IN THE UNITED STATES BANKRUPTCY COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
IN RE:
McNEIL REAL ESTATE FUND Case No. 394-33903-HCA-11
XXIII, L.P.,
Chapter 11
Debtor
DEBTOR'S FIRST AMENDED PLAN OF REORGANIZATION
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(AS MODIFIED)
This First Amended Plan of Reorganization is being proposed by McNeil
Real Estate Fund XXIII, L.P., Debtor and Debtor in Possession, for the benefit
of its creditors and interest holders:
I.
DEFINITIONS
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For the purposes of this Plan, the following terms shall have the
following meanings unless the context requires otherwise:
1. "Allowed Claim or Allowed Interest" means a Claim against or
interest in the Debtor (a) to the extent that a proof of claim was filed on or
before the claims Bar Date, or with leave of the Court or without objection by a
party in interest, filed after such date, or (b) as to which a party in
interest, including the Debtor, does not file an objection, or the claim or
interest is allowed by a Final Order of the Court, or (c) that was listed on the
Debtor's schedules and statement of affairs, or any amendments thereto, as
undisputed, liquidated and noncontingent and is not the subject of a proof of
claim or objection.
2. "Affiliate(s)" shall mean affiliate(s) as defined under 101(2) of
the Bankruptcy Code.
3. "Bankruptcy Code" or "Code" means the Bankruptcy Reform Act of 1978,
as amended, principally codified in 11 U.S.C. 101, et seq.
4. "Bar Date" means November 1, 1994.
5. "Beckley" means the partnership interest in the limited partnership
known as Beckley Associates Limited Partnership which owns the Harbour Club II
Apartment in Belleville, Michigan.
6. "Claim" means a right to payment, whether or not asserted, or as
otherwise set forth in 11 U.S.C. 101(4).
7. "Closing" means the date that Debtor completes the sale of the
Woodbridge Apartments as provided and defined in the Sales Agreement.
8. "Confirmation" and "Confirmation Date" mean, respectively, (a) the
entry by the Court of an Order confirming the Plan, or at or after a hearing
pursuant to 1129 of the Code, and (b) the date on which such order is signed.
9. "Consummation" shall occur upon the payment in full of the Classes
1, 2, 3, 4, and 6.
10. "Costs of Administration" means Allowed Claims pursuant to Section
503(b) of the Code that are entitled to priority under Section 507(a)(1) of the
Code.
11. "Court" means the United states Bankruptcy Court for the Northern
District of Texas, Dallas Division, or any court or tribunal subsequently
constituted to adjudicate matters arising under the Bankruptcy Code or any other
bankruptcy laws.
12. "Creditor" means a person or entity holding a Claim.
13. "Debtor" means McNeil Real Estate Fund XXIII, L.P., debtor and
debtor in possession in this bankruptcy case, a limited partnership, and as
reorganized pursuant to this Plan.
14. "Effective Date" means the first day after ten (10) business days
after the entry of the Order of the Court confirming the Plan, unless such Order
is stayed.
15. "Final Order" means an order of the Court as to which any appeal
that has been taken or may be taken has been resolved or the time for appeal has
expired.
16. "General Partner" shall mean the general partner of the Debtor,
McNeil Partners, L.P.
17. "HUD" means the United States Department of Housing and Urban
Development, which is the first lienholder of the Woodbridge Apartments.
18. "Interest Holder(s)" means the General and Limited Partners of the
Debtor, collectively or individually.
19. "Net Operating Income" shall mean income from property operations
(exclusive of refundable tenant deposits) minus operating expenses (including
but not limited to professional property management fees, monthly estimates for
property taxes and insurance, utility expenses, owner and general and
administrative expenses, and required property repairs and improvements,
including capital improvements).
20. "Plan" means this Plan of Reorganization, including any
modifications, amendments or corrections made in accordance with the provisions
of the Code.
21. "Purchaser" means the purchaser of the Woodbridge Apartments
pursuant to this Plan.
22. "Sales Agreement" shall mean the Real Estate Sales Agreement dated
as of January 24, 1995 between the Debtor and TGM Realty Corp. #4 which provides
for, among other things, the sale of the Woodbridge Apartments free and clear of
all liens, encumbrances, security interests, assignments and all other adverse
interests (other than the Permitted Exceptions as defined therein), including,
without limitation, all claims (as such term is defined in Section 101(5) of the
Bankruptcy Code) for a purchase price of $3,200,000, and terms of which are
incorporated herein by reference and in the event of a conflict between the Plan
and the Sales Agreement, the Sales Agreement shall control.
23. "Secured Claim" means an Allowed Claim or a portion of that Claim
as set forth in Section 506 of the Bankruptcy Code for which there is collateral
consisting of assets of the debtor which have been pledged to the holder of the
Claim for repayment of the Claim or for which the holder has a duly perfected
security interest under the federal or state law applicable to that type of
collateral. To the extent not a Secured Claim, a Claim or a portion of a Claim
is an Unsecured Claim.
24. "Unsecured Claim" means an Allowed Claim which is in whole or in
part: (1) not secured by a lien, security interest or other charge against or
interest in property on which Debtor has an interest; or (2) not subject to
setoff under Section 553 of the Bankruptcy Code. Unsecured Claims include
Creditors holding rejection claims pursuant to the rejection of any executory
contract under Section 365 of the Code.
25. "Woodbridge Apartments" means the Woodbridge Apartments located in
Wichita, Kansas.
26. "Woodbridge Company" means Woodbridge Company, L.P. which is the
second lienholder of the Woodbridge Apartments.
II.
CLASSIFICATION OF CLAIMS AND INTERESTS
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27. A Claim is in a particular class only to the extent the Claim
qualifies within the description of that class and is in a different class to
the extent the remainder of the Claim qualifies within the description of a
different class. A subclass shall constitute a separate class for voting
purposes. A Claim or Interest is in a particular class only to the extent the
Claim or Interest is an Allowed Claim or Interest as defined herein. Under this
Plan Classes 1, 2, 3 and 5 are unimpaired. Classes 4, 6, 7, 8 and 9 are
impaired. Administrative expenses are to be paid in the ordinary course of
business and are not separately classified.
28. Classification of Claims or Interests
Class 1: Class 1 consists of all holders of those claims
arising under ss.507(a)(1) through (a)(6), and any quarterly fees due and owing
the U.S. Trustee.
Class 2: Class 2 consists of all holders of priority tax
Claims as set forth in Section 507 of the Bankruptcy Code.
Class 3: Class 3 consists of the secured claim of HUD.
Class 4: Class 4 consists of the secured claim of the
Woodbridge Company.
Class 5: Class 5 consists of the holders of claims based on
claims for recision of limited partnership interest or other claims for damages
arising from the purchase or sale of a security of the Debtor. Subclass 5(a)
consists of those claimants in Class 5 who claim a judgment lien on assets of
the Debtor. Subclass 5(b) consists of those claimants in Class 5 who assert
unsecured claims.
Class 6: Class 6 consists of the holders of all general
Unsecured Claims, not included in Class 5 or Class 7.
Class 7: Class 7 consists of the holders of Unsecured Claims
of insiders of Affiliates of the Debtor.
Class 8: Class 8 consists of the Interest Holders of the
Debtor.
Class 9: Class 9 consists of all Secured Creditors who hold
mechanic's liens or materialmen's liens against the Woodbridge Apartments.
III.
TREATMENT OF CLASSES
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29. Class 1: The Allowed Claims of the Class 1 Creditors, including all
quarterly fees due and owing the U.S. Trustee, will be paid in cash in full on
the Effective Date of the Plan, or as soon thereafter as the allowed amount of
any such Claims are determined by Final Order. Class I is not impaired.
30. Class 2: The Allowed Claims of the Class 2 Creditors will be paid
in cash in full on the Effective Date of the Plan, or as soon thereafter as the
allowed amount of any such Claims are determined by Final Order. Class 2 is not
impaired.
31. Class 3: The Woodbridge Apartments shall be sold pursuant to the
terms and conditions of the Sales Agreement. The Class 3 Creditor's liens shall
attach in accordance with their priority to the proceeds generated by the sale
of the Woodbridge Apartments and will be paid in full on the later of the
Effective Date or Closing. The Class 3 Creditor shall not be allowed to seek the
appointment of a receiver or foreclose on its collateral unless Closing does not
occur on or before June 1, 1995. Class 4 is impaired.
32. Class 4: The Class 4 Creditor's liens shall attach in accordance
with their priority to the proceeds generated by the sale of the Woodbridge
Apartments and will be paid on the later of the Effective Date or Closing. The
Class 4 Creditor will receive from the sale of the Woodbridge Apartments on the
later of the Effective Date or Closing the amount of its claim less $40,000.00
in full satisfaction of their Claims against the Debtor. The Class 4 Creditor
shall not be allowed to seek the appointment of a receiver or foreclose on its
collateral unless Closing does not occur on or before June 1, 1995. Class 4 is
impaired.
33. Class 5: In satisfaction of the Class 5 Claims, each Class 5(a)
creditor will receive, in full satisfaction of their Claims against the Debtor,
their pro rata share of the cash proceeds from the sale of the Woodbridge
Apartments after payment of the Class 3 and Class 4 Claims under the plan in the
amount of $156,566.00 which includes all interest and attorneys' fees. This
amount will be paid on the later of the Effective Date or Closing. Class 5(b)
claims will be subordinated to the level of the Class 8 Interest Holders
pursuant to 11 U.S.C. ss. 510(b) and they will retain their limited partnership
interests under Class 8 in full satisfaction of their Claims against the Debtor.
34. Class 6: The Class 6 Unsecured Claims will be paid their pro rata
share of cash proceeds realized from the sale of the Woodbridge Apartments after
payment to the Class 1, 2, 3 and 4 Creditors on the later of (a) the next
business day after 30 days after Closing, and (b) the date such claim becomes an
Allowed Claim by Final Order in full satisfaction of their claims against the
Debtor. If Closing does not occur on or before June 1, 1995, the Class 6
Unsecured Claims will receive their pro rata share of unencumbered cash of the
Debtor. Class 6 is impaired.
35. Class 7: The Class 7 Unsecured Creditors will be paid their pro
rata share of the cash proceeds from the sale of the Woodbridge Apartments after
payment to the Class 1, 2, 3, 4 and 6 Creditors in full satisfaction of their
Claims against the Debtor. Class 7 is impaired.
36. Class 8: The Class 8 Interest Holders shall have the option (a) to
retain their ownership interests in the percentages and amounts set forth in the
debtor's Partnership Agreement, except as modified by the treatment provided to
Class 5, or (b) to redeem their interest pursuant to paragraph 45 of the Plan.
Class 8 is impaired.
37. Class 9: The Class 9 Creditors, if any, will be paid in full on the
later of the Effective Date or Closing. The Class 9 Creditors' liens shall
remain in effect until Closing. If Closing does not occur by June 1, 1995, then
the Class 9 Creditors will receive their pro rata share of unencumbered cash of
the Debtor. Class 9 is impaired.
IV.
Execution and Implementation of the Plan
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38. The Debtor or any other party in interest may object to any Claim.
All objections to Claims must be filed on or before the later to occur of (1)
ninety (90) days after the Effective Date, or (2) ninety (90) days after the
receipt by the Debtor of a Proof of Claim of such Claim made after the Effective
Date.
39. No distribution or payment shall be made under this Plan which
would result in any Creditor receiving any payment or property in excess of that
specifically provided for in this Plan. To the extent that any distribution or
payment would result in any Creditor receiving more than specifically provided
for in this Plan, such distribution or payment, to such extent, shall be made to
the Debtor.
40. Upon Confirmation, all assets and property of every nature
of the Debtor, other than the distributions to be made hereunder, shall vest in
the Debtor.
41. Upon the Effective Date, Debtor shall execute all promissory notes,
mortgages, deeds, and other documentation which may be attached as exhibits to
this Plan and Disclosure Statement or which are necessary to document the
obligations set forth herein.
42. The Debtor will sell, pursuant to 11 U.S.C. ss.363(f), the
Woodbridge Apartments in an arm's length transaction, for a total purchase price
in excess of the Class 3 and Class 4 Claims, free and clear of all liens, claims
and encumbrances, except for Permitted Exceptions (as defined in the Real Estate
Sales Agreement). If Closing does not occur on or prior to June 1, 1995, the
Class 3 and Class 4 Creditors shall be allowed to have a receiver appointed for
the Woodbridge Apartments and foreclose on the Woodbridge Apartments.
43. The limited partnership agreement shall be modified to authorize
the issuance of additional units of limited partnership interests as provided in
this Plan.
44. The Debtor shall retain its interest in Beckley.
45. On or before 120 days after the Effective Date, the Debtor will
send an election form for each limited partner to make a one-time choice whether
to redeem their interest to the Debtor. The election to redeem the limited
partner interest must be returned to the Debtor within 30 days after it is
distributed. The redemption price would be 1/1000th of a cent per unit of
limited partnership interest. Notwithstanding any other provision of this plan,
if the Debtor is not able to secure a "no action" letter from the Securities and
Exchange Commission in a form satisfactory to the Debtor in its sole and
absolute discretion within 120 days after the Effective Date, then this
paragraph shall be void and the limited partners will retain their interests.
The "no-action" letter shall, at a minimum, provide that the purchase of
partnership interests can be accomplished without compliance with Rule 13e-3 of
the Securities Exchange Act of 1934 and that the Securities Exchange Commission
has not been advised by the Division issuing the letter to pursue an enforcement
action if the Plan is consummated. In the event that a "no-action" letter
satisfactory to the Debtor is not issued by the SEC, the limited partners shall
retain their interests. If one hundred percent (100%) of the limited partners
elect to redeem their interests, then this paragraph shall be void and the
limited partners will retain their interests.
V.
EXECUTORY CONTRACTS
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46. Unless the Debtor files an application to assume executory
contracts prior to or within thirty (30) days after the Closing, or unless
rejected or modified during the proceedings in this bankruptcy case, including
through this Plan, each executory contract or unexpired lease of Debtor shall be
rejected as of Closing. The Debtor shall assume and assign to the Purchaser all
leases with tenants, as well as such service contracts as the Purchaser
designates pursuant to the Real Estate Sales Agreement to sell the Woodbridge
Apartments. Executory contracts or unexpired leases modified during the case, if
not already assumed, shall be rejected, as modified, as of Closing.
VI.
PROVISIONS FOR THE RETENTION, ENFORCEMENT,
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SETTLEMENT OR ADJUSTMENT OF CLAIMS BELONGING
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TO THE DEBTOR OR TO THE ESTATE
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47. All rights pursuant to Sections 502, 544, 545, 546, 547, 548, and
553 of the Bankruptcy Code, all claims relating to post-petition transactions
under Section 549 of the Bankruptcy Code, all claims and causes of action
against any third party on account of an indebtedness or any other claim owed to
or in favor of the Debtor and on account of any action or omission by any third
party creating liability to or in favor of the Debtor are hereby preserved and
retained for enforcement by the Debtor for the benefit of their creditors
subsequent to the Effective Date of the Plan. Such claims of the Debtor against
third parties may be used by the Debtor to offset any payment due to such person
under the Plan.
VII.
RETENTION OF JURISDICTION
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48. Until this case is closed, the Court shall have jurisdiction of all
matters arising under, arising out of or relating to those proceedings,
notwithstanding the limitations set forth in 28 U.S.C ss. 157(b), including, but
not limited to proceedings:
(i) To insure that the purpose and intention of the Plan are carried
out;
(ii) To approve sales or refinancing relating to the assets of the
Debtor;
(iii) To consider any modification of this Plan under Section 1127 of
the Bankruptcy Code and/or modification of this Plan after substantial
consummation as defined in Section 1101 of the Bankruptcy Code;
(iv) To hear and determine all claims, controversies, suits and
disputes against the Debtor;
(v) To hear, determine and enforce all claims and causes of actions
which may exist on behalf of the Debtor or its estate, including, but not
limited to, any right of the Debtor or its estate to recover assets pursuant to
the provisions of the Bankruptcy Code; whether or not such claims, causes or
rights are enumerated in Article VI hereinabove;
(vi) To hear and determine all controversies, suits and disputes that
may arise in connection with the interpretation or enforcement of the Plan;
(vii) To hear and determine all requests for compensation and/or
reimbursement of expense which may be made under the Effective Date of the Plan;
(viii) To hear and determine all objections to claims, reinstatement of
debt issues, controversies, suits and disputes that may be pending at or
initiated after the Effective Date of the Plan, except as provided in the Final
Order confirming the Plan;
(ix) To consider and act on the compromise and settlement of any claim
against or cause of action in behalf of the Debtor or its estate;
(x) To enforce and interpret by injunction or otherwise the terms and
conditions of the Plan;
(xi) To enter any order, including injunction, necessary to enforce the
title, rights and powers of the Debtor and to impose such limitations,
restrictions, terms and conditions on such title, rights and powers as this
Court may deem necessary;
(xii) To enter an order concluding and terminating this case;
(xiii) To correct any defect, cure any omission, or reconcile any
inconsistency in the Plan or Final Order confirming the Plan which may be
necessary or helpful to carry out the purpose and intent of the Plan;
(xiv) To determine all questions and disputes regarding title to the
assets of the Debtor and its estate;
(xv) To classify the claims of any creditors and to re-examine claims
which have been allowed for purposes of voting, and to determine objections
which may be filed to creditors' claims;
(xvi) To consider and act on such other matters consistent with this
Plan as may be provided in the Final Order confirming the Plan;
(xvii) To consider the rejection of executory contracts that are not
discovered prior to confirmation and allow claims for damages with respect to
the rejections of any such executory contracts within such further time as this
Court may direct.
(xviii) To determine all offset rights, if any, of the Debtor including
but not limited to the right to offset payments due to Class 3 or 4 claimants
under the terms of the modified notes and deeds set forth herein due to their
failure to improperly apply or allocate payments received prior to confirmation.
VIII.
DISCHARGE
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1. Confirmation of this Plan and the Debtor's compliance with the terms
of the Plan shall confer upon the Debtor a discharge of all obligations treated
herein as provided for under Section 1141 of the Code.
RESPECTFULLY SUBMITTED this _____ day of February, 1995.
McNEIL REAL ESTATE FUND XXIII, L.P.
By: McNeil Partners, L.P.,
Its General Partner
By: McNeil Investors, Inc.,
Its General Partner,
By:
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Name:
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Vice President
/s/ Harold C. Abramson
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THE HONORABLE HAROLD C. ABRAMSON
UNITED STATES BANKRUPTCY JUDGE