RNI Wind Down requests approval of settlement resolving claims involving company officer

By Caroline Salls

Pittsburgh, Aug. 30 - RNI Wind Down Corp. requested court approval of a settlement that resolves all of the claims held by the company, the official committee of equity security holders, the company's estates and the wind-down trust arising from Noah D. Mesel's role as an officer of the company, according to a Wednesday filing with the U.S. Bankruptcy Court for the District of Delaware.

The official committee of unsecured creditors is also a party to the settlement.

RNI Wind Down said the motion constitutes the report identifying Mesel as a defendant under the plan in connection with the equity committee's investigation of potential RNI Wind Down causes of action.

Under the settlement:

• Mesel will forfeit $175,000 of his non-indemnification claims against the estate, the balance of which will be paid under the plan of liquidation;

• Mesel will forfeit the first $0.95 per share payable to him on account of his restricted stock and options equity interests, with the balance to be paid under the plan;

• Mesel will retain all rights under the directors' and officers' liability insurance in connection with a plan reserve;

• Upon confirmation of the plan, the equity committee will withdraw its motion to have Mesel designated a non-complying person under the plan;

• On the plan effective date, all the same plan releases that apply to other officers and directors will apply to Mesel, and Mesel will release the creditors committee and the equity committee in connection with investigation-related matters;

• Mesel will be paid at his current rate through Sept. 30, and after that will negotiate an appropriate pay with the plan administrator or liquidating trustee; and

• The estates will provide Mesel with ongoing information related to resolution of claims so he can help in the claims resolution process.

A hearing is scheduled for Sept. 7.

RNI, formerly Riverstone Networks, Inc., a Santa Clara, Calif., provider of carrier ethernet routers, filed for bankruptcy on Feb. 7. Its Chapter 11 case number is 06-10110.

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