Settlement. RUS has sought offers for the purchase of the Cajun River Bend Interest and has received an offer which is acceptable to RUS.
4.
Notwithstanding he authority provided to the Trustee by paragraph 16 of the River Bend Order to sell the Cajun River Bend Interest prior to consummation of the River Bend Settlement, the Trustee elects to request current approval for a sale of the Cajun River Bend Interest (and the assumption and assignment of the River Bend JOPOA) to be closed concurrently with consummadon of the River Bend Settlement. The Trustee does not believe that completion of actions required by the River Bend Settlement will delay closing of an approved sale of the Cajun River Bend Interest.
5.
Further, notwithstanding paragraph 8 of the River Bend Order, which authorizes the Trustee:
2
l i without the necessity of any funhet order or approval of this Coun, to transfer l
all assets as provided in the Settlement, including but not limited to the Cajun River Bend Interest, Cajun's interest in River Bend fuel and spare pans (under the option provided for in the Term Sheet,... free and clear of any lien or other interest assened by any pany(,)
and paragraph 10 of the River Bend Order, which authorizes and directs the Trustee:
without the necessity of any further order of approval of this Coun, to take any and all actions necessary or appropriate to implement, effectuate, and consummate the Settlement and any transactions contemplated 'hereby or by this Order [,]
the Trustee believes it is appropriate to notify parties in interest of his intent to sell the Cajun River Bend Interest and to assume and assign the River Bend JOPOA as set fonh herein and to obtain an Order thereon confirming that the actions are in compliance with the River Bcnd Order and including provisions that confirm that the sale is free and clear of liens and other interests and that PECO is entitled to the knetits and protections of 11 U.S.C. 5 363(m).
6.
RUS has notified the Trustee that it has cercised its sole discretion and elected to transfer the Cajun River Bend Interest pursuant to Option 1 under the River Bend Settlement.
'Ihe River Bend Settlement provides as follows:
In the sole discretion of RUS, the Cajun River Bend Interest will be transferred under one of the two options or subptragraph (f) set forth below.
... RUS shall have substantial flexibility in exercising its discretion to arrange for the transfer of the Cajun River Bend Interest. In funherance of that end, RUS's flexibility shall include, but shall not be limited to, negotiating with and selecting a prospective purchaser, being permitted to establish a reserve price which must be met before consummating a sale at auction, not being required to accept the highest bid received at an auction and taking title to the River Bend Interest itself for subsequent reconveyance.
Option 1 The Cajun River Bend Interest and Cajun's interest in River Bend fuel and spare parts will be sold, with net proceeds remitted to RUS. The purchaser will become obligated to fully comply with the Cajun NRC license requirements, all 3
k other applicable laws and regulations and the provisions of the River Bend JOPOA, as amended in the respects described in Exhibit No.1, commencing with the date of the transfer of the Cajun River Bend Interest....
7.
The Cajun River Bend Interest is to be sold pursuant to the tenns of the Agreement between RUS and PECO Energy Company dated as of February 11,1997 (the "PECO Term Sheet"). Pursuant to the PECO Term Sheet, the purchaser is to be PECO or its designated assignee, unless RUS accepts an offer from another pany. Any pany making a competing offer shall submit the offer to RUS, Attn: 1.any A. Belluzzo,14th and independence SW, Room 4031-S, Washington, D.C. 20250 within the time period set fonh below.- The Term Sheet is attached as Exhibit A to this Motion. It sets forth the operative terms of the propaed sale, except that the purchase price has been redacted.
8.
The purchase price has not yet been disclosed to the Trustee. For bidding purposes, RUS desires other interested purchasers to contact RUS directly and make any proposal without knowledge of PECO's proposed purchase price. If requested, RUS will disclose the purchase price to the Court in camera, in any event, the purchase price will be disclosed in accordance with the provisions of paragraph 10 below..
9.
The Trustee would prefer that RUS disclose now the proposed purchase price, but believes that the disposition of the Cajun River Bend Interest is sufficiently important that he needs to proceed to request approval for the actions contemplated by this Motion prior to disclosure of the purchase price. Each of the three proposed plans of reorganization before the Court is contingent upon consummation of the River Bend Settlement. Consummation of the River Bend Settlement requires, in turn, final disposition of the Cajun River Bend Interest.
4
10.
The Term Sheet provides the opponunity for third panies to submit a bid for the Cajun River Bend Interest to RUS. Because RUS has exercised Option 1 under the terms of the River Bend Settlement, RUS is the pany to receive and determine the acceptability of such third party offers. Acceptance of a third party offer is exclusively within the discretion of RUS. In order to be valid, any such third-party offer must be received by RUS no later than five days prior to the dat; on which the Court schedules a hearing on this Motion. Any bid submitted after such date shall not be considered by RUS. In the event that RUS has received a timely offer but has not yet determined to accept such offer, the time for disclosure of the proposed purchase price to PECO will be extended until such time as RUS makes a determination to accept or reject such offer, which determination shall be made no later than the date and time of the hearing set on this Motion. The Tmstae will request the earliest hearing date available for the Motion which is at least thirty days after the filing of this Motion.
11.
Objections to the Motion should be filed with the Court and served on appropriate parties at least five days prior to the hearing on the Motion.
12.
If RUS, in its sole discretion, accepts another offer and PECO does not submit a higher offer, RUS has agreed that PECO should be paid a topping fee. If the purchase price to be paid by PECO is disclosed by RUS, the Trustee, or the Court before a higher competing bid is submitted to RUS or the Coun, such bid is accepted by RUS, and PECO does not submit a higher offer, the topping fee will be the greater of FECO's documented out-of pocket expenses up to $1 million that it paid in pursuing purchase of the Cajun River Bend Interest or 3 % of the difference between PECO's original proposed purchase price and the fmal purchase price accepted by RUS and approved by the Court. If the purchase price is not disclosed by RUS, 5
the Tmstee, or the Court before competing offers are due as set fonh below and the Court does not consider and approve an offer first presented after such due date, or is disclosed by such party concurrently with or after a higher competing bid is presented, the topping fee will be PECO's documented out-of pocket expenses up to $1 million. In either case, RUS has agrec '
that payment of this topping fee shall be from proceeds of the Cajun River Bend Interest which othenvise would go to RUS.
13.
Because the topping fee, if any, paid to PECO will be deducted from the net sale proceeds which are paid, pursuant to the River Bend Settlement, to RUS, the topping fee has no effect on the estate. RUS's claim against Cajun will be reduced to the full extent of the net sale proceeds from the Cajun River Bend Interest which include any topping fee or PECO expenses paid.
14.
The PECO Term Sheet contemplates the assumption by the Trustee, acting on behalf of Cajun, of the River Bend JOPOA (with amendments thereto as set forth in the River Bend Settlement) and the assignment of the River Bend JOPOA to PECO.
15.
The River Bend Settlement as approved by the River Bend Order resolves outstanding disputes relating to the Cajun River Bend Interest and the River Bend JOPOA The River Bend Settlement's resolution of disputes does not take full effect, however, until s
consummation thereof. Because of this, the Trustee has determined that the sale of the Cajun River Bend Interest will not close prior to the closing of the River Bend Settlement, although he expects that the two closings will occur concurrently.
16.
The PECO Term Sheet satisfies the conditions of Optbn 1 for disposition of the Cajun River Bend Interest set forth in the River Bend Settlement. Nothing in the PECO Term 6
a a
Sheet shall modify the River Bend Settlement and any of its terms which conflict with or are not included in the River Bend Settlement are effective only between RUS and PECO except the date by which the River Bend Settlement must be consummated. By its terms, the River Bend Settlement must close no later than June 1,1907 "unless the parties otherwise agree." Paragraph 14 of the River Bend Order authorizes any of the panies to move the Court for an extension of the date for the River Bend Settlement to close.
17.
The PECO Term Sheet provides that either RUS or PECO may terminate the PECO Term Sheet if by September 30,1997, among other matters, the Court has not approved the sale to PECO on the terms and condition set forth in the PECO Term Sheet and this Motion or if by December 31,1997, the sale contemplated by the PECO Term Sheet has not closed.
The parties intend to attempt to complete the sale contemplated by the PECO Term Sheet prior to June 1,1997. If that does not occur, however, the Trustee, with the consent of RUS and GSU, moves for approval of an extension of time for the consummation of the River Bend Settlement as necessary to comply with the PECO Term Sheet or December 31,1997, whichever first occurs. GSU has agreed reasonably to cooperate in facilitating the sale of the Cajun River Bend Interest. GSU's submission of an offer will not be construed as a failure to cooperate.
GSU's obligation to cooperate in facilitating the sale of the Cajun River Bend Interest is a continuing obligation and failure to so cooperate shall form the basis for a motion to extend any deadline set forth herein.
18.
In the event that the sale to PECO contemplated by this Motion is not approved or if PECO terminates or withdraws its offer to purchase the Cajun River Bend Interest on the terms set forth in the purchase and sale agreement, RUS shall retain the right to exercise its 7
options set forth in the River Bcnd Settlement, including the sale of the Cajun River Bend Interest to a third party, accepting transfer of the Cajun River Bend Interest to itself, or transferring the Cajun River Bend Inter:st to GSU. In the event that GSU reasonably cooperates in facilitating a transfer under the options set forth in the River Bend Settlement, RUS shall exercise such options within ninety days of such failure of approval or the determination by RUS that the sale to PECO will not be consummated. In the event that RUS does not exercise such an option during this period, it will be deemed to have exercised Option 2, which provides for RUS tak'ing title to the Cajun R'ver Bend Interest. In the event that this paragraph becomes operative, the parties will proceed expedit.ously to consummate the River Bend Settlement, provided, the final disposition of the Cajun River Bend Interest shall not be delayed beyond December 31,1997, and by that date, Cajun shall retain no interest in the Cajun River Bend Interest, title to which it shall have transferred to RUS or others as provided herein, and the River Bend Settlement shall have been consummated under its approved tertns, except that, if RUS has exercised an option under the River Bend Settlement and the only remaining condition to transfer pursuant to such option is final regulatory approval for such transfer or the actual, mechanical transfer of title, the panies may agree to a further extension within which to close the transfer.
19.
The Trustee requests that the Court find that the sale as set forth in this Motion in furtherance of tne River Bend Settlement is commercially reasonable and that PECO is purchasing the Cajun River Bend Interest in good faith and thas is entitled to the benefit of 11 U.S.C. 9 363(m). The Trustee avers that PECO has entered into the PECO Term Sheet in good 8
faith and that the process under which PECO has had the opportunity to purchase the Cajun River Bend Interest establishes the commercial reasonableness of the proposed transaction.
20.
The PECO Term Sheet contemplates that PECO and the Trustee will execute a formal purchase and sale agreement which will be submined to the Court at least five days prior to the date of the hearing on this Motion. The purchase and sale agreement will include the purchase price, 21.
The PECO Term Sheet conditions the finality of the sale of the Cajun River Bend Interes: and the assumption and assignment of :he River Bend JOPOA on the existence of no material adverse change, and satisfactory approval of the sale and PECO as purchaser and as party to the River Bend JOPOA by applicable regulatory agencies, and the completion of due diligence. PECO has agreed, however, that it wil' complete its due diligence by the earlier of sixty days from the date this Motion is filed and served or forty-five days after the Court approves this Motion. The Trustee has agreed to request an early hearing date on the Motion.
In the event that PECO does not receive the satisfactory cooperation of all parties needed to complete its due diligence, the Trustee, PECO, or RUS may request that the Court authorize an extension of the time for PECO to complete due diligence.
22.
The Trustee's approved agreement with Wasserstein, Perella & Co., Inc.
("Wasserstein") arguably allows payment of a commission to Wasserstein on account of a sale
)
of the Cajun River Bend Interest. Wasserstein has waived its right to a commission related to the sale of the Cajun River Bend Interest pursuant to this Motion.
9
WHEREFORE, the Trustee prcys that after appropriate notice and hearing, the Court
}-
approve for consummation on the closing date of the River Bend Settlement, (a) the sale of the Cajun River Bend Interest free and clear of liens and encumbrances to PECO or to such other party whose offer is accepted by RUS pursuant to the PECO Term Sheet, and (b) approve the assumption and assignment of tW River Bend JOPOA, all as set forth above.
KANTROW, SPAHT, WEAVER, and BLITZER A Professional Law Corporation u
David S. Rubin (Louisiana $af #11525)
Connell L. Archey (Louisitnd Bar #20086)
Suite 300, City Plaza 445 North Boulevard P.O. Box 2997 Baton Rouge, Louisiana 70821-2997 Telephone No.: (504) 383-4703 Kenneth L. Cannon II (Utah Bar No.3705)
Lon A. Jenkins (Utah Bar No. 4060)
LeBOEUF, LAME, GREENE & MacRAE, L.L.P.
1000 Kearns Building 136 South Main Street Salt Lake City, Utah 84101 Telephone No.: (801) 320-6700 4
Counsel for Ralph R. Mabey, Chapter 11 Tnstee for Cajun Electric Power Cooperative, Inc.
H.\\D AMD\\WP\\26604\\ PLEADS 7PMV3END. MOT 10 l
et 4
EXHIBIT A
\\
AOREEMENT BETWEENTHE RURAL UTILITIES 5EKVICE 1
AND PECO ENERGY COMPANY Tids Agreement, deed as of Fehnery 11.1997. Is esecued by ami barween PECO Escrgy Company CPECO*) and du Uniisd Semes of America, acting through the Adadaiserstor of the RuralUtilldes Service (*RUS*).
WHEREAS, RUS is authorized to seek a pushaser for tbs Caja River Bend laterest (" Cajun River Dead Imsrese) as that taan is d=6aed in the Senicannr Tem neet ("rerm Sheet") dated as of May 1,19%, by and among Cahm Electric Power Cooperative, Inc. ("C4un") operadna through im Chapear 11 Trustee, Ralph R. Matsy (* Trusses"). Gulf Stassa Utilitics (*05U*), and RUS, pursuant to the Term Sheet ad as order Corder") daad August 25.1996, of the Unied States Dismet Court for the Middle District of Louisiana, approving the Term Shect; WHEREA3, P===a' to the Term Sheet RUS may havs ibe Caja banimgrery easie sell the Cajun River Band Issarest and Cajun's insurent in luver Band fuel and spare parts and other rights under tbs Joim Owocmhip PartP-Agreement ("JOPOA") and ibs Term Sheet, (the Cajun River Bad Imamest and cejun's inamust 'm River Band feel and apare parts. electrical output and other richas under the JCPOA and the Tenn Sheet collectively hermanfter called the " River Bcad
. latomst'), with the not c ie fmm such ale remitted to RUS pursums to the Term Sheet and a
Order; -
WHEREAS, RUS desires to have ths River Band Insertst transformd and sold to PECO or one of its.m-
. and PECO desans e parchans the same in la own aans or that of an afElism; and WHEREAS, the sale of the River Bend iaterest to PECO is in be made pursuant to Optien 1 of the Term Shest, and thin Agmement shall provide tbs isras wherstry such option shall be impih bytheTrusus; NOW T1!EREFORE, foc and in Naa of tbs y,h and tbs meal covenanas hamnatur sousmined, tbr panns bases agree as ibliows:
SECIlON 1. RUS and PECO shall provide a copy of this Agruemer,Im the Trusist in ordst to notify him of me tamts under which RU3 is willing m azatis Option 1 of tbs Term Shoct.
PECO shall proceed to negonus with Trustes ths asssusry pushees and an1* a6 vemsat (the
'Purubess and Sale Asmament") and sush other documsnession as is tupand is -a-'-
the sale to PECO oa tmans esseptable to RUS upon issuansa of an enisc by the Cajun bankruptcy eeurt osasisemat with the tsans of this A..
_ _ _ -* RUS and PECO shall aquest that the Trtntee submit a modos and psoposed order
-M-"
=i to Trustse, RUS and PECO to the CWun bankmpsey court to ohema approval of this Agreamsm and of a sie pursuant hanno. Such d
httbass and Sals Agreemem shall consin rupresenations and warrannes, covunants, and v
condhions so closing ='W'a y to PECO,.RUS andTruses.
p 1
c'
SCCTION 2. Le following eenditions precedesa shan Imve been saasned prior to de trartsfer of tW. ef the Riwr send 1sterve frova cajan to PEco, psymmu of the purchase prica, and rutcase ofliens as herinahr provided (the *Closmg*):
(a) An order shah have been etend by the Cajun lankruptcy court to tbs sffsct thac
- 0) tbs mic tu PECO vr oas ofia AfEhnass puvunat to dw tenna of the Pwchaos and Sale Agrasmans shan haw hasa approved, Gi) tbs amount ofRU5's claims against Cajun shall be reduced only to the extent
, of RUS's receipt of pM from the sale:
Gil) the rt! cases by RUS ofirs liens and ensumbrances aru not a waiver or release of the pardon of RUS's claims asamst Cajist that suman unssusfied; Ov) the sais has been conduced in a coannarsially tussonable manner for a scannerciaDy rianonable pries; (v) PECO is a good falds yh as that arm is used m Section 363(m) of the Bankuptcy cadr, (vi) the assumptien by the Trumme and tbs aansarnant e PECO of River Bend-rslaned sacutory consens designmsd by PSCO is appeeved; and (vii)ilm Rivue Bend Interestis coswyed teen Cajun to PECO f =s and clear of all liens and encumbrance of third pernas, except those agreed to by PECO:
(b) PECO shall have completed its duc dilisence tuview with respect to ths Rivur Band Intstust ami the Joint Faci!1 ties (as defined in tbs JCPOA), inchuhng iq i ; y staans and5m"~e, the adsicase of third party slaims, ed the opseudos and
==aw of the Joint Fasihaies.
(c) The JOPOA shab have been amended in the respects described in Exhibit No I to the Term Sheer, and as mariiht the JOPOA shad have been assumed by the Trustne and the Trussit shall asagn the amended JOPOA to PECO at Closing; (d) All applicable waiting periods unlee 1bs Hars.Seou-Radino Ast shall have expired or been = w and the - er approval reedred of du r su== of Justice med the Fednes1 Tride commission,if any, sinD have been eW (e) Bw Trusine shall have deposted in escrow the sum provided Mr in tbc Terrn Shset as a decommierlanir'r trust had (the "ha==inir=ing Fund") to be used for the prudent sapsoditurn of desammissioning costs as deined in tbs Term Shost and subject to sacrow '. -
sadsfacaory to PECO, RUS and Truster, 2
(f) Trusum and PECO shall have sssemed a PC and sais Agrusmsnt acceptable to RUS ewng W, warande, covenants, and cleans condidens
=M---
, to PECO. RUS and the Trumer.
(g) Unicas.04 waived by PSCO, there sha!! have ocessmd no mesmal adveme shange in the Joint Fasilaies from their condition as of the due af exscanon of this Ag,wsinant until Cloems, including but not limitad to: an angoms escheduled outage; the pendency of a material violarioet of the River Bend ey...dag license er any other Nineleer Reguiaspry CatBirussist ("NRC7 rettuittment tbs unfavurabic
. tertninance of casang fuel supply or snrictsnest conuasts; tbs occwance of a material or equipment thihtre wtucit resluires expsoditwo by PECO in smoess of 31 tinllion widun uns year of Closing; a change in plaat anguipeneau or plant go.a which dwing dalgence increases gM operating costs dunng any ai.8, y.m,1p97 ihm h 2 cot, by sw., mm. above.,. mains a.d/or e.,iini cxpendnurt levels projesand by GSU in h==== provided to PECO on Augu.: 6 1996 by the U.S. C, -- _- _
of Janice, esclusive ofincreased expandimres fer a power upree and Mal high pressure sans turbans rotar rapine===n (h) All ascessryjudicial and reguisery gprovals shall have been WM (i) All asmsmans with osu/Easersy, es es=d a by osu underib T== sh t insloding agnainset ever GSU/Estarty's provision ofWA surdce for empenity and emergy assoassed wink Capa's River Bend Innerest, shall have been esseleesd; and CD The fann of au h-a be delivered in -
1 with closing and the transfer of tide m PECO or one of ta AfE11assa shall have been agreed upon by Trusenc,lt.US and PECO. Sah Waa shallincludr.
(i) A selease oflisa eascused by RUS miensing all afins liens and encumbrances as the River Band Insurest at the tirne of the transter of tide.
(10 salew-in proper legal lbum adurusely describing 1be River Bend lassnet and h =' =4 good and markstable title ofibs River Bend Interest noPECO.
(iii) Evidness thattbs Trusase sbau have establisind du D= - = Ming Find.
(iv) Evulsans that PECO shall have estabilshed the Lener of Credi y.. M for in seenan 5 berum.
(v) Evidsm that ths Truseus has given ^~y noties to a!I appropriate third parties = essmry da River Bend Innwest free and slaar of au liens and 3
SECTION 3. Tids e the River Bend Interes and - =>-I ow- ; '9 risks shall net pass to ff,CO until Closias.
SECHON 4. At Closin6, the inuowing shall occur:
(a) RUS shad nessw fmm PECO the Purthase Prics, by drawing under the Lener of' Credit. and the Accrued Interest Paymem (as provkind in Section 5 hema).
(b) Pwnamn to the onist described in Section 2(a) above, PECO ahan assume all of Cahun's 'anarest and obugssions toen the des of Closing under the JOPOA, the NRC liesmas and any resoniad doewnents of transfer het=uen Caiun and OSU ri!a:ing to
- River Bend, and all such interest and obliganen shan be canceled and te:mir.ated as to Cahm 6am the due of Closmg. PECO shnu become ottlismed to $dly comply with the Cejun NRC liennas reparansats, an other applicable laws and regdations, and the provisions of the JOPOA, as amended in the respects h%d in Ezhibit No, I to ths Tenn 5 hest. tom and after the dam cf Closing.
(c) RUS shnu cassues and dehver to PECO, with a copy to the Trusine, a telease of all its liens and 2- ='- ; :la recordable form on the Cajun Riwr Bend laterest. Such reisens abau be delivered and asespied wnhout covenat or warrsary. czpress or itnpiiad, at law or in aqmty, and withom recourse m RUS in my svent or in any connnemey, (d) Tnmisc shnu sassar and deliver to PECO or at PECO's option, is designaud A!5Haas, transfer doesnsam ='#inw to convey tide See and clear ofliens and ensumbsensa yesment to a no-wearnary dead in the River Band Interest, and sneta==r to emewy to PECO an rfghts to the Deconnusmaams Fund to be used as pecmded for eder NRC approvals or requiremems in offust htsu time to tims, as won a Air N==='ahg a dsGaud in ths Teun Shese,with eascas proceeds in
' p'== 1 o the tbs Nv====t==iaalag Fund aAsr completion of C -
t
=
RUS, passantto tbsTerm sbest.
SECHON 5, (a)The pria to ph the River Bad Interest shall be 3 h04, CPurchase Pric="). PECO shan furmsk to RUS a tener of credit fbr the Purchass Prics reming RUS a bensaciary ad issued by a $sderally insured beak approved by RUS and,
havns smadidons to drawing satisfactory e PECO, RUS and Trusses (the "Lenar of Credat). Bush Lanar of Credit aban be provided as or before the dame that the Trusine files a motion with t'ne Cahm bankruptcy coat to approw tne sale to PECO.
(b) PECO shall make a payment to RUS at closing represuming intsrat on ths Purchass Prica that would have accrued tom the dam that ths Trusase Gus a motion with tbs Cajun Bakrupey court no approve the sale in PECO unti1 Closing (tim "Asurued Innerem Payaser). The tem ofinneruse used to entenlase the Acerned Interest 4
e' s
Payment shall be five permet (5%) per anman comp w annually on the anniversary dass of the filing by the Trustee of the motion tofurred to in Section 1.
(c) RUS will mW to Ttustes that PECO becerne the markeer of River Bend act electrical output on behalf of the Cajun Estsee (" River Bend Marketer") as soon as practicable mRet the date that the Trustse files a motion to approve the sale until the earlier of(I) Closing or (ii) termination of the Purchase and Sale A,st.
a SECTION 6. (a) This A,
= may be terumsied at the election of either party (if so terminsied ths Lease of Credit sha!! czpire or be canceled) if either:
(i) on Wh-30,1997 PECO is not the River Bend Marketer and tbs Cajun Mpy court has not approved this Agreemsat er, (ii) by D
=M 31,1997, Closing has not- :.
(b) If the Purchase and Sale Agreement is rejected by the Cajun uuptcy court, this Agreement may be tamW at the elecdon of eitbar party and, if so temia=*-i the Lanar of Credit shall expire or be canceled.
(c) This A,
- may be imminated by PECO if(i) the due,imy reviewicterred to in Section 2(b) reveals a situation, unknown by PECO when it exacised this A,4 which PECO My believes in be a maandaDy adverns condition or (ii) there occurs a material adverse change which is not waived by PECO pursamt to Section 2(g). In such event, the Letter of C.tedit shall expire or he enne=W (d) PECO sha!! not tensive the payments provided fbe in Seenons 9(b) or 9(c) if eisker
(i) PECO meninams this A,
= pursuant to Secrions 6(a),6(b), or 6(c); or (ii) RUS tunnismes this Agreement pursuant to Sections 6(a) or 6(b) before the CajunMwy coort13,.
4wisha higher comparingbid.
SECTION 7. PECO may desigaste ces ofits AfElisses to be the transfesse of the River Bend Interest and may asign its risins and obligations hereunder e such ate 11ase,if such Afmiate
,/2--a' NRC requirunents, wnhout fhrther consent by RUS or Trustee.
meetse SECTION 8. Except as provided in Section 9 of this A,==-m RUS and PECO shall cach bear its own expenses in negotiating this Agreement and hng the sale, including, but not limitad io, tbs fines and sapenses ofits assomsys, eh. and she.
F
.g SECTION 9.
(a) RUS repressens to PECO that it has not enimd into or execuand any mstrument with any other party that would conenar a currtsdy binding purchase and sale agreement or nght to match relatmg to the sale of the River Bcad Interest.
Alls agrams that it will nether instmne initial contacts for the purpose of soliciting c5srs for the River Bend Intersst tbtlowtag sascuthm of & Aspa.: not seek inumal approval form-! oNcca for the River Dead Interest other than these presented to the Cajun bankruptcy cows aAer the Trustee files a motion to approve
& Agreement. This is not inicoded to prevent RUS from responding e any party who coansa RUS emarning the River Bad Inamst er frora discurring such party's proposal se pwthans ibe Itiver Band laserest. MIS may, in its sole disemon, accept seek a sempedag ofer prior to tha dew on which tw Ca;un bankruptcy court cr.tcrs an order approviet the sale to PECO.
(b) PECO believes thattbs Purchase Prism is business sensinvs informasion. PECO thurufbre will iuquest ths Trusass to redset the Pashase Piise from public Slings until tbs angry of the ordsr apprimas tbs asic. The RUS wi11 support this request. If(i)
PECO's purshans prism is MM by RUS, the Trusess, or the Cajun S#y court, befort a higher competing bid is presented to the Capst bankruptcy court (11) a compeans bid is pressened w the Ceim bankrupery sourt and accarmd by RUS, and (iii) PECO does not sabout a higher offer, the Ienar of C:sdtt strl! be returned undrawn to PECO, and PECO sha!! be paid a topping *r Es topping for shall equal tbs gramer of(a) PECO's dosaansused oursf-pod expenses therit paid in
.N-pasuing the pusbass of the River Band Inasresa e to f'. mi!Iion. or (b) 3% of b dif5=enos betwesa PECO's edginal proposed puebnes prise sad the Anal purchase pries asespeed by RUS and approud by the Caim Spy comt, wie suh payment e PECO to be deducted by the Trustee from the net we remitted to RUS. Payment to PECO shall occur samhansons with payment to RU3 of pow.4.
fhna the sucesssftd bidder.
I (s) If(i) PECO's purubase pries is not dissloend by RUS, me Trussee, or the Cajun bankrigesy sont befuse a bigber competing bid is presensed so the Caj a henkruptcy emet, or is disclosed simirhnnenun with or aAur a haghar compeans bid is prtsemmi to tem Opun henkruptcy court. (10 a compsans bid is tossived by the Caim bankrupecy court and accuped by KUS. and (IID PECO does not subaut a highsr offor, the Least of Credh shallbe retwand to PECO undrawn, and PECO shall be.sa 4 for h-in-1 out ofpskst expenses that it paid in pursuing the purchase of the River Band Innerust, up to $1 million, wish such payment to PECO to be deduewd by the Tammes item tbs est poseeds temined in the RUS.
.h (d) PECO agreur so inaks available to RUS on request all records documenting PECO's out of-pocket azpenses paid la pursuing the purchase of the River Bend Interest.
i SECTION 10. Nothing in & Agreamsat, siebsr express or implied, is ic=ul-t to confer any
.8 risins'er namedies under or by reason of & Agreement on any party onber than PECO and RUS I.TJ and their.wh p==4 successors and assigns.
"O
l
... s-i SECTioN 11. This Agreernent se.s forth the entire Agroanent of the parties with respect to the transaction contemplated hereby and w4s all prior apwts and undeerdia-* with aspect to the subject maner hereal SECTION 12. This ApM sha!.1 runain in effect until Closing or termination as provided in Seedon 6 hereof.
~'
SECHON 13. PECO hereby agrees that nothing la the Tenn Sheet or this Agreement shall give rise to any obligation or liability on the part of RUS to PECO with respect to the pun:hase,
-w ownership or operation (including Nern-inioning or Decommissioning Costs, as defined in the Term Sheet) by PECO of the River Band nuclear power plant or the Rrver Bend Interest.
TN WITNESS WHEREOF, the partiss hereto have caused this A,w to be duly executed as of the date and year first above written.
UN1'ED STATES OF AMERICA I3kh 3_ M Y-Wally B. Beyer
\\'
L K
p ; i ator T
RwalUtilities Service PECO ENEROY COMPANY h.-
"dd W.
weae.
7
IN THE UNITED STATES BANKRUPTCY COURT FOR THE MIDDLE DISTRICT OF LOUISIANA
)
Inre:
)
CIVIL ACTION
)
NO. 94-2763-B2 CAJUN ELECTRIC POWER
)
COOPERATIVE, INC.,
)
BANKRUPTCY CASE
)
NO. 94-11474 Debtor.
)
)
Chapter 11 Federal. Tax Id. No.: 72-0655799
)
)
NEMORANDUM IN SUPPORT OF MOTION OF RALPH R. MABEY. CHAPTER 11 TRUSTEE. TO SFIL RIVER BEND INTEREST FDFF AND CLEAR AND TO ASSUME AND ASSIGN EXECUTORY CONTRACTS Ralph R. Mabey, Chapter 11 Trustee (the " Trustee") for Cajun Electric Power Cooperative, Inc. (" Cajun"), by and through undetsigned counsel, in exercising the authority provided to him by the Order and Judgment Approviag Settlement By and Among Cajun Electric Power Cooperative, Inc., Entergy Gulf States, Inc., Entergy Corporation, and the Rural Utilities Service of the Department of Agriculture entered by the United States District Court for the Middle District of Louisiana on August 26,1996 (the " River Bend Order"), submits this memorandum of law in support of his motion (the " Motion") for an Order confirming that the following actions comply with the terms of the River Bend Order: (1) the Trustee's sale, pursuant to section 363, of Cajun's 30% interest in the River Bend nuclear generating facility and related assets (the " Cajun River Bend Interest") free and clear of liens and encumbrances pursuant to agreement between Rural Utilities Service of the United States Department of Agriculture ("RUS") and PECO Energy Company ("PECO"), and (2) the Tmstee's assumption l
of the Joint Ownership Panicipation and Operating Agreement, River Bend Unit 1 Nuclear-Plant, as amended (the " River Bend JOPOA"), and his assignment thereof.
FACTS The Trustee adopts the facts set forth in the Motion.
LEGAL DISCUSSION 1.
The Procedure Followed by the Trustee in the Sale of The Caiun River Bend Interest Is Anoroeriate.
The procedure followed by the Trustee with respect to the sale of the Cajun River Bend Interest has been dictated in large part by the River Bend Order. The Court has previously approved that order and the procedures set forth thereunder. The Court has ample authority to provide for the disposition of estate assets and, therefore, to provide procedures for the sale of assets including procedures for competitive bidding of an asset. Van Huffel v. Markelrode,284 U.S. 225, 227, 52 S.Ct.115,116 (1931)(sale power is implicit in coun); In re Summit Coro.,
891 F.2d 1 (1st Cir.1989)(coun has plenary power to provide for competitive bidding).
The procedures followed in this case are designed to produce the best offer for the Cajun =
River Bend Interest. The topping fee allowed to PECO will not chill any bidding or prevent the process from producing the best sale price for the asset. The topping fee will be deducted from
- the net sale proceeds payable to RUS and, thus, will have no effect of the estate.
Also, it is appropriate to defer to RUS with respect to the acceptance or rejection of competing offers for the Cajun River Bend Interest. Couns routinely defer to the " business judgment" of debtors in possession or trustees with respect to the sale of estate property. Ett tJL n re After Six Inc.,154 B.R. 876 (Bankr. E.D. Pa.1993). In this case, it is the Trustee's I
judgment to allow RUS, in accordance with the River Bend Order, the right to determine what 2
L constitutes the best offer for the Cajun River Bend Interest. It is RUS which holds a lien on the Cajun River Bend Interest to secure several billion dollars of loans and loan guarantees to Cajun.
Although the sale price has not yet been disclosed, it is clear that the purchase price will be a small fraction of amounts owed to RUS on account of moneys it advanced or guaranteed to Cajun for its investment in the River Bend plant. The Trustee has not disputed and does not believe thervRists a basis to dispute, successfully, the RUS lien in the Cajun River Bend Interest. Accordingly, any sale of the asset free and clear of liens requires the consent of RUS under section 363(f) of the bankruptcy code. Thus, any sale of the Cajun River Bend Interest may be subject, effectively, to veto by RUS. Accordingly, it is not only appropriate, but expedient and necessary that RUS approve or disapprove any sale offer.
2.
The Sale of the Caiun River Bend Interest is In the Best Interests of the Caiun Estate and its Creditors.
Sales of estate property must be in the best interests of a debtor's estate and its creditors, and ideally, should further the debtor's proposed reorganization. In re Continental Air Lines.
In,780 F.2d 1223 (5th Cir.1986)(examining benefit of sale to creditors and effect of sale on future plan of reorganization).
As stated above, the sale of the Cajun River Bend Interest is driven and set forth by the procedures set forth in the River Bend Order. The River Bend Order effectively allows for the reorganization of Cajun by providing for the divestment of Cajun of an interest that was otherwise burdensome to the estate. Accordingly, because the River Bend Order facilitates reorganization, the sale of the Cajun River Bend Interest as contemplated by such order is also in the best interests of the estate.
3
3.
The Sale of the Caiun River Bend Interest May Be Made Free and Clear of all Liens and Interests.
- Section 363(f) of the bankruptcy code allows for a sale free and clear of all liens and interests if the party holding the lien or interest consents to the sale, in this case, RUS, which is the sole lienholder in the Cajun River Bend Interest, has consented. Furthermore, to the
- extent GSU might be deemed to hold any interest in the Cajun River Bend Interest, it has also, in the River Bend Settlement, consented and agtted :o coopc ate in the proposed sale, 4.
The Sale of the Caiun River Bend Interest Is Made in Good Faith.
Sales of a debtor's property are made in good faith when they are negotiated at arm's length and are free of collusion or fraud. In re Ewell,958 F.2d 276,281 (9th Cir.1992); in re Rock Indn=tries Machinery Coro. 572 F.2d 1195,1198 (7th Cir.1978). PECO is not an insider of any of the parties to the transaction and has made an offer for the property at arms' length. The Trustee has averred that good faith exists with respect to this transaction and the procedures approved in the River Bend Order which are designed to produce the best offer for the Cajun River Bend Interest.
WHEREFORE, the Trustee prays that the Court approve the Motion.
4
DATED this 24 day of April,1997.
KANTROW, SPAHT, WEAVER, and BLITZER A Professional Law Corporation G /k David S. Rubin (Louisianayar #11525)
Connell L. Archey (LouisMna Bar #20086) ~
Suite 300, City Plaza 445 North Boulevard P.O. Box 2997 Baton Rouge, Louisiana 70821-2997 Telephone No.: (504) 383-4703 Kenneth L. Cannon H (Utah Bar No.3705)
Lon A. Jenkins (Utah Bar No. 4060)
LeBOEUF, LAMB, GREENE & MacRAE, L.L.P.
1000 Kearns Building 136 South Main Street Salt Lake City, Utah 84101 Telephone No.: (801) 320-6700 Counsel for Ralph R. Mabey, Chapter 11 Tntstee for Cajun Electric Power Cooperative, Inc.
moAv;wm2 mms.Aosmuviso.um 5
IN THE UNITED STATES BANKRUPTCY COURT
( 70K THEiMIDDI.E DISTRICT OF LOUISIANA
- 1,ci
)
Inre:
- ~ - ~
)
CIVIL ACTION
)
NO. 94-2763-B2 CAJUN ELECTRIC POWER
)
COOPERATIVE, INC.,
)
BANKRUPTCY CASE
)
NO. 94-11474 Debtor.
)
)
Chapter 11 Federal Tax Id. No.. 72-%55799
)
)
QRDER APPROVING MOTION OF RALPH R. MABEY. CHAPTER 11 TRUSTEE. TO SELL RIVER DEND INTEREST FREE AND CLEAR AND TO ASSUME AND ASSIGN EXECUTORY CONTRACTS This matter coming to be hearing on the Motion (the " Motion") of Ralph R. Mabey, Chapter 11 Trustee (the " Trustee") for Cajun Electric Power Cooperative, Inc. (" Cajun"),
brought in exercising the authority provided to him by the Order and Judgment Approving Settlement By and Among Cajun Electric Power Cooperative, Inc., Entergy Gulf States, Inc.,
Entergy Corporation, and the Rural Utilities Service of the Department of Agriculture entered by the United States District Court for the Midd'e District of Louisiana on August 26,1996 (the
" River Bend Order"), to confirm that the following actions comply with the terms of the River Bend Order: (1) the Trustee's sale, pursuant to section 363, of Cajun's 30% interest in the River Bend nuclear generating facility and related assets (the " Cajun River Bend Interest") free and clear of liens and encumbrances pursuant to agreement between Rural Utilities Service of the United States Department of Agriculture ("RUS") and PECO Energy Company ("PECO"),
and (2) the Trustee's assumption of the Joint Ownership Participation and Operating Agreement,
. River Bend Unit 1 Nuclear Plant, as amended (the " River Bend JOPOA"), and his assignment thereof.
Upon consideration of the Motion, due and proper notice having been provided thereof to parties entitled thereto, and on the basis of the record of this case, it appearing that the. sale as set forth in the Motion in furtherance of the River Bend Settlement is commercially reasonable angat PECO is purchasing' the Cajun River Bend Interest in good faith, and pursuant to 11 U.S.C. I 363, Fed. R. Bankr. P. 6004, and the River Bend Order:
The Court having considered all objections to the Motion not withdrawn, if any,;.
The Court is of the opinion that the Motion is meritorious; accordingly, IT IS ORDERED THAT:
1.
The Motion is granted.
2.
' All objections are denied with prejudice.
3.
The sale of the Cajun River Bend Interest free and clear of liens and encumbrances as set forth in the Motion and the River Bend Settlement is approved.
4.
The Trustee's assumption and assignment of the River Bend JOPOA is approved.
5.
PECO is entitled to the benefit of 11 U.S.C. I 363(m) as a good faith purchaser.
6.
The Trustee, RUS, and PECO are hereby authorized to execute, deliver, and perform their respective obligations with respect to the sale of the Cajun River Bend Interest and to execute any and all other documents, instruments and agreements and to take any and all 2
actions necessary to complete the sale of the Cajun River Bend Interest, Baton Rouge, Louisiana, this day of
,1997.
Honorable Frank J. Polozola United States District Judge i
H2AVpWNedO4\\PL2ADSWIJVSEND.ORD 3
3 UbTTED STATES BANKRUPTCY-COURT MIDDLE DISTRICT OF LOUISIANA 4
-)
Inre:
)
CIVIL ACTION
)
= NO. 94-2763-B2 CAJUN ELECTRIC POWER
)
COOPERATIVE, INC.,
)
BANKRUPTCY CASE -
)
NO. 94-11474 Debtor.
)
)-
Chapter 11 Federal Tax Id. No.: 72-0655799
)
CERTIFICATE OF SERVICE I hereby certify that I have mailed a copy of the following pleadings to all persons shown on Exhibit A attached hereto on the 2'l day of April,1997, 1.
Motion of Ralph R. Mabey, Chapter 11 Trustee to Sell River Bend Interest Free and Clear and To Assume and Assign Executory Contracts 2.
Proposed Order Approving Motion of Ralph R. Mabey, Chapter 11 Trustee, to Sell River Bend Interest Free and Clear and to Assume and Assign Executory Contracts 3.
Memorandum in Support of Motion of Ralph R. Mabey, Chapter 11 Trustee, to Sell River Bend Interest Free and Clear and to Assume and Assign Executory Contracts Connell L. Areg 1
I
-M
i Noram Energy Services, Inc Westero Fuels. las.
Dady laschts. Inc.
e/o Edward B. Poitevent, D 4301 Wdson Blvd., Susie 805 JAF Boa 3127 400 Poydras Stact,2sth Floor Arlington VA 22203 -
New York NY 10116 New Orleans LA 70130 Benjamin C. Ackerly Gerald Amero Marc F Barker Hunton & W%ams Pierce. Atwood, Scnboer, Allco 12193 Cypress Ct.
Rmarm Plaan, !!th F1,951 E. Byrd St.
One Monument Sciua" Jarreau LA 70749 Richmond VA 23219 Portland ME 04101 Marc F. Barker Steven Baron Larry Belluzzo William L. Downias & Assoc.
Omca of the Atty. Gen. Natural Resources Dw t!.S. Dept. of Agriculture P. O. Boa 45212, Dept. 398 P.O. Boa 12548 14th & lodependcoce Ave, S.W., Rm. 40 Baton Rouge LA 70895 Austin TX 78711 Washington DC 20250 Larly Brandman Mr. Robert Brautovich, Manager Mr. Jim B. Brown CS First Boston Burliestae Northern Radroad Central and South West Corporation SS E. 52nd Street 3700 Contionstal Plaan,777 Main Strat 1616 Woodall Rodgers Freeway New York NY 10055 Fort Worth TX 67102 5384 Dallas TX 75202 Mr. Joe H. Bynum Mary Ca'herine Cali Mr. Ronald J. C'alise Big River todustnes, lac.
Shows, C An & Cali Wasserstee Persua & Co,Inc.
3085 E.Shadowlawn Avenus,N.E.
P. O. Drswer 4425 31 Wat $2nd St Atlanta GA 30305 Baton Rotge LA 70821 New York NY 10019 Sonia U, Chae Mr. Peter A. Chapman Stephen Chiccarelli 500 W. Madison. Suits 1400 301 N. Harrison Street, haite 206 Bnamale, Saches & Wilson
- Chicago IL 60661-2511 Princeton NJ 08510 P. O. Boa 3197 Baton Rouge LA 70821 Melanie Rovner Cohen Carolyn S. Ccle Brendan Collins Altheisner & Oray Omce of the U.S.Trus'se Conunarcial Litigation Branch 10 South Wacker Dem, Suite 4000 Texaco Ctt,400 Poydras St., $te 2110 Boa 875. Den Franklin Station Chicago IL 60606 New Orleans LA 70130 Washington D.C. 20004 Mr. Gary L. Conlay.
Gail A.Crowell James J. Davidson VaDay Eascaric Membership Corporation Counpton. Crowell & Hewitt Davidson, Meaux, Soemer. McEllisott & !
P. O. Boa 1188 P. O. Drawer 1937 P. O. Drawer 2908 Natchitoches LA 714581188 Biloxi MS 39533-1937 Lafayette LA 70502 John J. Dawson -
Al Ewing Matt J. Farley Str ch1.a.:
713ta41:
Deutsch Kernsen&Stua 2 N. Central Avenue., R=====c~ Oo*
Batchelor LA 70715 755 Masam Sensi Phoenix AZ 85004 New Orleans LA 70130-267 George M. Fleming Michael R. Fontham Mr. Anthony R. Francoise Pubiac Utiliues Stafr Stone, Pigman. Walther, wittman & Hutchinson Tbs Fosboro Company P. O. Boa 1174 544 Carondelet Street Mail Stop B52.lK,33 Comunercial Sir Jackson MS 39215-1174 New Orleans La 70130 Foxboro MA 02035
l Joe Friend James M. Funderburk Henry C. Gahagan, Jr.
~
Bronseale. Sachse & Wilson, L LP.
Duval. Funderburk Sundbury & Lovell
- Gaharan & Contay
- , m Poydras Strat, Suite 2400, LL&E Tower 101 Wilson Avenue. P. O. Box 3017 P. O. Boa lits New Orleans LA 70112 Houma LA 70361 Natchitoches LA 71457 Irving D. Gaines Peter Glaser Nancy Gregoris Galass bw Ofr.:ss Doherty, Rumble & Butler Air Products and r%-+_4. lac.
312 E. Wisconsin Ave., Ste.20s 1401 New York Avenue. Suite 1100 7201 Hamilton Blvd.
Milwaukee WI 53202 Washington DC 20005 Allentown PA 181951501 -
Carl H. Hanchey Mr. Robert H. Harrison, Jr.
W. Lake Hearne Jones Tete, Notes, Haochry. M & Spears P. O. Bot 1165 A. J. Weller Corporsuon P. O. Boa 910 Denham Springs LA 70727-1165
'd13 Th"alull ^wous. 2nd Flow, Sune Lake Charles LA 70602 Shreveport LA 711061509 Mr. JelTrey P. Hemmel Patrick E. Henry Mr. David R. Hunt Mineouri Dept. of Revenus, Bankruptcy Umt Shaw. Waver & Henry, L.L.C.
Hunt & Ross P. O. Bos 475 522 East Wim Street, P. O. Bos 239 123 Court Suust. P. O. Bos 1196 JefTerson City MO 65105-0475 Homer LA 71040 Clarksdale MS 38614 Mr. John W. Hutchison Internal Revenue Service Brian A. Jackson Voothies & Labbe APLC Atta: DistrictCounsel Assistaat U.S. Attorney
- 700 St. John Strost P. O. Bos 30509 777 Florida Strat. Suite 208 Lafayecte :A 70501 New Orleans LA 70190 Baton Rouge LA 70801 Lon Jenkins Patrick Johnson Henry J. Kaim LaRosuf Lamab Ormos 1 MacRae lamie & Kelleher Sheinfeld, Malay & Kay 1000 Konras Balding.134 Main Street Pam Am Life Censer,601 Poydras St, Ste. 2100 -
1001 Fannia.Ste. 3700 Salt Lake City UT 84101 New Orleans LA 70130 Houston TX 77002 Mr. William N. Knight Bryan Krakauer Nicholas F. LaRocca, Jr.
Jdrerson Davis Electnc Cooperauve, lac, suusy & Austia A Professiooni Law Corporation P. O. Drawer 1229 -
One First National Plaan P. O. Box 2466 Jennings LA 70546 Chicago IL 60603 Morgan City LA 70381-246 James R. Lackie Charles A.Landry Daniel Larcamp Kaa. Miller
' Joess, Walker, Waschter. Poitewat, (.arree Federal Energy Regulatory Comuassu P. O. Box 3513 4555 Umsed Plass Blvd.,4 United Plaza,5th F 825 N. Capitol St.Rm 3010A Baton Rouge LA 70821 Baton Rouge LA 70809-7000 Washington DC 20426 Ms. Edna A. Latchem Mr. Jeffrey Levinson Adam A. Lewis P.O.Bos36 w Fr,-n*,Coplan & Aronoir Morrison & F rster Baton Rouge LA 70821 23W BP Amancan Bids.,200 Public Sq.
345 California Strat Cleveland OH 44114 San Francisco CA 94104-26' Peter J. Lucas Charles N. Malone George Marcus Dobsety. Rumble & Butler, P.C.
A:torney at bw Marcus, Grygiel & Clegs. PA.
120017thStreet Suite 2370 2501 Nicholson _Dnvc -
100 Middle Streat, East Tower Denver CO 80202 Baton Rouge LA 70802 Portland ME 04101
A Mr. Robert C. Marshall Ron Martin Richard E. Matheny Trouunne Sanders LLP -
Houand & Hart :
Phelps Dunbar,l L.P.
600 Punchtres Street NE, Swie $200 90 S. Camsde Avenus P.O. Boa 4412 Atlanta GA 30308 2216 Colroado Springs CO 80903 Baton Rouge LA 70821-441:
' Robert R. McBride -
A. Kell McInnis, III E. Rudolph McIntyw McAnde, Forst, Rozas & teenard Casua Electnc Power Mclotyre. Mclatyre & Mclotyre 1019 brayette Strat P.O. Box 15540 -
P. O. Boa 426
. Lafayette LA 70502 Baton Rouge LA 70895 Winnsboro LA 71295 John J. McKeithen Donald J. Morgan Mr. Hal F. Morris McKathen, McKeithen & Botunna 748 Main St.
Public Utility Ceauessmos of Teams
- 10771 Perkins Road, Sate B Bator Rouge LA 70801 P. O. Boa 12548, Natural Resources Baton Rouge LA 70810 Austin TX 787112548 John i' arks J. Kenton Parsons Alfredo R. Perez t4Boeuf haib Greens & MacRae, LLP Roedet Parseas. HiB & Koch BracewellI. Patternos. L.L.P.
633 Seventeenth Street 8440 JeGarson Highway, Smte 301 711 Lemmaan Street, Sete 2900 Denver CO 80202 Baton Rouge LA 70809 Houston TX 77002 2781 Mr. Michael T. Perry Tom F. Phillips Clint Pierson 8555 United Plaan,5th Floor Taylor.Poner, Brooks & PhiBips Tausy, Anthony, Hughe & Kasht -
Baton Rouge LA 70809 P. O. Drawer 2471 Acadena Bank Bids.,4565 LaSaDe St, Sic.
Baton Rouge LA 70821 Mandeville LA 70471 Ms. Sara Posada Russell Purvis
' Glenn M. Reisman -
Dept. of Revenue and Taastion Smith Taliaferro Siebert Booth & Purvis P.O. Boa 861 P. O. Boa 66658 P.O. Boa 2" Shelton CT 06481.
Baton Rouge LA 708%
Jonesville LA 71343 Michael A. Rosenthal Mr. David S. Rubin Mr. Dan MichaelScheuermar Oibeen, Duna & Crutcher -
Kaattow, Spaht, Weaver & Blitarr (APLC) 405 St. Ferdinand Street 1717 Main Street, Suite 5400 P. O. Boa 2997 Baton Rouge LA 70802
. Dallas TX 75201 Baton Rouge LA 70821
. Raymond L. Shapiro John Sharp William M. Shaw Blank. Rosne, Camisky & McCauley.
14481 Old Hammnoed Hwy Suite 2 Shaw & Shaw 1200 Four Penn Center Plaa*
Baton Rouge LA 70816 P. O. Boa 420 Philadelphia Pa 19013 Homer LA 71040
- Cassandra M. Silletti Southwestern Electric Power Com Barry Spears Air Products and th". lac.
Wh-Cannoody & Gilhans 100 Congram Ave, Ste. 800 7201 Hassikon Blvd.
P. O. Boa IN Austin TX 78701 Allentown PA 18195-1501 Shreveport LA 71166 Mr. Wesley W. Steen Stephen P. Strohschein James B. Supple winsted, Sechtest & Minick McGliachey Stafrord Lang Biggs Trowbndse Supp6s & Cranald 910 Travis Bids., Suite 1700 -
9th Floor.One Amancma Place P. O. Drawer 565 Houston TX 77002 5895
-Baton Rouge LA 70825 Franklin LA 70538
Frances Toole Sheila R Tweed R Patrick Vance Civil Dmmon, Dept. of Juma Enroe Capital & Trade Resources
- Jooss, Walker P.O. Dos 875, Ben Frankha Stauon 1400 Suuth Street, f.B3824; P. O. Bot i188 201 St. Charles Ave,49th Fl.
Washington DC 20044-0875 Houston TX 77251-1188 -
New Orleans LA 70170 Derren Watts Janet Weiss John C. Weitnauer Altheuner & Gray Gibson, Dunn & Crutcher Almon& Bud to South Wacker Dnve 200 Park Avuous One Atlaouc Center,1201 W. Punchtree Chicago IL 60606 New York NY 10166-0193 Atlanta GA 30309 Mr. Gary Williams Michael Yokell John D. Ziober AA Eqwpawat Roosals. Inc.-
Hasler Bailly Consulties, loc.
Shockey & Ziober 7815 Comuneros Dave P. O. D swer 0 P. O. Bos 80286 Bator4 Rouge LA 70815 Boulder CO 80306 Baton Rouge LA 70898 Marian Zobler Nuclear Regulatory Comumamon Washington DC 20555
IN THE UNITED STATES BANKRUPTCY COURT FOR THE MIDDLE DISTFJCT OF LOUISIANA'
)
In re:
)
CIVIL ACTION
)
NO. 94-2763-B2 CAJUN ELECTRIC POWER
)
COOPERATIVE, INC.,
)
BANKRUPTCY CASE
)
NO. 94-11474 Dettor.
)
)
Chapter 11 Feden! Tu Id. No.- 72 0655799
)
)
ORDEILAPEROVING MOTION OF R4LPH R. MABEY. CHAFF 1ER 11 nusn:L To SELL RIVER REND IvrEREST FREE AND Cf. EAR AND TO ASSUME AND ASSIGN 8tXECUTORY CONTRACTS This znaner cane on for heartng on the Motion (the " Motion') of Ralph R. Mabey, Chapter 11 Trustes (the
- Trustee *) for Cajun Electric Power Cooperauve, Inc. (" Cajun"),
brought in exercising the authority provided to him by the Order and Judgment Approving Setticment By and Among Cajun Electric Power Ccmp...dve,Inc., Enrergy Gulf States, Inc.,
Emergy Corporation, and the Rural Utilsnes Service of the Department of Agriculture entered by the United States Distnct Court for the Middle Diswict of Louisiana on Augua 26,1996 (the ' River Bend Order") and um Seulemes Term Sheet dated as of May 1,1996 mmong the Trustee scring on behalf of Cajun, Rmal Utiliues Service, and Gulf States Utilities (the " Term Sheet"), to confirm that the foHowing actions comply with the terms of the Rzycr Bend Order and the Term Sheet: (1) the sale, perrsuant to section 363 of the Bankruptcy Code and the Agreement dazed as of February 11,1997 between Rural Utilities Service and PECO Energy Company (the 'PECO Ag.-7, of all of CaNn's right, title, and interest in and tc the River Beni nuclear swA faci % and all tights arising pursuant to and as described in the River Bend JOPOA (bervaafter denned) and related w and as any relate thereto in iM,"n'.!!'" ""'
- o any way (the ' Cajun River Bend Interest") free and clear cf liem and encumbrances, and (2) the Truste='s assumption of the Joint Ownership Participation and CW=las Agreement.
River Bend Unit 1 Nuclear Plant, as sm,W (the ' River Bend JOPOA'), and his assigmnent thereof to PECO Energy Company ('PECO*).
Upon consideration of the Monon, doe and proper nonce having been provided thereof to parties entitled thereto in accordance with the applicable provisions of Rules 2002(a) and 6004 of the Federal Rules of Bankruptcy Procedure and as supplemented by the addhional notice provisions of this Order, and on the basis of the record of this case and the evidence proffered or presented and e ssa presented at the hearing, it appears that the sale as set s
forth in the Modon in furtherance of the River Bend Order and the Term Sheet is commercially reasonable, that the actions of the Trustee and Enral Utihees Semce ("RUS*) related to the sale are appropria',e and evi Lui with the River Bend Order and tbc Term Sheet, and that PECO is purchasing the Cajun River Bend Imerest in good faith, and that the sale should be approved pursuant to 11 U.S.C. i 363. Fed. R. Bankr. P. 6004, the River Bend Order, and the Term Sheet The Court, noong that no objections to the Motion have been filed, oral reasons havmg been given on the record, is of the opinion that the Modon is meritorious; accordingly, IT IS ORDERED THAT:
1.
The Modon is gransed.
2.
All objecnons are denied with prejudice.
3.
'Ibe sale of the C$m River Bend Interest to pECO frus and cicar of all liens and cacs.brances pursuant m the terms and codaions of the Purchase and Sale Agreement between the Trustee and PECO is confirmed as being in complias:e with the tenns and conditions as set forth in the Ma6on, the Term Sheet. the River Bend Order, and is approved.
iMJ"'i'.8'E ""'
2
A 4.
The sale of the Cajun River Bend Interest has been conducted in a commercially reasonable manner for a comroercially trasonable price.
5.
The Trusse's assuruption and assignment to PECO of the River Bend JOPOA pursuant to 11 U.S.C. I 365(a) and (f) is approved, to become effective upon the closing of the sale of the Cajun River EmiInterest.
6.
PECO is purchasing the Cajun River Bend Interest in good faith and, therefore, is entitled to the benefit of 11 U.S.C. { 363(m).
Subject to the reservation of claims by RUS against Cajun's estate set forth in 7.
paragraph 9, the conveyance from the Trustee to PECO is made free and clear of all claims which have been or could have been asserted by any third party against the Cajun River Bend huerest, and stiated Ital property, real rights, tangibles, meangibles, sad personal property, and all liens and encumbrances which are charges against or interest in the Cajun River Bond Interest which secure payment of debt or petformance of an obliganon by Cajun including, without limitation, those of taxing authorities.
8.
The Trustee, RUS, and PECO are hereby authorized to execute, deliver, and perform their respective otTiganons wish respect to the sana of the Cajun River Bend Interest, tlw transfer of the Trust Fund (as dann=d in the Term Sheet), and the assumption and assignment of the River Bend JOPOA, and to exeese any and all other docuLients, umruments and agree==mt< and to take any and all actions necessary to complete the sale of the Cajun River Bend Inscrest, the transfer of the Trust Fund, and the assumpoon and assignment of the River Bend JOPOA concurrent with the mns-nmarma of the River Bend sectiement.
9.
The releases by RUS of 1:s liens, cucumbrances, and claans against the Cajun River Bend laserest shall not consanne a waiver or release of the portion of RUS's claims DisNPd.U'L'i 3
S against Cajun that remain unsatisSed by receipt of the purchase price by Cajun or a waiver or release of its liens and encumbrances agamst non-River Bend usets of Cajun. The amount of RUS's cidm against Cajun shall be reduced only to the extent of RUS's receipt of proceeds from the sale. The proceeds of the sale are authonzed to be paid direcdy to RUS by PECO.
10.
Other partus who hold a lien or claim of record against the Cajun River Bend Interest are hereby ordered to execute, denver to PEco, and perform releases of such claims and liens and related documentation as they pertain to the Capin River Bend Interest.
11.
The Louiriana Public Service Commmion (*LPSC") has no objection to the safe of the Cajun River Bend Imetist to PECO and will issue an order of no opposition on or before June 11,1997. This Order is without prejudice to the right of the LPSC to attesqn to assert jurLW+ over the approval of the sale of other assets of Cajun or the right of Cafun or
}
the Trustee to assert that the LPSC is not required to approve a sale of C4)un's assets.
12.
The Trusse is authorized to assign and transfer to PECO the Trust Filad (as defined in the Term Sheet) in the amount of $125,000,000 in 1995 dollars as provided in the Motion, the R]ver *n " Order, the Tecn Sheet, and the Purchase and Sale Agteement. which Trust Fund is to be used solely for Decommissioning as defined in the Term Sheet.
13.
Within ten (10) busumas days from the date of entry of this Order, the Trustee shall mail notice of such entry dead the date of mailing together with a copy of this Order and the Motion and the Purchase and Sale Agreetneat to those persons and emities whose names and addresses are set forth on Exhibk A to this Order as well as the 'short service list" used in this case. If no wruten objections att filed within ten days of such madmg, this Order shall r_.
become final. In the event that an dd f.cn is fued within this tea #sy period, a hearing on such objection willbe prompdy set.
i^i.*U'i',M'!! ""
4
I L
3 14 The Trustes'a modon for approval of an extension of tuns for the consununation of the scalemes w==er!: ? by the Tmn Sheet (dedaad in the Motion as (tw ' River Bend Setdement') (1) u necessary to cceply with the PECO Tens Shost or (II) December 31,1p97, whichever first ocaus, is grumed.
15.
In the event that PECO tersninsics or withdraw N ofw to purchase the Cajun River Bend inwrest, or if for any other reason the sale to PECO is an consummated, parsgraph 18 of the Motion will govera de acdons of the Trustee, RUS, and OSU and the Cowt will enertain modons by any interested party for an order to mashme the consummado6 of the setdears as provided t%rse and to provi4c for en exisesion of thus to et!Isctuate the River Bend Seedomsat if agreement between the parnes is not :ov. bed.
16.
Nothing in tim PECO Term Sbset shall modify the Rher Bend Setdemen and if I
any of hs terans which confuct with tbs River Bend h are s6ective only between the s
RUS and PECO excqt the dase by wtdsk the River Bend Seulement ruust be consanmaesd.
17.
'Du Trusase is authorbed to bring such motions as he deems appropriate in furthermosa of tids Order and the trn% r=-
- "bereby.
18.
Nothing herein shall aNest or br, consausd as an adp+=% of the rights of any party in coan*reian with issues raised ' FM-M Mamharu F--
?" v. M=hev, s
Adversary Pr~ iN No. 9(> 1052.
Baton Range, r <=iaiaa= this tt day of May,1997.
a Q
/J_ J,1 1-g30 5/30/97
-y NOTICE MNLED TO- ~
Ranorable Praak J. Polceola on 5/10/97 av mm --
hhW Di,m'i!,1?"J ""'
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