ORDER PURSUANT TO SECTION 365 OF THE BANKRUPTCY CODE AUTHORIZING THE ASSUMPTION OF CERTAIN EXECUTORY CONTRACTS AS MODIFIED AND GRANTING RELATED RELIEF
ARTHUR J. GONZALEZ, United States Bankruptcy Judge
Upon consideration of the motion (the "Motion") of WorldCom, Inc. and certain of its direct and indirect subsidiaries, as debtors and debtors in possession, (the "Debtors") for an order pursuant to section 365 of the Bankruptcy Code, seeking authority to assume the Verizon East BC Agreement and the Verizon West BC Agreement (the "Billing Services Agreements"), as extended under the terms of the Assumption Agreement, all as more fully set forth in the Motion; and the Court having jurisdiction to consider the Motion and the relief requested therein pursuant to 28 U.S.C. § 157 and 1334 and the Standing Order of Referral of Cases to Bankruptcy Court Judges of the District Court for the Southern District of New York, dated July 19, 1984 (Ward, Acting C.J.); and consideration of the Motion and the relief requested therein being a core proceeding pursuant to 28 U.S.C. § 157(b); and venue being proper before this Court pursuant to 28 U.S.C. § 1408 and 1409; and due and proper notice of the Motion having been provided in accordance with the case management order of this Court, dated July 29, 2002, and no other or further notice need be provided; and the Court having considered the Motion, the papers in support thereof and the responses thereto, if any; and the Court having found and determined that the relief requested in the Motion is an exercise of the Debtors' sound business judgment and is in the best interests of the Debtors and their estates and creditors; and the Court having found and determined that the legal and factual bases set forth in the Motion establish just cause for the relief granted herein; and upon all of the proceedings had before the Court and after due deliberation and sufficient cause appearing therefor
Capitalized terms used herein and not otherwise defined shall have the meaning given to them in the Motion or in the Assumption Agreement.
IT IS HEREBY ORDERED THAT:
1. The Motion is granted.
2. The Assumption Agreement is approved in all respects. Failure to mention in this Order any provision of the Assumption Agreement shall not impair the efficacy thereof, it being the intention of this Order to approve all provisions of the Assumption Agreement. In the event of any inconsistency between the Assumption Agreement and the summary of any term thereof in the Motion or in this Order, the Assumption Agreement shall control.
3. The Debtors' assumption of the Billing Services Agreements as modified pursuant to the Assumption Agreement is approved.
4. The Verizon Entities are granted relief from the automatic stay, as provided in the Assumption Agreement.
5. Upon entry of this Order, the Debtors shall pay to Verizon the cure amount due and owing to Verizon under the Billing Services Agreements, which amount shall not be less than $34.527 million, but may be adjusted upwards upon agreement by Verizon and the Debtors, or as provided in the Assumption Agreement. The Debtors shall cure all defaults under the Billing Services Agreement.
6. Nothing in this Order shall prejudice the Debtors' or the Verizon Entities' respective rights, claims and defenses (including, without limitation, any rights, claims and defenses of setoff and recoupment) with respect to the Remaining Verizon Prepetition Claim and the Prepetition MCI/WorldCom Claim. Nothing in the Assumption Agreement shall constitute an admission of any kind with respect to any issue relating to setoff or recoupment, including, without limitation, any issue relating to mutuality of parties or obligations, or with respect to any issue otherwise relating to the Remaining Verizon Prepetition Claim and the Prepetition MCI/WorldCom Claim.
7. Subject to the terms of the Standstill Period, Verizon may retain and place an administrative freeze on the full amount that the Debtors allege that Verizon owes them with respect to the PARs that Verizon is holding, as well as additional amounts that the Debtors claim that Verizon owes them for other claims (the "Administrative Freeze"). The continuation of the Administrative Freeze, and the absence of any motion by Verizon for relief from the automatic stay under Section 362 of the Bankruptcy Code to the extent necessary to permit a setoff, shall not be deemed a violation of the automatic stay during the Standstill Period (as hereafter defined). Nothing herein is intended to determine that any continuation of the Administrative Freeze after the expiration of the Standstill Period shall be in violation of the automatic stay, and the Debtors and Verizon shall retain all rights, claims, and defenses with respect thereto. The Standstill Period shall begin on the Commencement Date and continue through and including 15 days after written notice of termination of the Standstill Period is given by the Debtors, which notice may not be sent by the Debtors any time before 30 days after entry of this Order.
8. This Order shall be effective and enforceable immediately upon entry and shall not be stayed pursuant to Bankruptcy Rule 6004(g).