Presentment Date and Time June 28, 2017 at 1100 a.m. (Eastern Time) Pg 1 of 7 Objection Deadline June 21, 2017 at 1200 noon (Eastern Time) Hearing Date and Time (Only if Objection Filed) To be determined by the Bankruptcy Court WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, New York 10153 Telephone (212) 310-8000 Facsimile (212) 310-8007 Gary T. Holtzer Robert J. Lemons Garrett A. Fail Proposed Attorneys for Debtors and Debtors in Possession UNITED STATES BANKRUPTCY COURT SOUTHERN DISTRICT OF NEW YORK ------------------------------------------------------------ x In re Chapter 11 WESTINGHOUSE ELECTRIC COMPANY Case No. 17-10751 (MEW) LLC, et al., Debtors. 1 (Jointly Administered) ------------------------------------------------------------ x STIPULATION, AGREEMENT, AND ORDER BETWEEN WESTINGHOUSE ELECTRIC COMPANY LLC, PCI ENERGY SERVICES LLC, AND BARNHART CRANE AND RIGGING COMPANY SETTLING CLAIMS Westinghouse Electric Company LLC ( WEC ), PCI Energy Services LLC ( PCI ), and certain of their affiliates, as debtors and debtors in possession in the above-captioned 1 The Debtors in these chapter 11 cases, along with the last four digits of each Debtor s federal tax identification number, if any, are Westinghouse Electric Company LLC (0933), CE Nuclear Power International, Inc. (8833), Fauske and Associates LLC (8538), Field Services, LLC (2550), Nuclear Technology Solutions LLC (1921), PaR Nuclear Holding Co., Inc. (7944), PaR Nuclear, Inc. (6586), PCI Energy Services LLC (9100), Shaw Global Services, LLC (0436), Shaw Nuclear Services, Inc. (6250), Stone & Webster Asia Inc. (1348), Stone & Webster Construction Inc. (1673), Stone & Webster International Inc. (1586), Stone & Webster Services LLC (5448), Toshiba Nuclear Energy Holdings (UK) Limited (N/A), TSB Nuclear Energy Services Inc. (2348), WEC Carolina Energy Solutions, Inc. (8735), WEC Carolina Energy Solutions, LLC (2002), WEC Engineering Services Inc. (6759), WEC Equipment & Machining Solutions, LLC (3135), WEC Specialty LLC (N/A), WEC Welding and Machining, LLC (8771), WECTEC Contractors Inc. (4168), WECTEC Global Project Services Inc. (8572), WECTEC LLC (6222), WECTEC Staffing Services LLC (4135), Westinghouse Energy Systems LLC (0328), Westinghouse Industry Products International Company LLC (3909), Westinghouse International Technology LLC (N/A), and Westinghouse Technology Licensing Company LLC (5961). The Debtors principal offices are located at 1000 Westinghouse Drive, Cranberry Township, Pennsylvania 16066. WEIL\96115605\2\80768.0015
Pg 2 of 7 chapter 11 cases (collectively, the Debtors ), and Barnhart Crane and Rigging Company ( Barnhart and, together with WEC and PCI, the Parties and, each, a Party ), by and through their respective counsel, hereby enter into this stipulation, agreement, and proposed order (the Stipulation ) and represent and agree as follows RECITALS A. On March 29, 2017 (the Petition Date ), 2 each of the Debtors commenced with this Bankruptcy Court a voluntary case under chapter 11 of title 11 of the United States Code (as amended, the Bankruptcy Code ). The Debtors are authorized to continue to operate their business and manage their properties as debtors in possession pursuant to section 1107(a) and 1108 of the Bankruptcy Code. No trustee or examiner has been appointed in the Chapter 11 Cases. B. The Chapter 11 Cases have been jointly administered for procedural purposes only pursuant to Rule 1015(b) of the Federal Rules of Bankruptcy Procedure. C. Barnhart and PCI are parties to that certain purchase order, dated December 18, 2015 (P.O. Number 4500683225) (the First Purchase Order ), pursuant to which Barnhart agreed to provide PCI services related to certain feed water heaters. In connection with the First Purchase Order, pursuant to invoice number 239929, PCI became indebted to Barnhart for prepetition services as reflected in the Debtors books and records (the Barnhart First Purchase Order Claim ). D. During Barnhart s execution of its work under the First Purchase Order, PCI sustained damage to a feed water heater caused by Barnhart, resulting in direct costs to PCI to 2 Capitalized terms not otherwise defined herein shall have the meanings ascribed thereto in the Declaration of Lisa J. Donahue Pursuant to Rule 1007-2 of the Local Bankruptcy Rules for the Southern District of New York (ECF No. 4). 2
Pg 3 of 7 repair the damage and attendant delays (the PCI Claim #1 ). E. Barnhart and WEC are also parties to that certain purchase order, dated January 10, 2017 (P.O. Number 4500711089) (the Second Purchase Order ), pursuant to which Barnhart agreed to provide WEC services related to lifting and rigging of equipment at the port of Philadelphia. In connection with the Second Purchase Order, pursuant to invoice number 99000318, WEC has become indebted to Barnhart for prepetition services as reflected in the Debtors books and records (the Barnhart Second Purchase Order Claim ). F. Barnhart and PCI are parties to that certain purchase order, dated June 21, 2016 (P.O. Number 4500696458) (the Third Purchase Order ), pursuant to which Barnhart agreed to provide PCI with an engineer s report for certain other feed water heaters (the Report ) on May 17, 2017 (the PCI Claim #2 ), at which time PCI would remit final payment to Barnhart for the Report and for all incremental work performed in connection therewith. Upon delivery of the Report, PCI will have incurred indebtedness of $40,183.52 in connection with the Third Purchase Order, pursuant to invoices 9900112, 99003098, 99004883, 99007390, and 990010184 (the Barnhart Third Purchase Order Claim and, together with the Barnhart First Purchase Order Claim, and the Barnhart Second Purchase Order Claim, the Barnhart Claims ). As of the date hereof, Barnhart has not yet provided PCI with the Report. G. Barnhart and WEC are also parties to that certain purchase order, dated January 22, 2016 (P.O. Number 4500684911) (the Fourth Purchase Order ), pursuant to which Barnhart agreed to provide WEC engineering services for a rigging and lifting plan for removal and installation of feedwater heaters at the Salem Nuclear Generating Plant Unit #1. Pursuant to the Fourth Purchase Order, Barnhart owes performance of first-iteration comment resolutions or 3
Pg 4 of 7 revisions based on customer comments. H. On April 27, 2017, PCI issued a change notice to Barnhart in connection with the Third Purchase Order to increase the time and materials necessary to complete the scope of work pursuant thereto (the Change Notice ). As of the date hereof, Barnhart has not acknowledged the Change Notice. I. In order to obtain a consensual resolution in an expedient manner with respect to the Barnhart Claims, and the PCI Claims, the Parties have agreed to settle such claims. J. The agreement between the Parties as set forth in this Stipulation was negotiated between the parties at arms-length. Based on the foregoing facts, and in consideration of the foregoing, IT IS HEREBY ORDERED, STIPULATED AND ADJUDGED AS FOLLOWS 1. This Stipulation shall become effective and binding immediately upon its approval and entry by the Bankruptcy Court (the Effective Date ). The parties have also entered into a vendor trade agreement to be effective upon Court s approval of this Stipulation which provides for the application of customary trade terms for all open and future purchase orders which are not related to the U.S. AP1000 Projects. 2. In full satisfaction of any current or future claims of indebtedness of either Barnhart or WEC, whether known or unknown, which either Party has, or may have had, against the other Party, whether or not apparent or yet to be discovered, or which may hereafter develop, for any acts or omissions related to or arising from the First Purchase Order and the Second Purchase Order, including, but not limited to the Barnhart First Purchase Order Claim, the Barnhart Second Purchase Order Claim, and the PCI Claim #1, within the earlier of thirty (30) days of the Effective Date or two (2) days from Barnhart s collection of its insurance claim proceeds from its 4
Pg 5 of 7 carrier related to PCI s Claim, Barnhart shall remit the sum of $327,000.00 to WEC (the Barnhart Payment ), in accordance with instructions provided by PCI to undersigned counsel for Barnhart. Remittance of the Barnhart Payment to PCI fully satisfies both Barnhart s and PCI s rights with respect to the First Purchase Order and the Second Purchase Order as well as fully satisfying the PCI Claim #1. 3. Within four hours of the Stipulation and Supplier Pre-Petition Settlement Agreement being signed by both Parties, Barnhart shall (a) deliver the Report to PCI, and (b) acknowledge the Change Notice in a writing to undersigned counsel for PCI (the Acknowledgement ). 4. Within two (2) weeks of receiving clarification of Barnhart questions to customer comments, Barnhart agrees to provide the first-iteration comment resolutions and revisions based on customer comments under the Fourth Purchase Order. In full satisfaction of any current or future claims of indebtedness of PCI to Barnhart, whether known or unknown, which Barnhart has, or may have had, against PCI, whether or not apparent or yet to be discovered, or which may hereafter develop, for any acts or omissions related to or arising from the Barnhart Third Purchase Order Claim, within two (2) business days of receiving the Report, PCI shall remit $122,684.67 (the PCI Payment ) to Barnhart in accordance with instructions provided by Barnhart to undersigned counsel for PCI. 5. This Stipulation contains the entire agreement between the Parties and supersedes all prior agreements and undertakings between the Parties relating thereto. 6. This Stipulation may be signed in counterpart originals, which, when fully executed, shall constitute a single original. 7. Nothing in this Stipulation shall be considered an admission of any breach, 5
Pg 6 of 7 wrongdoing, negligence, omission, liability or fault on the part of either of the Parties. The Parties are entering into this Stipulation as a commercial compromise on disputed claims and solely to resolve the claims that are addressed herein. Nothing in this Stipulation, nor anything done pursuant hereto, shall be deemed or construed as modifying, or establishing any precedent, interpretation, or course of dealing under any contract or agreement made between the Parties. 8. Nothing in this Stipulation affects the rights of the Debtors or Barnhart with respect to any claims relating to work performed by Barnhart for the U.S. AP1000 business. 9. This Stipulation may not be modified other than by a signed writing executed by the parties hereto or by further order of the Bankruptcy Court. 10. Each person who executes this Stipulation on behalf of a party hereto represents that he is duly authorized to execute this Stipulation on behalf of such party. 11. This Stipulation will be exclusively governed by and construed and enforced in accordance with the laws of the State of New York, without regard to its conflicts of law principles, and all claims relating to or arising out of this Stipulation, or the breach thereof, whether sounding in contract, tort, or otherwise, will likewise be governed by the laws of the State of New York, excluding New York s conflicts of law principles. The Court will retain exclusive jurisdiction over all disputes arising from or relating to this Stipulation. 6
Pg 7 of 7 Dated New York, New York May [ ], 2017 Dated [Location] May [ ], 2017 By Gary T. Holtzer Robert J. Lemons Garrett A. Fail WEIL, GOTSHAL & MANGES LLP 767 Fifth Avenue New York, New York 10153 Telephone (212) 310-8000 Facsimile (212) 310-8007 By [BARNHART COUNSEL INFO] Attorneys for Barnhart Crane and Rigging Company Proposed Attorneys for Debtors and Debtors in Possession SO ORDERED Dated New York, New York July 28, 2017 s/michael E. Wiles UNITED STATES BANKRUPTCY JUDGE 7