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In re Garlock Sealing Technologies LLC

United States District Court, W.D. North Carolina, Charlotte Division

June 12, 2017

IN RE GARLOCK SEALING TECHNOLOGIES LLC, et al., Debtors.[1]

         ORDER (A) CONFIRMING THE MODIFIED JOINT PLAN OF REORGANIZATION OF GARLOCK SEALING TECHNOLOGIES LLC, ET AL. AND OLDCO, LLC, SUCCESSOR BY MERGER TO COLTEC INDUSTRIES INC, (B) ADOPTING THE BANKRUPTCY COURT'S PROPOSED FINDINGS OF FACT AND CONCLUSIONS OF LAW, AND (C) ISSUING ASBESTOS CHANNELEVG INJUNCTION

         WHEREAS the above-captioned Debtors (collectively, the "Debtors"), together with the Official Committee of Asbestos Personal Injury Claimants (the "Committee"), the Future Asbestos Claimants' Representative, the Ad Hoc Coltec Future Asbestos Claimants' Representative, and the Ad Hoc Coltec Asbestos Claimants Committee (together with the Debtors, the "Plan Proponents") proposed the Modified Joint Plan of Reorganization of Garlock Sealing Technologies LLC, et al. and OldCo, LLC, Proposed Successor By Merger to Coltec Industries Inc (as it may be further modified hereafter in accordance with its terms, this Confirmation Order, and the Bankruptcy Code, and as modified up to and including the modifications on June 9, 2017, the "Plan");[2]

         WHEREAS on July 29, 2016, the Bankruptcy Court entered the Order Approving Disclosure Statement and Establishing Confirmation Procedures (Docket No. 5445) (the "Solicitation Procedures Order"), by which the Bankruptcy Court, among other things, (1) established procedures for the solicitation and tabulation of votes to accept or reject the Plan; (2) approved the Disclosure Statement as to GST, Garrison, and Anchor; and (3) scheduled a hearing to consider confirmation of the Plan to commence on May 15, 2017 (the "Confirmation Hearing");

         WHEREAS fifteen affidavits of service were filed by Rust Consulting/Omni Bankruptcy (the "Balloting Agent") (Docket Nos. 5486, 5516, 5517, 5518, 5524, 5526, 5546, 5561, 5562, 5563, 5578, 5579, 5602, 5603, and 5623) respecting service of Solicitation Packages as provided by the Solicitation Procedures Order;

         WHEREAS an affidavit from the President of Kinsella Media was filed by the Debtors with the Bankruptcy Court on May 8, 2017 regarding, inter alia, successful completion of the notice program approved in the Solicitation Procedures Order (Docket No. 5919);

         WHEREAS the Balloting Agent filed the Declaration of Catherine Nownes-Whitaker of Rust Consulting/Omni Bankruptcy Regarding Certification of Ballots Cast With Respect to Modified Joint Plan of Reorganization of Garlock Sealing Technologies LLC, et al. and OldCo, LLC, Proposed Successor By Merger to Coltec Industries Inc (Docket No. 5627) (the "Ballot Certification");

         WHEREAS, as indicated in the Ballot Certification, every impaired class of claims and interests entitled to vote on the Plan voted to accept the Plan;

         WHEREAS, as indicated in the Ballot Certification, Class 5 (Asbestos Claims) accepted the Plan by 95.85% in number and 95.80% in dollar amount, and Class 9 (GST/Garrison Equity Interests) accepted the Plan by 100% in number and 100% in dollar amount;

         WHEREAS on December 2, 2016, Debtors filed the Notice of Filing of First Amendment to Modified Joint Plan of Reorganization of Garlock Sealing Technologies LLC, et al., and OldCo, LLC, Proposed Successor by Merger to Coltec Industries Inc, Dated May 20, 2016 (As Modified on June 21, 2016 and July 29, 2016) (Docket No. 5594);

         WHEREAS the objection deadline for objecting to the confirmation of the Plan in the GST, Garrison, and Anchor cases was set for December 9, 2016, and objections to the Plan were filed by the Office of the United States Bankruptcy Administrator for the Western District of North Carolina (the "Bankruptcy Administrator") (Docket No. 5608); Employers Mutual Casualty Company ("Employers Mutual") (Docket No. 5612); Century Indemnity Company ("Century") (Docket No. 5616); and Travelers Casualty and Surety Company and the Travelers Indemnity Company (collectively, "Travelers") (Docket No. 5617);

         WHEREAS the Coltec Restructuring contemplated by the' Plan was completed on December 31, 2016;

         WHEREAS OldCo, LLC, successor by merger to Coltec Industries Inc as a result of the Coltec Restructuring, filed its petition on January 30, 2017;[3]

         WHEREAS the deadline for objecting to confirmation of the Plan in the Coltec case was set for March 24, 2017, and objections to the Plan were filed by Century (Docket No. 5770), Travelers (Docket No. 5769 and 5771), and Quincy Compressor LLC and Atlas Copco (China) Investment Company Ltd. ("Atlas Copco") (Docket No. 5767);

         WHEREAS the Debtors filed a brief in support of confirmation of the Plan (Docket No. 5839) (the "Confirmation Hearing Brief);

         WHEREAS on May 8, 2017, the Committee filed its Pre-Hearing Memorandum on the "Best Interests" Test for Confirmation of the Modified Joint Plan of Reorganization (Docket No. 5915) (the "Committee Pre-Hearing Memorandum");

         WHEREAS Debtors filed further amendments to the Plan on April 3, 2017 and May 14, 2017 (Docket Nos. 5795 and 5951 respectively);

         WHEREAS on May 19, 2017, Debtors filed the Notice of Filing of Supplement to Modified Joint Plan of Reorganization of Garlock Sealing Technologies LLC, et al., and OldCo, LLC, Proposed Successor by Merger to Coltec Industries Inc, Dated May 20, 2016 (As Modified on June 21, 2016, July 29, 2016, December 2, 2016, April 3, 2017, May 14, 2017, and May 19, 2017) (Docket No. 5965);

         WHEREAS on June 8, 2017, Debtors filed the Notice of Filing of Supplement to Modified Joint Plan of Reorganization of Garlock Sealing Technologies LLC, et al., and OldCo, LLC, Successor by Merger to Coltec Industries Inc, dated May 20, 2016 (as modified on June 21, 2016, July 29, 2016, December 2, 2016, April 3, 2017, May 14, 2017, and May 19, 2017 (District Court Docket No. 10);

         WHERAS on June 9, 2017, Debtors filed the Notice of Filing of Supplement to Modified Joint Plan of Reorganization of Garlock Sealing Technologies LLC, et al., and OldCo, LLC, Successor by Merger to Coltec Industries Inc, dated May 20, 2016 (as modified on June 21, 2016, July 29, 2016, December 2, 2016, April 3, 2017, May 14, 2017, May 19, 2017, June 8, 2017, and June 9, 2017) (District Court Docket No. 13);

         WHEREAS the following declarations were submitted in support of the Plan (the "Declarations"): Declaration of Richard L. Magee in Support of Confirmation of the Modified Joint Plan of Reorganization (Docket No. 5910); Declaration of J. Milton Childress in Support of Confirmation of the Modified Joint Plan of Reorganization (Docket No. 5911); Declaration of Timothy J. Dragelin in Support of Joint Plan of Reorganization (Docket No. 5912); Declaration of Charles E. Bates, Ph.D. (Docket No. 5913); Declaration of Joseph W. Grier, III (Docket No. 5914); Declaration of Elihu Inselbuch (Docket No. 5916); Amended Affidavit of Shannon R. Wheatman, Ph.D Regarding Implementation of Plan Notification Program (Docket No. 5374) Affidavit of Shannon R. Wheatman, Ph.D Regarding Implementation of Plan Notification Program (Docket No. 5919); Declaration of Dr. Jorge Gallardo-Garcia in Support of Confirmation of the Modified Joint Plan of Reorganization (Docket No. 5920); Declaration of Satyra L. Riggins in Support of Confirmation of the Modified Joint Plan of Reorganization (Docket No. 5921); Declaration of Elizabeth Barry in Support of Confirmation of the Modified Joint Plan of Reorganization (Docket No. 5922); Declaration of Catherine Nownes-Whitaker in Support of Confirmation of the Modified Joint Plan of Reorganization (Docket No. 5923); Declaration of Mark A. Peterson, Ph.D. (as corrected, Docket No. 5926-1); and Declaration of Bradley M. Rapp (as corrected, Docket No. 5927-1);

         WHEREAS on May 15, 2017, the Bankruptcy Court heard the Plan Proponents' request to confirm the Plan and enter the Asbestos Channeling Injunction, and determined to recommend these Findings of Fact and Conclusions of Law to this Court;

         WHEREAS this Court has received and considered de novo the testimony and other evidence presented by the Plan Proponents at the Confirmation Hearing;

         WHEREAS the Court has reviewed the Plan, the Disclosure Statement, the Solicitation Procedures Order, the Ballot Certification, the Affidavits of Service, the Publication Affidavit, . the objections, the responses thereto, the statements of counsel, briefs, the Declarations, the Confirmation Hearing Brief, and all other testimony and evidence admitted as part of the Confirmation Hearing; and

         WHEREAS the Findings of Fact and Conclusions of Law herein establish just cause for the relief granted herein;

         NOW, THEREFORE, based on this Court's review of the Plan, the Disclosure Statement, the Solicitation Procedures Order, the Ballot Certification, the Affidavits of Service, the Publication Affidavit, the objections, the responses thereto, ih.s statements of counsel, briefs, the Declarations, the Confirmation Hearing Brief, the Committee Pre-Hearing Memorandum, and all other testimony and evidence admitted as part of the Confirmation Hearing, and upon the record of these Chapter 11 Cases; and after due deliberation thereon; and good and sufficient cause appearing therefor, it is hereby found and determined that:

         FINDINGS OF FACT AND CONCLUSIONS OF LAW

         The findings and conclusions set forth herein constitute this Court's findings of fact and conclusions of law in accordance with Fed.R.Bankr.P. 7052, made applicable to this matter pursuant to Fed.R.Bankr.P. 3015(f) and 9014(c). To the extent any of the following findings of fact constitute conclusions of law, they are adopted as such. To the extent any of the following conclusions of law constitute findings of fact, they are adopted as such.

         I. Jurisdiction, Venue, and Core Proceeding

         1. This Court has jurisdiction over the Debtors' Chapter 11 Cases in accordance with 28 U.S.C. §§ 157(d), 1334(a) and 1334(b). Venue of these Chapter 11 Cases is proper under 28 U.S.C. §§ 1408 and 1409. Each of the Debtors was and is qualified under § 109 of the Bankruptcy Code to be a debtor in a Chapter 11 case and are proper co-proponents of the Plan under § 1121(a) of the Bankruptcy Code.

         II. Judicial Notice

         2. This Court takes judicial notice of the dockets of these Chapter 11 Cases and all related adversary proceedings maintained by the Clerk of the Bankruptcy Court, the Clerk of the District Court, or their respective duly appointed agents, including without limitation, all pleadings and other documents filed, all orders entered, all hearing transcripts, and all evidence and arguments made at the hearings held before the Bankruptcy Court or the District Court during the pendency of these Chapter 11 Cases, including the Confirmation Hearing.

         III. The Debtors and Asbestos Litigation Against the Debtors

         A. General Overview of the Debtors

         3. GST, a North Carolina limited liability company, and Garrison, a North Carolina corporation, were wholly owned subsidiaries of Coltec Industries Inc at the time GST and Garrison filed their Chapter 11 petitions. Coltec Industries Inc, in turn, was wholly owned by EnPro Industries, Inc. ("EnPro"). Following consummation of the Coltec Restructuring described in more detail below (see ¶¶ 32-34 below), GST is now a wholly owned subsidiary of EnPro Holdings, Inc. and Garrison is a wholly owned subsidiary of OldCo, LLC, the successor by merger to Coltec Industries Inc. Magee Dec. ¶¶ 9-10, 12.

         4. GST's business was founded in 1887 in Palmyra, New York. GST produces and sells high performance fluid-sealing products, including gaskets and compression packing used in internal piping and valve assemblies in numerous industries. Magee Dec. ¶ 13.

         5. Garrison was formed in 1996 to manage the defense and resolution of asbestos claims against GST, Anchor and Coltec. From its inception to the Petition Date, Garrison (a) supervised a nationwide network of law firms defending asbestos claims against GST and Coltec; (b) managed the defense and resolution of asbestos claims against GST and Coltec; (c) paid judgments, settlements, and defense costs; and (d) collected insurance that covered losses associated with asbestos claims against GST. In addition to managing litigation and resolution of asbestos claims against GST, Garrison was paid fees and reimbursed expenses for managing the defense and resolution of asbestos claims against Anchor and Coltec. Magee Dec. ¶¶ 15-16.

         6. Anchor is a wholly-owned, non-operating subsidiary of Garrison. GST acquired Anchor as a wholly owned subsidiary in June 1987. For many years before GST acquired Anchor and for several years thereafter, Anchor distributed fluid sealing materials, including gaskets and packing. In 1994, Anchor ceased business operations and in 1996 GST transferred its equity interest in Anchor to Garrison. Anchor has no assets or insurance and has not paid to defend or settle an asbestos claim since 2005. Magee Dec. ¶¶ 14, 35.

         7. Some of the products produced and/or sold by GST (prior to 2001) and Anchor (prior to 1988) contained asbestos. Since the 1970s, GST and Anchor have received hundreds of thousands of claims by individuals alleging personal injuries or wrongful death related to exposure to asbestos from such products. Prior to the Petition Date, GST paid approximately $1.37 billion in indemnity payments and hundreds of millions in defense costs to resolve these claims. Magee Dec. ¶ 26; Inselbuch Dec. ¶ 12 & Ex. 1.

         8. OldCo, LLC is successor by merger to Coltec Industries Inc. Some of the businesses operated by Coltec and its predecessors, apart from GST, manufactured or distributed products that contained asbestos, principally equipment with asbestos-containing components, such as gaskets and packing, made by other companies. Such equipment often, though not exclusively, used components manufactured by GST. As a result, since approximately 1992, these Coltec businesses have received tens of thousands of claims by individuals alleging personal injuries or wrongful death caused by exposure to asbestos. The businesses operated by Coltec and its predecessors that received such claims include Fairbanks Morse Engine, Fairbanks Morse Pump, Quincy Compressor, Central Moloney, France Compressor, Delavan, and Farnam. Magee Dec. ¶¶ 36-39.

         9. Claimants who sued Coltec businesses generally also sued GST. Although Coltec paid approximately $7.9 million to defend claims against Coltec, Coltec never paid any money to settle an asbestos personal injury claim. Claimants routinely agreed to dismiss Coltec asbestos claims without payment when they reached settlements with GST with respect to their GST asbestos claims. Magee Dec. ¶¶ 51-53.

         10. As a result of the burden of current and future asbestos claims, GST, Garrison, and Anchor filed their petitions on June 5, 2010, in order to seek a full and final resolution of asbestos claims against them. As described further below, Coltec filed its petition on January 30, 2017, for the same purpose and pursuant to the Comprehensive Settlement described below. Magee Dec. ¶¶ 9, 11, 55-56.

         B. GST's Asbestos Litigation History

         11. For decades prior to the Petition Date, GST received thousands of claims each year from individuals who alleged they suffered from asbestos-related disease caused in part by GST's products. GST was also subject to claims from co-defendants and others seeking to recover from GST with respect to asbestos claims on theories of contribution, indemnity, or other similar theories. Since 1975, plaintiffs have named GST (and/or Anchor) in approximately 900, 000 asbestos cases. GST has disputed its liability for all of these asbestos claims and has never admitted liability for any claim. Magee Dec. ¶¶ 26-27.

         12. Throughout its history, GST has resolved the vast majority of asbestos claims filed against it by dismissal or settlement rather than by verdict. Out of the 900, 000 cases, only approximately 250 cases have resulted in verdicts, the majority of those in GST's favor. Magee Dec. ¶ 29.

         13. GST's asbestos litigation has principally involved two asbestos-containing sealing products: compressed asbestos sheet gaskets and asbestos packing. Magee Dec. ¶ 30.

         14. In addition to its own products, GST also acquired four companies that sold sealing products substantially equivalent to products made and sold by GST, all of which were eventually merged into GST-Belmont Rubber & Packing Co. ("Belmont"), Crandall Packing Company, Dealers' Steam Packing Company, and U.S. Gasket Company. Garrison received approximately 8, 500 complaints naming Belmont, despite its merger into GST in 1968. Nearly all of these complaints were filed before 2004, and all but 62 also named GST. None of me Belmont claims were resolved by payment, but were resolved only by dismissal or in connection with payments on claims against GST itself. Magee Dec. ¶¶ 31-32.

         15. As of the Petition Date, there were approximately 95, 000 asbestos claims pending against GST in state and federal courts across the country. Approximately 82, 000 of these claims alleged non-malignant conditions or did not indicate an alleged disease or condition. Approximately 13, 000 claims alleged mesothelioma, lung cancer, or other cancer. Magee Dec. ¶ 33.

         C. Corporate History of Coltec

         16. Coltec was a longstanding, diversified manufacturer that was variously known in prior years as Penn-Texas Corporation (until 1959), Fairbanks Whitney Corporation (until 1964), and Colt Industries Inc (until 1990). Colt Industries Inc then changed its name to Coltec Industries Inc on May 3, 1990. Coltec merged with Runway Acquisition Corporation, a subsidiary of Goodrich Corporation ("Goodrich") on July 12, 1999 and survived as a wholly owned subsidiary of Goodrich. Magee Dec. ¶¶ 17-19.

         17. EnPro was incorporated on January 11, 2002 as a wholly owned subsidiary of Goodrich and is the sole parent entity of Coltec. On May 31, 2002, the shares of EnPro were distributed to the shareholders of Goodrich, and EnPro became a separate public company, with Coltec continuing as its direct, wholly-owned subsidiary. Magee Dec. ¶ 20.

         18. Through its divisions and a number of direct and indirect foreign and domestic subsidiaries, Coltec historically operated a broad and diverse range of engineered industrial products manufacturers. Magee Dec. ¶ 17.

         D. Coltec's Asbestos Litigation History

         19. Claimants first began suing Coltec no later than 1992. Plaintiffs named either Coltec or businesses for whose conduct Coltec or one of its predecessors was alleged to be responsible, including "Fairbanks Morse, " "Fairbanks Morse Engine, " "Fairbanks Morse Pump, " "Quincy Compressor, " "Central Moloney, " "France Compressor, " "Delavan, " and "Farnam." Magee Dec. ¶¶ 37, 39.

         20. Fairbanks Morse

         Plaintiffs named "Fairbanks Morse" or "Fairbanks Morse Engine" ("FME") in complaints, alleging exposure to asbestos from components, principally gaskets, in engines and locomotives. Many of these gaskets were likely manufactured by GST, although not all of them were. The Fairbanks Morse business was founded in the nineteenth century. From the 1930s, the business manufactured engines at its Beloit, Wisconsin plant. During World War II, FME engines were used in submarines for the U.S. Navy, as well as in destroyers and landing ships. FME engines were also used in power plants and locomotives. Coltec's predecessor acquired control over Fairbanks Morse & Co. in 1958, and Coltec owned it as a subsidiary until 1986, when the successor to Fairbanks Morse merged with Coltec (then known as Colt Industries Inc). Magee Dec, ¶¶ 40-41.

         21. Fairbanks Morse Pump.

         Plaintiffs named "Fairbanks Morse Pump" ("FMP") alleging exposure to asbestos from components in pumps, principally gaskets and packing. Many of the gaskets and packing were likely manufactured by GST, although not all of them were. The Fairbanks Morse business described above also had a pump division, which manufactured water-based pump systems in Kansas City, Kansas. Magee Dec. ¶ 42.

         22. The FMP business was in a Coltec subsidiary in 1985 when that subsidiary sold the assets of the FMP division to FMPD Purchasing Corporation (renamed Fairbanks Morse Pump Corporation ("FMPC")). FMPC assumed FMP's product liabilities (including any liabilities resulting from the pre-closing sale of asbestos-containing pump products), and Debtors and FMPC allege that FMPC obtained rights against Coltec's insurance. Magee Dec. ¶ 43.

         23. FMPC was acquired by General Signal Corporation in 1995, which sold the FMP assets to Pentair Inc. in 1997. SPX Corporation acquired General Signal in 1998 and merged with General Signal in 2003. FMPC remains a dormant subsidiary of a successor to SPX Corporation, retaining any liabilities for FMP asbestos claims. Debtors and FMPC allege FMPC retained corresponding rights against Coltec insurance. Magee Dec. ¶ 43.

         24. Prior to these Chapter 11 Cases, Garrison continued to receive and defend the FMP asbestos claims. In doing so, Garrison obtained dismissals of FMP claims without payment, often as part of a settlement of GST Asbestos Claims. Magee Dec. ¶ 44.

         25. Quincy Compressor.

         Plaintiffs named "Quincy Compressor" ("Quincy"), alleging exposure to asbestos from components in compressors, principally gaskets. Many of those gaskets were likely manufactured by GST, although not all of them were. Coltec's predecessor acquired Quincy Inc in 1966, and the successor of mat subsidiary eventually merged into Coltec, with Quincy thereafter operated as a division of Coltec. In December 2009, Coltec sold the assets of the Quincy division to Fulcrum Acquisition LLC, retaining any liability for asbestos claims. No indemnity was ever paid for a Quincy asbestos claim. Magee Dec. ¶ 45.

         26. Central Moloney.

         According to Garrison's database, plaintiffs named "Central Moloney" as a defendant in three cases. Garrison believes the suits alleged that transformers Central Moloney manufactured contained asbestos gaskets. At certain points in time, Coltec or its predecessors operated a division named "Central Moloney Transformer" or owned a subsidiary named "Central Transformer Corporation, " "Central Transformer Inc, " or "Central Moloney Inc." Magee Dec. ¶¶ 48, 50.

         27. France Compressor.

         Plaintiffs have named "France Compressor" as a defendant, alleging exposure to asbestos from components in compressors. Divisions named "France Products" and "France Compressor Products" were at various times operated by GST, and then after 1995 as a subsidiary of Coltec. The various entities or businesses known as "France Compressor" made parts for compressors, not compressors, and are not believed to have marketed or manufactured any asbestos-containing products. Magee Dec. ¶ 49.

         28. Delavan.

         According to Garrison's database, plaintiffs named "Delavan" (or sometimes "Delevan" or "Delavan Instruments") collectively 3, 711 times, all between 1999 and 2002. The allegations in these lawsuits appear to have involved equipment that allegedly had asbestos-containing components. At certain points in time, Coltec or its predecessors operated divisions named "Delavan Gas Turbine Products, " "Delavan Spray, " "Delavan-Carroll, " "Delavan Steel Treating" and "Delavan Power Generation" and owned subsidiaries named "Delavan Inc, " "Delavan-Carroll Inc., " "Delavan-Delta, Inc., " and "Delavan Spray, LLC." Magee Dec. 46.

         29. Farnam.

         According to Garrison's database, plaintiffs have named "Farnam" as a defendant 209 times, all in 1994, 2003, and 2004. Garrison believes the claims alleged Farnam was a regional distributor of asbestos-containing products, including gaskets, or manufactured asbestos-containing gaskets. At certain points in time, Coltec or its predecessors operated a division named "Farnam Sealing Systems" or owned a subsidiary named "F. D. Farnam Co., " "F.D. Farnam Inc, " or "Farnam Sealing Systems Inc." Magee Dec. ¶ 47.

         30. Coltec or EnPro.

         Finally, plaintiffs from time to time named Coltec or EnPro in complaints directly, usually without any particular product allegations. EnPro itself has never manufactured or sold any asbestos-containing products, and was sued derivatively based on claims against Coltec, GST, or Garrison. No indemnity was ever paid for an asbestos claim against Coltec or EnPro, and the claims were resolved only by dismissal or in connection with payments on GST Asbestos Claims. Magee Dec. ¶¶ 50-53.

         31. No indemnity was ever paid for any claim against Coltec or any of the businesses for whose conduct Coltec or one of its predecessors was alleged to be responsible, or against EnPro or any EnPro affiliate-except GST, Garrison, and Anchor. Claims against Coltec, EnPro, or any of the businesses for whose conduct Coltec or one of its predecessors was alleged to be responsible, were resolved only by dismissal or in connection with payments on GST asbestos claims. Magee Dec. ¶¶ 50-53.

         E. Coltec Restructuring

         32. In 2016, Coltec was substantially reorganized, as contemplated by the Comprehensive Settlement by and among the Plan Proponents and EnPro (see ¶¶ 32-34 below). The Coltec Restructuring was carefully negotiated and vetted by the Plan Proponents prior to entering into the Comprehensive Settlement. The Coltec Restructuring was also conditioned on a favorable vote by Asbestos Claimants, and was consummated after the Balloting Agent certified that Asbestos Claimants had accepted the Plan. Magee Dec. ¶ 25.

         33. The Coltec Restructuring involved: (i) a contribution of the Fairbanks Morse business to a new, wholly-owned subsidiary of Coltec Industries Inc and, subsequently, (ii) the merger of Coltec Industries Inc with and into OldCo, LLC, a new wholly-owned indirect subsidiary of EnPro, and (iii) a distribution of certain assets and liabilities of the former Coltec Industries Inc (including all of the ownership interests in the former subsidiaries of Coltec as acquired in the merger, excluding the Learning System assets and operations and the Garrison Equity Interests) to EnPro Holdings, Inc., a new and wholly-owned direct subsidiary of EnPro. OldCo, LLC (as successor to Coltec) then filed a Chapter 11 petition to implement the Comprehensive Settlement, together with GST and Garrison, through the Plan. (Case No. 17-BK-30140, Docket No. 1).

         34. As a result of the Coltec Restructuring, GST is a wholly owned subsidiary of EnPro Holdings, Inc., and Garrison is a wholly owned subsidiary of OldCo, LLC.

         IV. The Chapter 11 Cases

         A. The Debtors' Decision to Seek Relief Under Chapter 11

         35. GST, Garrison and Anchor (referred to collectively as the "Garlock Debtors") commenced their respective Chapter 11 Cases by filing petitions for relief under Chapter 11 on June 5, 2010 (Docket No. 1). The Garlock Debtors filed their cases in order to fully and finally resolve their asbestos liabilities in bankruptcy, and preserve their businesses for the benefit of Holders of Claims and Interests. Magee Dec. ¶ 56.

         36. After filing their petitions, the Garlock Debtors filed an adversary proceeding complaint, Garlock Sealing Technologies LLC, et ah v. Those Parties Listed on Exhibit B to Complaint and Unknown Asbestos Claimants (Adversary Proceeding No. 10-03145, Bankr. W.D.N.C), and a motion for preliminary injunction seeking an order barring asbestos claimants from pursuing claims against Coltec or any Non-Debtor Affiliate. On June 7, 2010, the Bankruptcy Court issued a temporary restraining order (Docket No. 9) and on June 21, 2010, a preliminary injunction (Docket No. 14) granting the requested relief.

         37. The Official Committee of Unsecured Creditors was formed by order of the Bankruptcy Court entered June 17, 2010 (Docket No. 104).

         38. The Committee was formed by order of the Bankruptcy Court entered on June 16, 2010 (Docket No. 101), and the makeup of the Committee was modified by order entered on July 20, 2010 (Docket No. 260).[4]

         39. The Bankruptcy Court entered an order appointing Joseph W. Grier, III as the Future Claimants Representative ("FCR") on September 16, 2010 (Docket No. 512). That Order set forth the scope of the FCR's authority and obligation to act on behalf of future claimants in these Chapter 11 Cases.

         B. Estimation of Current and Future Mesothelioma Claims and Other Litigation

         40. On December 9, 2010, the Bankruptcy Court entered an order (Docket No. 853) (the "December 9 Order") establishing a six-month period for "conducting preliminary discovery related to estimation, for purposes of formulating a plan of reorganization, of the Debtors' liability for pending and future asbestos-related claims for personal injury and wrongful death." The December 9 Order also permitted the Committee and FCR to conduct a six-month period of discovery regarding pre-petition related party transfers and a . 2005 corporate restructuring that produced the Coltec Note and the Stemco Note.

         41. On December 2, 2011, the Garlock Debtors moved the Bankruptcy Court to estimate the aggregate number and amount of allowed current and future mesothelioma claims against GST and Garrison pursuant to Section 502(c) of the Bankruptcy Code (Docket No. 1683) (the "Estimation Motion").

         42. On April 13, 2012, the Bankruptcy Court entered the Order for Estimation of Mesothelioma Claims (Docket No. 2102) (the "Estimation Order") granting the Estimation Motion and setting the scope and purpose of the estimation proceeding. The Bankruptcy Court concluded that it would hold a trial to estimate allowed mesothelioma claims pursuant to Section 502(c) of the Bankruptcy Code for the purpose of determining the feasibility of any Chapter 11 plan of reorganization that might be proposed in the Chapter 11 Cases. The Bankruptcy Court initially scheduled the estimation trial to commence on December 3, 2012 but eventually continued the trial to July 22, 2013.

         43. In the Estimation Order, the Bankruptcy Court ruled that it would consider properly supported evidence based upon both the "settlement approach, " which the Committee and FCR proposed to employ for the estimation of mesothelioma claims, and the "legal liability approach, " which Debtors proposed to employ.

         44. . For more than two years before the estimation trial, the Garlock Debtors, Coltec, the Committee, and the FCR engaged in contentious, time-consuming, and expensive litigation regarding the proper scope of discovery and evidence supporting their respective theories of estimation.

         45. From July 22 to August 22, 2013, over seventeen trial days, the Bankruptcy Court conducted an evidentiary hearing pursuant to the Estimation Order to determine a reliable aggregate estimate of GST's present and future mesothelioma claims. The Garlock Debtors' experts projected Garlock's aggregate mesothelioma liability at not more than $125 million, and the Committee and FCR offered opinions from each of their experts estimating that GST's aggregate liability for mesothelioma claims exceeded $1 billion.

         46. That trial culminated in entry on January 10, 2014 of the Estimation Opinion, in which the Bankruptcy Court estimated GST's aggregate liability for present and future mesothelioma claims at no more than $125 million. See In re Garlock Sealing Technologies LLC, 504 B.R. 71, 97 (Bankr. W.D. N.C. 2014).

         47. Because of the great magnitude of mesothelioma claims in comparison to claims based on other allegedly asbestos-related diseases, the parties agreed and the Bankruptcy Court ordered that the estimation proceeding would not include any estimated liability for non- mesothelioma claims. Id. at 75. The Bankruptcy Court also excluded asbestos-related claims against Anchor from its estimate.

         48. The Committee took the position that the Estimation Opinion was interlocutory, and stated its intention to appeal from that decision once it became a final order or otherwise ripe for appellate review. The Debtors maintain that the Estimation Opinion is correct and is the law of the case.

         49. On June 4, 2014, the Committee moved the Bankruptcy Court to reopen the record of the estimation proceeding to permit the Committee to present supplemental evidence after taking additional discovery from the Garlock Debtors and then to seek modification of the Estimation Opinion based on such additional evidence. (Docket Nos. 3725 and 3726). The Garlock Debtors and Coltec objected. (Docket Nos. 3725 and 3726). On December 4, 2014, the Bankruptcy Court denied the Committee's motion. (Docket. Nos. 4260 and 4274; 12/4/2014 transcript).

         50. Prior to issuance of the Estimation Opinion, GST and Garrison filed lawsuits against several law firms that represented personal injury claimants to whom GST and Garrison paid money prior to the Petition Date as a result of settlements that GST and Garrison contend were fraudulently obtained (the "Adversary Proceedings"): (i) Garlock Sealing Technologies LLC, et al. v. Chandler, et al., Case No. 12-03137 (Bankr. W.D.N.C); (ii) Garlock Sealing Technologies LLC, et al. v. Shein Law Center Ltd, et al., Case No. 3:14-cv-00137 (W.D.N.C); (iii) Garlock Sealing Technologies LLC, et al. v. Belluck & Fox, LLP, et al, Case No. 3:14-cv-00118 (W.D.N.C); (iv) Garlock Sealing Technologies LLC, et al. v. Simon Greenstone Panatier Bartlett, A Professional Corporation, et al, Case No. 3:14-cv-00116 (W.D.N.C); and (v) Garlock Sealing Technologies LLC, et al. v. Estate of Ronald C. Eddins, et at, Case No. 3:14-cv-00130 (W.D. N.C. ).

         51. Pursuant to the December 9 Order authorizing discovery from the Garlock Debtors, Coltec, and other affiliates relating to a 2005 corporate restructuring and other pre-petition insider transactions, the Committee and FCR propounded multiple interrogatories and requests for production of documents on the Garlock Debtors, Coltec, other non-debtor affiliates, and certain third parties. The respondents produced voluminous documents. The discovery obtained eventually resulted in decisions by the Committee and the FCR to file their Joint Motion for Leave, Proposed Complaint, and Motion for Modification (collectively, "ACC/FCR Motions") (Docket No. 2150; Adv. Proc. No. 10-03145, Docket No. 33) seeking to assert breach of fiduciary duty claims against certain former managers of GST and fraudulent transfer, unjust enrichment, conspiracy to defraud, successor liability, alter ego, and other claims against the defendant entities.

         52. After the filing of the ACC/FCR Motions, the Garlock Debtors filed their Motion for Order (A) Authorizing Debtors to (I) Enter into the Affiliate Tolling Agreement and (II) Enter into the Proposed Managers Tolling Agreement Pursuant to 11 U.S.C. §§ 105(a) and 363 and Bankruptcy Rule 6004 and (B) Authorizing the Debtors to Abandon Non-Affiliate Preference Claims Pursuant to 11 U.S.C. §§ 105(a) and 554(a) and Bankruptcy Rule 6007 (the "Tolling Agreement Motion") (Docket No. 2194). The Bankruptcy Court granted the Tolling Agreement Motion by order entered on June 4, 2012 (Docket No. 2281) and denied without prejudice the ACC/FCR Motions by order entered on June 7, 2012 (Docket No. 2292; Adv. Proc. No. 10-03145, Docket No. 51).

         53. The Garlock Debtors and the defendants named in the Proposed Complaint have continued to toll the alleged causes of action in the Proposed Complaint (the "Tolled Claims") by way of tolling agreements entered into after the Bankruptcy Court granted the Tolling Agreement Motion and a series of orders subsequently entered with the consent of those defendants, the Garlock Debtors, the Committee, and the FCR. The Tolled Claims are to be settled and released under Section 8.4 of the Plan.

         C. The Garlock Debtors' Plans

         54. The Bankruptcy Court entered three orders during the Chapter 11 Cases extending the Garlock Debtors' exclusive periods to file and solicit acceptances of a Chapter 11 plan. By order of the Bankruptcy Court entered on May 20, 2011 (Docket No. 1349), the Bankruptcy Court granted the Garlock Debtors' final extension of (i) the exclusive period to file a reorganization plan (or plans) through November 28, 2011, and (ii) the exclusive period to solicit acceptances of a plan through and including January 26, 2012.

         55. The Garlock Debtors filed a Plan of Reorganization (Docket No. 1664) on November 28, 2011 (the "Initial Plan"), prior to the termination of their exclusive period to file a reorganization plan, but did not solicit acceptances of the Initial Plan. The Garlock Debtors' exclusive periods to file and solicit acceptances to a Chapter 11 plan expired January 26, 2012, but as of the date of this Order no party in interest has filed a plan other than the Plan Proponents.

         56. Along with their Initial Plan, the Debtors filed a disclosure statement (Docket No. 1666) (the "First Disclosure Statement") and the exhibit book related to the Initial Plan (Docket No. 1665). The Garlock Debtors filed a supplemental exhibit book on December 16, 2011 (Docket No. 1722). The Committee and FCR each filed objections to approval of the First Disclosure Statement (Docket Nos. 1806 and 1808), to which the Debtors responded (Docket No. 1823). The Bankruptcy Court did not hold a hearing on approval of the First Disclosure Statement.

         57. On May 29, 2014, in response to the Estimation Opinion, the Garlock Debtors filed the Debtors' First Amended Plan of Reorganization (Docket No. 3708), as well as the Disclosure Statement for Debtors' First Amended Plan of Reorganization (Docket No. 3710) (the "Second Disclosure Statement") and the exhibit book related to the Debtors' First Amended Plan of Reorganization (Docket No. 3709). The Committee filed objections to approval of the Second Disclosure Statement (Docket Nos. 3961 and 4107), to which the Debtors responded (Docket No. 4094). The Bankruptcy Court did not hold a hearing on approval of the Second Disclosure Statement.

         D. The Second Amended Plan Filed by the Garlock Debtors and the FCR

         58. On January 9, 2015, the Garlock Debtors and the FCR reached an agreement in principle on a plan that the FCR would support, resolving all GST Asbestos Claims. On January 13, 2015, the Garlock Debtors and the FCR filed the Second Amended Plan, which incorporated the agreement with the FCR. (Docket No. 4306). Magee Dec. ¶ 64; Grier Dec. ¶ 23.

         59. Although the Second Amended Plan retained the fundamental structure of the First Amended Plan, the Garlock Debtors agreed to provide increased funding for GST Asbestos Claimants, and also agreed to various changes to the CRP. Magee Dec. ¶ 64; Grier Dec. ¶ 23.

         60. Neither the Initial Plan, nor the First Amended Plan, nor the Second Amended Plan sought to resolve and treat Coltec Asbestos Claims in their entirety as a class. Magee Dec. ¶ 65; Grier Dec. ¶ 23.

         61. Confirmation proceedings on the now-superseded Second Amended Plan commenced and progressed through preliminary stages. On January 26, 2015, on motions made or supported by the Garlock Debtors and the FCR, and over the objections or limited objections of the Committee, the Bankruptcy Court entered a bar date order, establishing October 6, 2015 as the deadline (the "Asbestos Claims Bar Date") for filing proofs of claim for GST Asbestos Claims based on an asbestos-related disease diagnosed on or before August 1, 2014,, for which lawsuits against any defendant or claims against any trust were filed on or before August 1, 2014. See Order Approving Disclosure Statement and Establishing Asbestos Claims Bar Date and Procedures For Solicitation, dated April 10, 2015 (Docket No. 5134). Proofs of claim for GST Asbestos Claims arising after August 1, 2014, were permitted but not required to be filed. The Bankruptcy Court also established certain solicitation and confirmation procedures, and approved a disclosure statement for the Second Amended Plan. (Docket No.4542).

         62. The voting deadline on the Second Amended Plan was October 6, 2015. On December 4, 2015, the Balloting Agent reported that the holders of current GST Asbestos Claims in Class 4 had rejected the Second Amended Plan by a large margin. (Docket No. 5119). As of the Asbestos Claims Bar Date, also on October 6, 2015, 170, 260 proofs of claim for current GST Asbestos Claims had been filed (with ballots cast on the Second Amended Plan being regarded as proofs of claim).

         63. The Garlock Debtors announced that they would ask the Bankruptcy Court to confirm the Second Amended Plan, despite Class 4's rejection of it, in accordance with the "cramdown" provisions of the Bankruptcy Code. On October 6, 2015 and December 18, 2015, the Committee filed objections to the Second Amended Plan, contending that the plan was unconfirmable on various grounds, as did certain persons who described themselves as being at risk of malignancies and therefore as potential future GST Asbestos Claimants. (Docket Nos. 4883, 4885, 5160).

         64. As of January 2016, discovery pertaining to the Second Amended Plan and the objections thereto was underway, and the parties were preparing for a contested confirmation hearing that was scheduled to commence on June 20, 2016. Additionally, the Bankruptcy Court was scheduled to hear argument, commencing on January 6, 2016, on certain cross-motions for summary judgment that the parties had filed and briefed. See Committee's Motion For Summary Judgment Denying Confirmation Based on Plan's Failure to Comply with Bankruptcy Code Section 524(g) (Docket No. 5071) and Motion for Partial Summary Judgment That Class 4 Claims Are Impaired and the FCR Has No Authority to Vote on the Plan (Docket No. 5069); Debtors' and FCR's Motion for Partial Summary Judgment That Section 524(g) Is Not Exclusive and the FCR Has Authority to Vote (Docket No. 5072); Opposition of the Official Committee of Asbestos Personal Injury Claimants to the Debtors and Future Claims Representative's Motion for Partial Summary Judgment (Docket No. 5159); Debtors' and FCR's Opposition to Committee Motion for Summary Judgment on 524(g) and FCR Authority To Vote (Docket No. 5161); Debtors' Opposition to Committee Motion for Partial Summary Judgment That Class 4 Is Impaired (Docket No. 5162).

         E. The Comprehensive Settlement and Joint Plan

         65. On January 5, 2016, the Garlock Debtors, the Committee and the FCR jointly asked the Bankruptcy Court to order a suspension of litigation on confirmation issues related to the Second Amended Plan in order to accommodate negotiations on a fully consensual plan of reorganization.

         66. The Bankruptcy Court continued the hearing on the parties' cross motions for summary judgment from January 6, 2016, to March 1, 2016, and the parties agreed to a 30-day moratorium on discovery in the confirmation proceedings. The Bankruptcy Court also continued the hearing on the proposed confirmation of the Second Amended Plan to August 15, 2016. As negotiations progressed, the parties agreed to extend the moratorium twice and to continue the summary judgment hearings, first until March 10, 2016, and then indefinitely.

         67. In mid-February 2016, the parties reached an understanding that, for purposes of the negotiations, an ad hoc committee should be established for current Coltec Asbestos Claimants and that an ad hoc legal representative for holders of future Coltec Asbestos Claims should also participate. The Ad Hoc Coltec Asbestos Claimants Committee was formed consisting of attorneys from each of the following plaintiffs' law firms: Belluck & Fox; Cooney & Conway; The Jaques Admiralty Law Firm; Simon, Greenstone, Panatier & Bartlett; Thornton & Naumes; and The Lanier Law Firm. Each of these, other than The Lanier Law Firm, already represented and continues to represent an Asbestos Claimant against GST on the Committee. All of the aforementioned law firms, including The Lanier Law Firm, represent Coltec Asbestos Claimants and filed claims on behalf of those individuals before the litigation was stayed in 2010. The Committee and the Ad Hoc Coltec Asbestos Claimants Committee thereafter functioned in unison in the negotiations, based on the overlapping claims histories and essential unity of interests as between GST Asbestos Claimants and Coltec Asbestos Claimants. Magee Dec. ¶ 71; Inselbuch Dec. ¶ 20(a); Grier Dec. ¶ 27.

         68. Also in mid-February 2016, Joseph W. Grier, III, the current FCR in the Garlock Debtors' Chapter 11 Cases, agreed to serve as the ad hoc legal representative for future Coltec Asbestos Claimants. Mr. Grier thereafter participated in the negotiations in both capacities, based on the overlapping claims histories and essential unity of interests as between GST Asbestos Claimants and Coltec Asbestos Claimants. Magee Dec. ¶ 71; Inselbuch Dec. ¶ 20(b); Grier Dec. ¶27.

         69. On March 17, 2016, the Garlock Debtors, Coltec, the Committee, the Ad Hoc Coltec Asbestos Claimants Committee, the FCR, the Ad Hoc Coltec Future Asbestos Claimants' Representative, and EnPro entered into the Comprehensive Settlement by signing the Term Sheet for Permanent Resolution of All Present and Future GST Asbestos Claims and Coltec Asbestos Claims. Disclosure Statement, Ex. 2; Magee Dec. ¶ 78; Inselbuch Dec. ¶ 23; Grier Dec. ¶ 32.

         70. In order to implement the Comprehensive Settlement, on May 20, 2016, the Plan Proponents filed the Joint Plan of Reorganization of Garlock Sealing Technologies LLC, et al. and OldCo, LLC, Proposed Successor by Merger to Coltec Industries Inc (Docket No. 5331) and the Disclosure Statement thereto (Docket No. 5332).

         71. The Plan will result in a permanent resolution of all GST Asbestos Claims and Coltec Asbestos Claims (together, "Asbestos Claims"), other than Foreign Asbestos Claims asserted outside the United States judicial system. The Plan will establish a trust under Section 524(g) of the Bankruptcy Code (as defined in the Plan, the "Asbestos Trust") to assume all liabilities for, and to process and pay, Asbestos Claims pursuant to the Claims Resolution Procedures ("CRP") attached as Exhibit B to the Plan. The Asbestos Trust will be solely responsible for resolving and paying Asbestos Claims and for paying the Asbestos Trust Expenses in accordance with the Asbestos Trust Agreement and CRP.

         72. The Asbestos Trust will be funded with the following assets: (a) $350 million in Cash contributed to the Asbestos Trust by GST or Garrison on the day immediately preceding the Effective Date; (b) $50 million in Cash contributed to the Asbestos Trust by Coltec on the day immediately preceding the Effective Date; (c) the Deferred Contribution; (d) the Option; (e) any insurance recoveries paid to the Asbestos Trust in accordance with Section 7.3.10 of the Plan; (f) the Asbestos Trust Causes of Action (as defined in Section 7.3.4 of the Plan); and (g) following the transfer or vesting of the foregoing to or in the Asbestos Trust, any proceeds thereof and earnings and income thereon.

         73. In exchange for funding the Asbestos Trust, GST, Coltec, Garrison, and the other Asbestos Protected Parties (defined in Section 1.1(21) of the Plan and listed in Exhibit 1 to this Order) will be protected by the Asbestos Channeling Injunction that will prohibit assertion of Asbestos Claims (other than Foreign Asbestos Claims asserted outside the United States judicial system) against those parties in accordance with its terms.

         74. The Plan describes ten classes of Claims and Interests against the Debtors in Article 3. Only two of those classes are impaired: Class 5 (Asbestos Claims) and Class 9 (GST/Garrison Equity Interests). Class 5 Claims will be channeled to the Asbestos Trust and dealt with pursuant to the CRP. Class 9 Claims are to be retained by the Holders, subject to the Lien on those Equity Interests necessary to secure the Deferred Contribution to the Asbestos Trust (as described in the Plan).

         75. All other classes of Claims and Interests are unimpaired by the Plan and thus deemed to have accepted the Plan.

         76. The CRP are designed to (a) generate settlement offers to Asbestos Claimants that are fair, expeditious, and properly reflective of the injuries allegedly caused to injured persons by exposure to asbestos fibers or dust from Coltec Products (as defined in the CRP) or GST Products (as defined in the CRP) and (b) ensure that over the life of the Asbestos Trust present and future Asbestos Claims are treated fairly and equitably in all matters, including the payment of settlement amounts from the Asbestos Trust that are as equal as possible to other payments for similarly situated claimants in the same disease category. Inselbuch Dec. ¶¶ 52-56; Grier Dec. ¶¶ 48-65.

         77. The Asbestos Trust will be administered according to the Asbestos Trust Agreement attached as Exhibit A to the Plan. The Trustee will administer the Asbestos Trust, and will be responsible for fulfilling the duties more particularly described in the Trust Agreement. Inselbuch Dec. ¶¶ 35-36; Grier Dec. ¶¶ 42-44.

         78. The Trustee will be advised by the FCR and a Claimant Advisory Committee ("CAC") consisting initially of the nine members identified on the signature page of the Trust Agreement attached to the Plan, who are attorneys representing Asbestos Claimants. The CAC will be responsible for representing the shared interests of current Asbestos Claimants. The FCR will represent the shared interests of future Asbestos Claimants. See Asbestos Trust Agreement §§ 5.2, 6.1; Inselbuch Dec. ¶¶ 37-38; Grier Dec. ¶¶ 45-47.

         79. In addition, the Asbestos Trust and the Reorganized Debtors will enter into a Cooperation Agreement regarding the Asbestos Trust's taking possession of certain documents and the Reorganized Debtor's obligations to assist the Asbestos Trust in the processing, resolution, and defense of Asbestos Claims. The form of Cooperation Agreement is attached as Exhibit C to the Plan. However, prior to execution, the Trustee will have the opportunity to review and propose changes to the Cooperation Agreement.

         80. Anchor, a North Carolina corporation, has no assets or insurance and has not paid to defend or settle an asbestos claim since 2005. The Plan provides that, on the Effective Date, Anchor will be dissolved in accordance with North Carolina General Statutes §§ 55-14-01 et seq. (Plan § 7.7). All Holders of Class 8 Anchor Claims will be permitted, after the Effective Date, to assert and pursue claims against Anchor, and such claims will be fully reinstated to the status quo ante as of the Petition Date. (Id.). Claims against Anchor shall not be assumed or paid by the Asbestos Trust. However, all derivative claims against GST, Garrison, and Coltec based on third parties' asbestos liabilities, including such claims based on Anchor's liabilities, will be subject to the Asbestos Channeling Injunction, and GST, Garrison, and Coltec will be discharged of those claims to the fullest extent permitted by law.

         81. Immediately upon the effectiveness of the Asbestos Channeling Injunction on the Effective Date, the Plan provides that Coltec shall merge with and into EnPro Holdings, Inc., with EnPro Holdings, Inc. as the survivor of such merger, pursuant to the Articles of Merger attached as Exhibit K to the Plan. In such merger, the outstanding Capital Stock of Coltec will be cancelled and each outstanding share of Capital Stock of Coltec will be converted into a share of common stock of EnPro Holdings, Inc. EnPro Holdings, Inc. will succeed to Coltec's obligations under the Plan. (Plan § 7.10).

         F. Subsequent Events in the Chapter 11 Cases

         82. In November 2016, GST, Garrison, EnPro, Coltec and Garlock of Canada Ltd. entered into the Canadian Settlement and the Garlock Debtors promptly moved the Bankruptcy Court for an order approving the Canadian Settlement pursuant to Bankruptcy Rule 9019, as contemplated in Section 7.8(jj) of the Plan. The Bankruptcy Court entered an Order Granting Debtors' Motion to Approve Compromise and Settlement of Present and Future Canadian Provincial Board Claims for Asbestos-Related Injury Payments on February 3, 2017 (Docket No. 5676). The Canadian Settlement resolves certain Resolved Claims (as defined in the settlement agreement) that the Canadian Provincial Workers' Compensation Boards contend have been assigned to them based in part on Canadian workers' contact with the products of the Garlock Parties (as defined in the settlement). In exchange for payment of the Settlement Amount by the Garlock Parties, the Provincial Boards agreed that no Resolved Claim may be filed against any Garlock Party, any Asbestos Protected Party, or the Asbestos Trust.

         83. On December 19, 2016, the Balloting Agent filed the Ballot Certification certifying that Classes 5 and 9 had accepted the Plan.

         84. On December 31, 2016, the Coltec Restructuring contemplated by the Plan was completed. Coltec filed its Chapter 11 petition on January 30, 2017 (Case No. 17-BK-30140, Docket No. 1). The Chapter 11 Cases are jointly administered (Docket No. 5677). Hence, as required by the Plan, the Coltec Restructuring has been consummated and OldCo, LLC has commenced its Chapter 11 case (Plan § 7.8(a)).

         85. On February 3, 2017, the Bankruptcy Court entered an order appointing the Ad Hoc Coltec Future Asbestos Claimants' Representative, Joseph W. Grier, III, as the legal representative to represent the interests of, appear on behalf of, and be a fiduciary to the holders of future Coltec Asbestos Claims (Case No. 17-BK-30140, Docket No. 43; see also Plan § 7.8(b)).

         86. That same day, the Bankruptcy Court entered an order appointing to the Committee three Coltec Asbestos Claimants from among the clients of the plaintiff law firms serving on the Ad Hoc Coltec Asbestos Claimants Committee, and further providing that the expanded Committee serve as the Official Committee of Asbestos Personal Injury Claimants in the Coltec Bankruptcy Case (Docket No. 5674; see also Plan § 7.8(c)).

         V. The Plan Satisfies the Requirements for Confirmation

         A. Burden of Proof

         87. The Plan Proponents have the burden of proving the elements of Section 1129(a) by a preponderance of the evidence. In support of confirmation, the Plan Proponents submitted the Declarations as well as certain other exhibits (Docket No. 5959). This Court finds the written testimony in the Declarations and other exhibits offered to be credible and supportive of confirmation of the Plan. As detailed below, the Plan satisfies all applicable sections of the Bankruptcy Code, including Section 524(g) of the Bankruptcy Code (Plan § 7.8(d)).

         B. Impaired Class That Has Voted to Accept the Plan

         88. As set forth in the Plan, Class 5 Asbestos Claims are impaired by the Plan and therefore were entitled to vote. As set forth in the Ballot Certification, claimants in Class 5 voted to accept the Plan in the requisite numbers and amounts required by Sections 524(g), 1126, and 1129 of the Bankruptcy Code (Plan § 7.8(g)).

         C. A dequacy of Notice and Due Process

         89. Adequate and sufficient notice of the Plan and the Confirmation Hearing, as well as all deadlines for objecting to the Plan, has been given to all known non-asbestos creditors and holders of Interests.

         90. The program for providing notice of the Plan, Confirmation Hearing, and appointment of the FCR as legal representative for future Asbestos Claimants is reasonably calculated under the circumstances to apprise Asbestos Claimants of the Plan, Confirmation Hearing, and the appointment of the FCR as the legal representative for future Asbestos Claimants, and to afford Asbestos Claimants an opportunity to present their objections, and such program therefore provides constitutionally effective notice to the fullest extent achievable by law (Plan § 7.8(e)). Solicitation Procedures Order, ¶ 19; Wheatman Amended Affidavit passim (Docket No. 5374); Wheatman Affidavit passim (Docket No. 5919); Barry Dec. ¶¶ 5-17; Riggins Dec. ¶¶ 4-10; Gallardo-Garcia Dec. ¶¶ 4-10; Nownes-Whitaker Dec. ¶¶ 3-11.

         91. The program for providing notice of the Plan, Confirmation Hearing, and appointment of the FCR as the legal representative for future Asbestos Claimants was in fact implemented, and was reasonably calculated under the circumstances to apprise Asbestos Claimants of the Plan, Confirmation Hearing, and the appointment of the FCR as the legal representative for future Asbestos Claimants, and to afford Asbestos Claimants an opportunity to present their objections, and such program therefore provided constitutionally effective notice to the fullest extent achievable by law (Plan § 7.8(f)). See Wheatman Amended Affidavit passim (Docket No. 5374); Wheatman Affidavit passim (Docket No. 5919); Barry Dec. ¶¶ 5-17; Riggins Dec. ¶¶ 4-10; Gallardo-Garcia Dec. ¶¶ 4-10; Nownes-Whitaker Dec. ¶¶ 3-11.

         92. All Asbestos Claimants have been afforded due process based on the notice program described above, the appointment of the FCR as the legal representative for future Asbestos Claimants, and the Plan's compliance with Section 524(g) of the Bankruptcy Code (Plan § 7.8(11)). See Wheatman Amended Affidavit passim (Docket No. 5374); Wheatman Affidavit passim (Docket No. 5919); Barry Dec. ¶¶ 5-17; Riggins Dec. ¶¶ 4-10; Gallardo-Garcia Dec. ¶¶ 4-10; Nownes-Whitaker Dec. ¶¶ 3-11.

         D. The Plan Satisfies the Requirements of Section 1129 of the Bankruptcy Code

         93. Section 1129(a)(1).

         The Plan complies with all applicable provisions of the Bankruptcy Code, thereby satisfying Section 1129(a)(1). Among other provisions, as shown below, the Plan meets the requirements of Bankruptcy Rule 3016 and Sections 1122 and 1123 of the Bankruptcy Code.

         94. Bankruptcy Rule 3016(a).

         As required by Bankruptcy Rule 3016(a), the Plan is dated and identifies the Plan Proponents.

         95. Bankruptcy Rule 3016(b).

         The filing of the Disclosure Statement with the Bankruptcy Court satisfied Bankruptcy Rule 3016(b) in all the Chapter 11 Cases. The Disclosure Statement was filed in the Coltec Bankruptcy Case following its solicitation of acceptances prepetition. The Court finds and concludes that the Disclosure Statement contains, with respect to the Coltec Bankruptcy Case, adequate information within the meaning of Section 1125 of the Bankruptcy Code. The Court finds furdier that the Plan was transmitted before Coltec's petition to substantially all Coltec Asbestos Claimants in Class 5, that a reasonable time was given to such claimants to accept or reject the Plan, and that the solicitation complied with section 1126(b) of the Bankruptcy Code.

         96. Bankruptcy Rule 3016(c).

         The Plan and Disclosure Statement further satisfy Bankruptcy Rule 3016(c) by identifying, in specific and conspicuous language, both the acts to be enjoined by the Asbestos Channeling Injunction (and the other injunctions contained in the Plan) and the entities that are subject to the Asbestos Channeling Injunction and the other injunctions contained in the Plan.

         97. Sections 1122 and 1123.

         Compliance with Sections 1122 and 1123 of the Bankruptcy Code is also necessary for the Court to conclude that the Plan complies with Section 1129(a)(1) of the Bankruptcy Code. Here, for the reasons set forth below, the Plan complies with Sections 1122 and 1123.

         98. Section 1122(a).

         The Bankruptcy Code imposes a limitation on the classification of claims and interests, requiring that only substantially similar claims may be included in the same class. The Plan complies with Section 1122(a) because each class of claims and interests as set forth in Article 3 of the Plan consists solely of substantially similar Claims or Equity Interests.

         99. Section 1122(b).

         The Plan does not create a separate convenience class of claims, so Section 1122(b) does not apply.

         100. Section 1123(a)(1).

         The Plan satisfies Section 1123(a)(1) because it adequately and properly identifies and classifies all claims and interests in Article 3 of the Plan.

         101. Section 1123(a)(2).

         Section 1123(a)(2) of the Bankruptcy Code requires that the Plan must specify any class of claims or interests that is not impaired under the plan. Article 3 of the Plan identifies Classes 1, 2, 3, 4, 6, 7, 8, and 10 as being unimpaired. Accordingly, the Plan satisfies Section 1123(a)(2).

         102. Section 1123(a)(3).

         The Plan complies with Section 1123(a)(3) of the Bankruptcy Code, which requires that the Plan identify the treatment of each impaired class of claims and interests. Article 3 of the Plan identifies Classes 5 (Asbestos Claims) and 9 (GST/Garrison Equity Interests) as impaired, and sets forth the treatment of each such impaired class of claims or interests. Plan §§ 3.1.5 (Class 5) and 3.1.9 (Class 9).

         103. Section 1123(a)(4).

         The Plan provides for the same treatment for all claims or interests in each class, unless the holder of such claim or interest agrees to less favorable treatment, thereby satisfying Section 1123(a)(4) of the Bankruptcy Code.

         104. Section 1123(a)(5).

         Section 1123(a)(5) of the Bankruptcy Code requires that the Plan include adequate means for its implementation. The Plan complies with § 1123(a)(5) by, among other things, providing for: (a) vesting of assets in the Reorganized Debtors necessary to implement the Plan (Plan § 7.1); (b) appropriate amendment of the Debtors' organizational documents and maintenance of insurance coverage (Plan § 7.2); (c) creation of the Asbestos Trust (Plan § 7.3.1); (d) funding of and vesting of assets in the Asbestos Trust (Plan §§ 7.3.2, 7.3.2); (e) transfer of all Asbestos Claims to the Asbestos Trust (Plan §§ 7.3.3, 8.2); and (f) creation of the Asbestos Trust and mechanisms for its operation and governance (Plan §§ 7.3.5, 7.3.6, 7.3.7, 7.3.8, 7.3.9, Ex. B).

         105. Section 1123(a)(6).

         Section 1123(a)(6) of the Bankruptcy Code requires a plan to provide for the inclusion in the charter of the debtor, if the debtor is a corporation, or of any corporation to which the debtor transfers all or any part of the debtor's estate or with which the debtor has merged or consolidated, a provision prohibiting the issuance of non-voting equity securities. The Plan complies with Section 1123(a)(6) in that it prohibits issuance of nonvoting equity securities of the Reorganized Debtors that are corporations (Plan § 7.2.1).

         106. Section 1123(a)(7).

         Sections 7.3.5, 7.3.6, and 7.3.8 of the Plan and Sections IV, V, and VI of the Asbestos Trust Agreement contain provisions with respect to the manner of selection of the initial Asbestos Trustee, subsequent Asbestos Trustees, the CAC, and the FCR. Section 1.1.25 of the Plan identifies the initial Asbestos Trustee as Lewis R. Sifford. The initial members of the CAC are identified on the signature pages of the Asbestos Trust Agreement. In addition, Exhibit 4 to the Disclosure Statement identifies those persons who will serve as directors and key management personnel for the Reorganized Debtors. The Plan is consistent with public policy with respect to the manner of selection of directors, officers, and managers of the Debtors. Thus, the requirements of Section 1123(a)(7) of the Bankruptcy Code are satisfied.

         107. Section 1123(b)(2).

         Section 9.1 of the Plan, which provides for assumption or rejection of executory contracts, complies with the requirements of Section 365 of the Bankruptcy Code and thus satisfies Section 1123(b)(2).

         108. Section 1123(b)(3)(A).

         Section 1123(b)(3)(A) allows a plan to provide for settlement of any claim or interest belonging to the Debtors or their estate. The Plan provides for the settlements and releases described in Sections 8.4.1, 8.4.2, 8.4.3, and 8.4.4. The Court finds that each of these settlements and releases represents a good faith compromise; is in the best interest of the Debtors, the Debtors' estates, and the holders of Claims and Interests; is within the reasonable range of possible litigation outcomes; is fair and equitable; and is an essential element of the resolution of the Chapter 11 Cases in accordance with the Plan. Magee Dec. ¶¶ 79, 82, 96. Accordingly, the settlements and releases described in Sections 8.4.1, 8.4.2, 8.4.3, and 8.4.4 of the Plan are approved pursuant to Bankruptcy Rule 9019 and Section 105(a) of the Bankruptcy Code.

         109. Section 1123(b)(3)(B).

         The Plan permissibly provides for Retained Causes of Action, as authorized under Section 1123(b)(3)(B), and as set forth on Exhibit F to the Plan.

         110. Section 1129(a)(2).

         Section 1129(a)(2) of the Bankruptcy Code requires that the Plan Proponents comply with all applicable provisions of the Bankruptcy Code, including Section 1125. The Plan Proponents have satisfied this requirement. The Disclosure Statement distributed to creditors contained adequate information about the Plan. The mailing and publication of notice of the Disclosure Statement and Plan provided adequate notice of the Disclosure Statement and Plan to all creditors entitled to vote as required by Bankruptcy Rules 2002 and 3017. The Voting Procedures utilized by the Plan Proponents and approved by the Bankruptcy Court in the Solicitation Procedures Order satisfy all requirements of the Bankruptcy Code and Bankruptcy Rules, including, without limitation, Sections 1125 and 1126 of the Bankruptcy Code and Bankruptcy Rules 2002, 3017, and 3018. The solicitation of votes was conducted in accordance with procedures approved by the Bankruptcy Court.

         111. Section 1129(a)(3).

         The Plan has been proposed in good faith and not by any means forbidden by law. The Plan is the result of extensive negotiations among the Plan Proponents and EnPro, which used their best efforts to negotiate an agreement that will provide a fair and equitable mechanism for the orderly resolution of all present and future Asbestos Claims. Under the facts and circumstances of this Case, the Plan has been designed to achieve a fair and equitable treatment of all creditor Claims and Demands and is consistent with the purposes of the Bankruptcy Code. Magee Dec. ¶¶ 55-96; Inselbuch Dec. ¶¶ 20-56; Grier Dec. ¶¶ 26-32.

         112. The Plan constitutes a global compromise and settlement among the Plan Proponents and EnPro. In accordance with Bankruptcy Rule 9019, the Court finds and concludes that the Plan, and each compromise and release of Claims more particularly described therein, represents a good faith compromise; is in the best interest of the Debtors, the Debtors' estates, and the holders of Claims and Interests; is within the reasonable range of possible litigation outcomes; is fair and equitable; and is an essential element of the resolution of the Chapter 11 Cases in accordance with the Plan. Magee Dec. ¶¶ 79, 96.

         113. Section 1129(a)(4).

         Section 1129(a)(4) of the Bankruptcy Code provides that payments to be made to professionals for costs and expenses must be approved by the Bankruptcy Court. The Plan complies with this requirement in Section 5.3, which sets a bar date for Administrative Expense Claims and Fee Claims. The Plan further provides for payment of Allowed Administrative Expense Claims in accordance with the terms and conditions in the agreements underlying the transactions giving rise to such Administrative Expense Claims. Plan § 2.1.1. All payments made or to be made by Debtors, for services or for costs and expenses in connection with the Chapter 11 Case or in connection with the Plan, thus have been approved by or are subject to approval by the Bankruptcy Court.

         114. Section 1129(a)(5).

         The Plan complies with Section 1129(a)(5) because the Debtors have disclosed in the Plan Supplement the identity and affiliations of any individual who will act as a director, officer, or voting trustee of the Debtors or the successors of the Debtors after confirmation of the Plan, as well as any insiders to be employed or retained by the debtor and the nature of their compensation. The identity of the individuals proposed to serve, after confirmation of the Plan, as directors, officers, or managers of the Reorganized Debtors are disclosed in Exhibit 4 to the Disclosure Statement, and the appointment to, or continuance in, such offices of such individuals, is consistent with the interests of creditors, equity security holders, and public policy. The Debtors have disclosed the identity of all insiders who will be employed or retained by the Reorganized Debtors, and the nature of the compensation of such insiders. Disclosure Statement § 7.5.1, Ex. 4; Plan Supplement, Ex. N. In addition, the name of the initial Asbestos Trustee, Lewis R. Sifford, is disclosed in Section 1.1.25 of the Plan. The FCR is identified in Section 1.1.83 of the Plan, and the members of the CAC are listed on the signature pages of the Asbestos Trust Agreement.

         115. Section 1129(a)(6).

         Section 1129(a)(6) of the Bankruptcy Code is satisfied because the Plan does not provide for any change in rates over which a governmental regulatory commission has jurisdiction.

         116. Section 1129(a)(7).

         Section 1129(a)(7) of the Bankruptcy Code provides that each creditor or interest holder in an impaired class must either accept the plan or receive or retain under the plan on account of such claim or interest property of a value, as of the effective date of the plan, that is not less than the amount that such holder would so receive or retain if the debtor were liquidated under Chapter 7 of the Bankruptcy Code on such date. 11 U.S.C. § 1129(a)(7)(h). Each impaired class voted in favor of the Plan by the required number, amount, and percentage of claims voted. Those holders of claims that have not voted in favor of the Plan would receive less in a liquidation under Chapter 7 than they would receive under the Plan. Based upon the findings of fact contained herein, the Declarations submitted in support of confirmation, and the separate and alternative liquidation analyses provided by the Debtors and the Committee, this Court finds and concludes that the Plan satisfies Section 1129(a)(7) of the Bankruptcy Code. Dragelin Dec. ¶¶ 5-8, Ex. A; Bates Dec. ¶¶ 12 et seq.; Rapp Dec. ¶¶ 5 et seq. (as corrected, Docket No. 5927-1); Peterson Dec. ¶¶ 4 etseq. (as corrected, Docket No 5926-1).

         117. Section 1129(a)(8).

         The Plan satisfies Section 1129(a)(8) because each class of impaired claims or interests has voted to accept the plan.

         118. Section 1129(a)(9).

         The treatment of Administrative Expense Claims and Priority Tax Claims under the Plan satisfies the requirements of Sections 1129(a)(9)(A) and (B) of the Bankruptcy Code, and the treatment of Priority Tax Claims under the Plan satisfies the requirements of Section 1129(a)(9)(C) of the Bankruptcy Code. The Plan is sufficiently funded to pay all administrative and priority claims, and all priority claims will be treated as required under Section 1129(a)(9) of the Bankruptcy Code. Section 2.1.1 of the Plan provides for payment of Allowed Administrative Expense Claims as soon as practicable after the Effective Date or as ordered by the Bankruptcy Court, unless otherwise agreed between the Debtors and Holder of any such claim. Consistent with Section 1129(a)(9)(C) of the Bankruptcy Code, the Plan provides at Section 2.1.2 for payment of Priority Tax Claims in cash on the Distribution Date.

         119. Section 1129(a)(10).

         The Plan satisfies Section 1129(a)(10) because at least one impaired class of claims (Class 5) has voted to accept the Plan.

         120. Section 1129(a)(11).

         The Plan is feasible. Confirmation of the Plan is not likely to be followed by liquidation or the need for further financial reorganization of the Debtors or any successors. The Debtors will be in a position to consummate the Plan and to meet all of their obligations under the Plan. Childress Dec. ¶¶ 16-29; Magee Dec. ¶ 85.

         121. Section 1129(a)(12).

         Section 1129(a)(12) is satisfied because the fees payable under Section 1930 of title 28 of the United States Code, as determined by the Court at the Plan Confirmation Hearing, either have been paid or are to be paid under the Plan on the Distribution Date.

         122. Section 1129(d). The principal purpose of the Plan is not avoidance of taxes or avoidance of the requirements of Section 5 of the Securities Act of 1933, and there has been no request filed by any governmental unit asserting such avoidance.

         123. Adequate and sufficient notice of the Plan and the Confirmation Hearing, as well as all deadlines for objecting to the Plan, has been given to all parties in interest, including all known creditors and holders of Interests, all known GST Asbestos Claimants and Coltec Asbestos Claimants, and appropriate publication notice has been given with respect to unknown claimants. All Asbestos Claimants have been afforded due process based on the notice program described above, the appointment of the FCR as the legal representative for future Asbestos Claimants, and the Plan's compliance with Section 524(g) of the Bankruptcy Code, such that any holder of a GST Asbestos Claim or Coltec Asbestos Claim, among other parties, will be bound by the terms of the Plan Documents, this Confirmation Order, and the Asbestos Channeling Injunction. No further notice shall be required.

         124. As set forth in ¶¶ 93-123 above, the Plan complies in all respects with the applicable requirements of Section 1129 of the Bankruptcy Code.

         E. The Plan Satisfies the Requirements of Section 524(g) of the Bankruptcy Code

         125. For the reasons set forth below, the Plan complies with the requirements of Section 524(g) of the Bankruptcy Code for the issuance of the Asbestos Channeling Injunction and the establishment of the Asbestos Trust.

         126. The Asbestos Channeling Injunction is being implemented in connection with the Asbestos Trust pursuant to the Plan. 11 U.S.C. § 524(g)(2)(B)(i); Plan § 8.2.

         127. As of the Petition Date, each of GST, Garrison, and Coltec have been named as defendants in personal injury and wrongful death actions seeking recovery for damages allegedly caused by the presence of, or exposure to, asbestos or asbestos-containing products. 11 U.S.C. ...


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