EXHIBIT B Declaration of Ronald R. Levine, II
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EXHIBIT B Declaration of Ronald R. Levine, II IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE In re Chapter 11 DELTA PETROLEUM CORPORATION, et al.,1 Case No. 11-14006 (KJC) Debtors. (Jointly Administered) DECLARATION OF RONALD R. LEVINE, II AND DISCLOSURE STATEMENT OF DAVIS GRAHAM & STUBBS LLP IN SUPPORT OF DEBTORS’ APPLICATION PURSUANT TO SECTIONS 327(e) AND 328(a) OF THE BANKRUPTCY CODE AND FEDERAL RULE 2014(a) FOR AUTHORIZATION TO EMPLOY AND RETAIN W DAVIS GRAHAM & STUBBS LLP AS SPECIAL CORPORATE COUNSEL TO THE DEBTORS Ronald R. Levine, II makes this declaration under 28 U.S.C. § 1746, and states: 1. I am a member of the firm of Davis Graham & Stubbs LLP (“Davis Graham” or the “Firm”), which maintains offices for the practice of law at 1550 Seventeenth Street, Suite 500, Denver, Colorado 80202. I am duly licensed in and am a member in good standing of the bar for Colorado. 2. I submit this Declaration to provide the disclosure required under rules 2014(a) and 2016(b) of the Federal Rules of Bankruptcy Procedure (the “Bankruptcy Rules”) in connection with the application (the “Application”), dated December 23, 2011, of the debtors and debtors in possession (collectively, the “Debtors”) in the above-captioned chapter 11 cases (the “Chapter 11 Cases”) for approval of the Debtors’ retention of Davis Graham as its special corporate counsel in the Chapter 11 Cases pursuant to sections 327(e) and 328(a) of title 11 of 1. The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification number are: Delta Petroleum Corporation (0803), DPCA LLC (0803), Delta Exploration Company, Inc. (9462), Delta Pipeline, LLC (0803), DLC, Inc. (3989), CEC, Inc. (3154), Castle Texas Production Limited Partnership (6054) and Amber Resources Company of Colorado (0506). The Debtors’ headquarters are located at: 370 17th Street, Suite 4300, Denver, Colorado 80202. the United States Code (the “Bankruptcy Code”). Unless otherwise stated in this Declaration, I have personal knowledge of the facts set forth herein. To the extent any information disclosed herein requires amendment or modification upon Davis Graham’s completion of further review or as additional party in interest information becomes available to it, I will submit a supplemental declaration to the Court reflecting such amended or modified information. 3. Neither I, Davis Graham, nor any member, counsel to, or associate of the Firm represents any entity other than the Debtors in connection with these Chapter 11 Cases. In addition, except as set forth herein, to the best of my knowledge, after due inquiry, neither I, Davis Graham, nor any member, counsel to, or associate of the Firm represents any party in interest in the Chapter 11 Cases in matters related to the Chapter 11 Cases. Services to be Rendered 4. The Debtors have requested that Davis Graham act as its special corporate counsel on various matters, including, for example, in a broad range of corporate matters ranging from debt and equity financing transactions, merger and acquisition transactions, oil and gas and related regulatory matters, corporate governance, securities law compliance, preparation of the Debtors’ filings pursuant to the federal securities laws, and other matters. Davis Graham also stands ready to perform such other legal services as are within the scope of the matters on which Davis Graham has been retained that may be necessary and appropriate for the efficient and economical administration of these Chapter 11 Cases. Davis Graham has extensive expertise in providing services similar to the matters for which Davis Graham has been retained. Statement of Connections 5. In preparing this Declaration, I have followed our Firm’s conflicts procedures, including having the Firm’s client database reviewed and an inquiry made to Firm attorneys and employees via electronic mail about relationships with the list of Potential Parties- 2 in-Interest, which include the categories of entities and individuals listed on Exhibit “1” attached hereto (the “Retention Checklist”). 6. Davis Graham has in the past represented and may in the future represent a limited number of entities that are claimants or interest holders of the Debtors in specific matters unrelated to the Chapter 11 Cases. Davis Graham currently represents CalFrac, ConocoPhillips, Chevron and EnCana, each of which has a variety of contractual relationships with the Debtors, with respect to various oil and gas matters. We have also represented, and will continue to represent, certain of the banking institutions identified in Sections 1 (c) and 1 (d) of Exhibit 1. Davis Graham does not represent any of those entities in any matters relating to the Debtors or with respect to any claim they may have against the Debtors relating to the Chapter 11 Cases. Davis Graham also currently represents at least one of the parties who has done substantial diligence to consider becoming a stalking horse bidder for substantially all of the Debtors’ assets, but does not represent any such party in any matters relating to the Debtors or with respect to such party's negotiations with the Debtors in connection with the Asset Sale. 7. Based on the foregoing, insofar as I have been able to ascertain after diligent inquiry, I believe Davis Graham neither represents nor holds any interest adverse to the Debtors or their estates with respect to the matters on which Davis Graham is to be employed. 8. Davis Graham has rendered legal services to the Debtors and its subsidiaries since prior to 2006. Davis Graham has represented the Debtors in connection with corporate and regulatory issues arising during the preparation of the Chapter 11 Cases. 9. Davis Graham is not a creditor of the Debtors. During the twelve (12) month period prior to the commencement of these Chapter 11 Cases, Davis Graham received from the Debtors an aggregate amount of $1,442,009.84 for professional services performed and 3 expenses incurred . Davis Graham received from the Debtors an advance payment in the amount of $300,000.00 to cover an estimate of charges for professional services performed and to be performed, and expenses incurred and to be incurred, in connection with the preparation of these Chapter 11 Cases. Davis Graham has used the advance payment to credit the Debtors’ account for Davis Graham’s estimated charges for professional services performed and expenses incurred up to the time of the commencement of the Chapter 11 Cases and has reduced the balance of the credit available to the Debtors by the amount of such charges. As of the date hereof, Davis Graham has a remaining credit balance in favor of the Debtors for future professional services to be performed, and expenses to be incurred, in the approximate amount of $300,000.00. An accounting summary of payments made to Davis Graham and estimated amounts incurred by Davis Graham for the last twelve (12) months is attached hereto as Exhibit “2”.2 As stated, all such payments have been applied to fees and expenses incurred in providing services to the Debtors, and Davis Graham has a credit balance for professional services to be performed and expenses to be incurred in connection with the Chapter 11 Cases. 10. Davis Graham intends to charge the Debtors for services rendered in these Chapter 11 Cases at Davis Graham’s normal hourly rates in effect at the time the services are rendered. Davis Graham’s current customary hourly rates, subject to change from time to time, are $275 to $585 for partners, $195 to $335 for associates and $160 to $250 for paraprofessionals. 11. No promises have been received by Davis Graham, or any partner or associate thereof, as to payment or compensation in connection with the Chapter 11 Cases other than in accordance with the provision of the Bankruptcy Code, the Bankruptcy Rules, the Local 2. Davis Graham continues to review the pre-petition billing to the Debtors and will amend this Declaration if necessary. 4 Rules of Bankruptcy Practice and Procedure of the United States Bankruptcy Court for the District of Delaware (the "Local Rules"), the guidelines established by the United States Trustee (the "Guidelines") and the retainer letter between the Debtors and Davis Graham. Davis Graham has no agreement with any other entity to share with such entity any compensation received by Davis Graham or by such entity. 12. The Debtors' Application requests, pursuant to section 328(a) of the Bankruptcy Code, approval of its retention of Davis Graham on rates, terms, and conditions consistent with what Davis Graham charges non-chapter 11 debtors, namely, prompt payment of Davis Graham's hourly rates as adjusted from time to time and reimbursement of out-of-pocket disbursements at cost or based on formulas that approximate the actual cost where the actual cost is not easily ascertainable. Subject to these terms and conditions, Davis Graham intends to apply pursuant to Section 330 of the Bankruptcy Code for allowances of compensation for professional services rendered in these Chapter 11 Cases and for reimbursement of actual and necessary expenses incurred in connection therewith in accordance with the provisions of the Bankruptcy Code, the Bankruptcy Rules, the Local Rules, and the Guidelines. 13. The foregoing constitutes the statement of Davis Graham pursuant to sections 327(e), 328(a), 329 and 504 ofthe Bankruptcy Code and Bankruptcy Rules 2014(a) and 2016(b). I declare under penalty of perjury that he foregoing is true and correct. Dated: December 23, 2011 Denver, Colorado Ronald R. Levine, II, Esq. Davis Graham & Stubbs LLP 5 EXHIBIT 1 Retention Checklist PARTIES IN INTEREST LIST 1(a) Current and Recent Former Entities Affiliated with the Debtors Amber Resources Piper Petroleum Castle Exploration Company, Inc.