declaration of jonathan a mitchell in s - mg declaration-1

7/29/2019 Declaration of Jonathan a Mitchell in S - Mg Declaration-1

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TOGUT, SEGAL & SEGAL LLPOne Penn Plaza, Suite 3335New York, New York 10119(212) 594-5000Albert TogutScott E. RatnerSteven S. Flores

Anthony F. Pirraglia

Counsel to the

Debtor and Debtor in Possession

UNITED STATES BANKRUPTCY COURTSOUTHERN DISTRICT OF NEW YORK---------------------------------------------------------------X

:In re: : Chapter 11

:DEWEY & LEBOEUF LLP, : Case No. 12-12321 (MG)

:Debtor. ::

---------------------------------------------------------------X

DECLARATION OF JONATHAN A.MITCHELL IN SUPPORT OF DEBTORS

APPLICATION PURSUANT TO SECTION 105(a) OFTHE BANKRUPTCY CODE AND BANKRUPTCY RULE 9019(a)FOR AN ORDER APPROVING A SETTLEMENT AGREEMENT

AMONG THE DEBTOR, THE OFFICIAL COMMITTEE OF FORMERPARTNERS, THE AD HOC COMMITTEE OF RETIRED PARTNERS OF

LEBOEUF, LAMB, LEIBY & MACRAE AND CERTAIN SETTLING PARTNERS

I, Jonathan A. Mitchell, make this declaration (the Declaration) under 28

U.S.C. 1746 and state:

1. I am in all respects competent to make this Declaration which Isubmit for all permissible purposes under the Federal Rules of Bankruptcy Procedure,

the Federal Rules of Civil Procedure and Federal Rules of Evidence in support of the

application of Dewey & LeBoeuf LLP, as debtor and debtor in possession (the Debtor,

DL or the Firm), pursuant to section 105(a) of the Bankruptcy Code and Bankruptcy

12-12321-mg Doc 978 Filed 02/07/13 Entered 02/07/13 21:40:02 Main DocumentPg 1 of 6


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Rule 9019(a) for an order approving a settlement agreement among the Debtor, the FPC,

the AHC and certain Settling Partners(the Motion).1

2. I am a senior managing director of Zolfo Cooper Management, LLC(Zolfo) and am the Chief Restructuring Officer (CRO) of the Debtor. The Debtor

approved my appointment as CRO to the Debtor effective May 16, 2012, and I have

functioned in such capacity since that time. On July 12, 2012, the Court authorized the

Debtor to engage Zolfo to perform services in furtherance of the wind down of the

Debtors operations. I make this Declaration based on personal knowledge.

3. If called upon to testify, I could and would testify competently tothe facts set forth herein.

Experience of Jonathan Mitchell and Zolfo

4. I have over 25 years of diversified business experience, providingboth interim management and advisory services to a variety of clients.

5. Zolfo is one of the worlds leading interim management, financialadvisory and litigation support firms, with a team of restructuring and litigation

specialists in North America, advising debtors, creditors, investors and court-appointed

officials in formal bankruptcy proceedings and out-of-court workouts, and has played

key roles in numerous public record engagements.

Negotiations with the Partner Committees

6. The Parties have been working to negotiate a settlement over thelast six months.

7. Professionals for the Debtor, the Collateral Agent and theCreditors Committee actively participated in the negotiation of the Settlement.

1 Capitalized terms not defined herein shall have the meaning ascribed to them in the Motion.



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8. The result of this collaborative effort is a Settlement Agreement,which I believe is fair, equitable, and in the best interests of the estate.

Proposed Settlement

9. The Settlement was negotiated with the Partner Committees andoffered to the 125 former partners (or, in some cases, their beneficiaries)represented bythe FPC and the AHC who received payments from any of DLs non-qualified

retirement plans or as of-counsel or special counsel compensation during the period

January 1, 2011, through the Petition Date, and who did not already agree to participate

in the PCP.

10. The Settlement primarily resolves the pending and threatenedlitigation involving the Partner Committees, as well as the disputed proofs of claim and

threatened litigation of the Settling Partners.

11. Constituents of the FPC and AHC (who have not already joined thePCP) have filed more than 80 proofs of claim asserting claims for more than $80 million.

The Debtor has objected to these claims.

12. Retirees who previously agreed to the PCP are not impacted by theSettlement and will continue their commitment to pay the amounts and to exchange

(and enjoy the benefits of) the broad multi-party releases set forth in their PCP

agreements.

13. The Settling Partners represented by the Partner Committees willnot participate in the PCP. Thus, they will not receive the benefits of the PCP,including, but not limited to, the protections of the Bar Order, a release from former

partners who decided to participate in the PCP or the ability to make their required

contributions over a three-year period of time.



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14. Each Settling Partner has agreed to, among other things, pay theSettlement Amount, which is the sum of:

i. The lesser of (a) 25% of combined of-counsel or special counsel compensationand non-qualified retirement plan payments paid by the Debtor and receivedby the Settling Partner in 2011 and 2012, or (b) $5,000;

ii. Reimburse 60% of any tax advances made by the Debtor on behalf of theSettling Partner during 2011 and 2012; and

iii. An amount calculated using the same progressive payment table applied informulating the PCP, on account of any other amounts received from theDebtor during 2011 and 2012.

The Settlement Agreement Is In theBest Interest of the Debtors Estate and Creditors

15. The Settlement Agreement should be approved because, amongother things, it (i) resolves the pending Appeals of the PCP Order without further

expense or delay; (ii) resolves all other pending disputes among the Settling Parties,

including, but not limited to, disputes relating to all Settling Partners proofs of claim;

(iii) guarantees the Settling Parties will not object to confirmation of the Debtors Plan;

(iv) caps, and significantly reduces, certain legal fees at issue in this case; and

(v) quickly brings additional cash into the Debtors estate.

16. The Settlement Agreement resolves (a) claims arising underChapter 5 of the Bankruptcy Code; (b) claims for reimbursement of tax advances;

(c) claims for unpaid capital contributions; (d) claims based on breaches of fiduciary

duty; and (e) claims based on contractual obligations under DLs partnership

agreement(s) and non-qualified retirement plans. The Debtor and its professionals

identified numerous defenses and counterclaims that former partners, including the

Settling Partners, might assert. Pursuing any or all of these claims would raise

significant and complex issues of fact and law, all of which carry litigation risk and

significant cost.



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17. Thus, I believe that the Settlement Agreement is fair and reasonablegiven the costs, delays and uncertainty associated with recovering from the Settling

Partners in the absence of an agreement with the Settling Partners.

18. Other pending disputes in this Bankruptcy Case that the SettlementAgreement resolves, include:

Resolution of the Appeals. The Settlement Agreement resolves the pendingAppeals. By settling with the only appellants to the PCP Order, theSettlement helps ensure that this critical global compromise is not unwound -- which represents a substantial benefit to the Debtor (and the more than 440former partners who are waiting for their PCPs to become effective).

Resolution of Confirmation-Related Disputes. Because the Settlement alsosecures support for confirmation of the Debtors Plan, the Debtor believesthat the Settlement will streamline confirmation proceedings, while reducingthe number of objections that will have to be resolved by the Debtor (or thisCourt).

Resolution of Claim-Related Disputes. The Settlement also resolvesdisputes concerning the Settling Partners proofs of claim, several of whichmay assert priority treatment under section 507 of the Bankruptcy Code.These claims will be deemed withdrawn upon the Effective Date of theSettlement Agreement, which will significantly reduce expenses and disputesrelated to claim reconciliation.

19. The Settlement Agreement was the result of extensive arms lengthnegotiations among my professionals and me, on behalf of the Debtor, and counsel for

the FPC, the AHC, the Collateral Agent, the Creditors Committee, all skilled and

experienced bankruptcy practitioners. As a result, I believe the Settlement represents a

hard-fought, negotiated bargain.

20. I believe the releases and other consideration exchanged pursuantto the Settlement Agreement are appropriate and necessary to consummate the

Settlement.



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21. The Debtor is informed that the Creditors Committee and SecuredLenders holding a majority of the Secured Lender Claims support approval of the

Settlement Agreement.

22. Accordingly, I can attest that, in the Debtors business judgment,the Debtors entry into the Settlement Agreement, and the Bankruptcy Courts approval

of the Settlement, is in the best interest of the Debtor, its estate, and its creditors.

Pursuant to 28 U.S.C. 1746, I declare under penalty of perjury that the

foregoing is true and correct.

Executed On: February 7, 2013

New York, New York /s/ Jonathan A. MitchellJONATHAN A. MITCHELLChief Restructuring OfficerDEWEY & LEBOEUF LLP


declaration of jonathan a mitchell in s - mg declaration-1

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