UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE
In re
Chapter 11
KASH N' KARRY FOOD STORES, INC., Case No. 94-1082
Hon. Helen S. Balick
Debtor.
FIRST AMENDED PLAN OF REORGANIZATION
OF
KASH N' KARRY FOOD STORES, INC.
December 12, 1994
Kramer, Levin, Naftalis, Young, Conaway, Stargatt
Nessen, Kamin & Frankel & Taylor
Counsel to the Debtor Counsel to the Debtor
and Debtor-in-Possession and Debtor-in-Possession
919 Third Avenue 11th Floor -- Rodney Square
New York, New York 10022 P.O. Box 391
Wilmington, Delaware 19899
TABLE OF CONTENTS
Page
Article I Definitions................................... A-3
Article II. Administrative Expense Claims and Priority
Tax Claims....................................A-11
Article III. Classification................................A-12
Article IV. Treatment of Unimpaired Classes...............A-13
Article V. Treatment of Impaired Classes.................A-14
Article VI. No Bar Date; Disputed Claims; Objections
to Claims.....................................A-16
Article VII. Implementation of the Plan....................A-17
Article VIII. Executory Contracts and Unexpired Leases......A-23
Article IX. Conditions Precedent..........................A-24
Article X. Modification, Revocation or Withdrawal of
the Plan......................................A-25
Article XI. Retention of Jurisdiction.....................A-26
Article XII. Miscellaneous Provisions......................A-27
Exhibits
A New Bank Credit Agreement Term Sheet
B Form of New Management Services Agreement
C Form of New Senior Fixed Rate Note Indenture
D Form of New Senior Floating Rate Note Indenture
E Form of Restated Certificate of Incorporation
F Form of Securities Purchase Agreement
EXHIBITS TO THE PLAN ARE AVAILABLE UPON WRITTEN REQUEST TO
KRAMER, LEVIN, NAFTALIS, NESSEN, KAMIN & FRANKEL, 919 THIRD
AVENUE, NEW YORK, NEW YORK 10022, ATTN: MICHAEL J. SAGE
Kash n' Karry Food Stores, Inc., as debtor and debtor-in-
possession, proposes this first amended plan of reorganization
pursuant to section 1121 (a) of title 11 of the United States
Code:
ARTICLE I.
DEFINITIONS
Rules of Interpretation. As used herein, the following
terms have the respective meanings specified below, and such
meanings shall be equally applicable to both the singular and
plural, and masculine and feminine, forms of the terms defined.
The words "herein," "hereof," "hereto," "hereunder" and others of
similar import, refer to the Plan as a whole and not to any
particular section, subsection or clause contained in the Plan.
Captions and headings to articles, sections and exhibits are
inserted for convenience of reference only and are not intended
to be part of or to affect the interpretation of the Plan. The
rules of construction set forth in section 102 of the Bankruptcy
Code shall apply. In computing any period of time prescribed or
allowed by the Plan, the provisions of Bankruptcy Rule 9006(a)
shall apply. Any capitalized term used herein that is not
defined herein but is defined in the Bankruptcy Code shall have
the meaning ascribed to such term in the Bankruptcy Code. In
addition to such other terms as are defined in other sections of
the Plan, the following terms (which appear in the Plan as
capitalized terms) have the following meanings as used in the
Plan.
1.01. Administrative Expense Claim means any Claim
(including, without limitation, any Claim arising under the DIP
Facility or the Cash Collateral Order) entitled to the priority
afforded by sections 503(b) and 507(a)(1) of the Bankruptcy Code.
1.02. Allowed means, with respect to any Claim, a Claim as
to which no objection to the allowance thereof, or motion to
estimate for purposes of allowance, shall have been Filed on or
before any applicable period of limitation that may be fixed by
the Bankruptcy Code, the Bankruptcy Rules and/or the Bankruptcy
Court, or as to which any objection, or any motion to estimate
for purposes of allowance, shall have been so Filed, to the
extent allowed by a Final Order; provided that all Class 6 Claims
(excluding any Claims arising pursuant to Article VIII of the
Plan) shall be treated for all purposes as if the Chapter 11 Case
was not filed, and the determination of whether any such Claim
shall be allowed and/or the amount thereof (which shall not be
listed on the Schedules, and as to which no proof of Claim need
be Filed) shall be determined, resolved or adjudicated, as the
case may be, in the manner in which such Claim would have been
determined, resolved or adjudicated if the Chapter 11 Case had
not been commenced.
1.03. Ballot Agent means Shawmut Bank Connecticut, N.A.
1.04. Ballot Record Date means August 29, 1994.
1.05. Ballot Return Date means 5:00 p.m., New York City
time, on November 8, 1994, unless and to the extent such date is
extended by the Debtor in accordance with the provisions of the
Disclosure Statement.
1.06. Ballots means the ballots and/or master ballots
distributed to the holders of Old Senior Floating Rate Notes, Old
Senior Fixed Rate Notes, Old Subordinated Debentures and Banks'
Secured Claims for the purposes of voting on the Plan and, with
respect to the holders of Old Senior Floating Rate Notes and Old
Senior Fixed Rate Notes, making the election contemplated by
Section 5.02 hereof.
1.07. Bankruptcy Code means the Bankruptcy Reform Act of
1978, as amended from time to time, set forth in sections 101 et
seq. of title 11 of the United States Code.
1.08. Bankruptcy Court means the United States Bankruptcy
Court for the District of Delaware, or such other court that
exercises jurisdiction over the Chapter 11 Case or any proceeding
therein, including the United States District Court for the
District of Delaware to the extent that the reference of the
Chapter 11 Case or any proceeding therein is withdrawn.
1.09. Bankruptcy Rules means, collectively, the Federal
Rules of Bankruptcy Procedure, as amended and promulgated under
section 2075, title 28 of the United States Code, and the local
rules and standing orders of the Bankruptcy Court.
1.10. Banks means Bank of America National Trust and
Savings Association, as agent and lender, Wells Fargo Bank, N.A.,
Barnett Bank of Tampa and NationsBank of Florida, N.A., as
lenders pursuant to the Credit Agreement, and their successors
and assigns thereunder.
1.11. Banks' Secured Claims means the Secured Claims of the
Banks which, for purposes of the Plan, shall be deemed to be
Allowed in an amount equal to the excess of (a) the sum of
(i) all of the Obligations (as such term is defined in the Credit
Agreement) as of the Petition Date (including, without
limitation, the amounts described in the Cash Collateral Order),
(ii) an amount equal to 100% of the interest that accrued
pursuant to the Credit Agreement at the contract rate from and
including the Petition Date through and including the Effective
Date, (iii) all amounts owed to the Banks pursuant to the Cash
Collateral Order, (iv) all payments required under Eligible
Interest Rate Contracts and all Letter of Credit Obligations (as
such terms are defined in the Credit Agreement) from and
including the Petition Date through and including the Effective
Date and (v) to the extent provided by the Loan Documents (as
such term is defined in the Credit Agreement), an amount equal to
100% of any and all costs and expenses, including, without
limitation, attorneys' fees which remain unpaid as of the
Effective Date over (b) the sum of all payments made in cash by
the Debtor to the Banks pursuant to sections 361, 363 and/or 364
of the Bankruptcy Code prior to the Effective Date on account of
the obligations described in subparagraph (a) herein.
1.12. Bondholder Committee means an unofficial committee of
holders of the Old Notes, collectively holding 33%, 42% and 59%
in aggregate outstanding principal amount of the Old Senior
Floating Rate Notes, the Old Senior Fixed Rate Notes and the Old
Subordinated Debentures, respectively, which participated in the
negotiation of the proposed terms of the Plan and certain of the
transactions contemplated thereby, and whose members are Alliance
Capital Management L.P., American Capital Asset Management Inc.,
IDS Financial Corporation, PaineWebber Incorporated, The
Prudential Insurance Company of America and Sun America Asset
Management Corp.
1.13. Business Day means a day other than a Saturday,
Sunday or other day on which banks in New York, New York are
authorized or required by law to be closed.
1.14. Cash Collateral Order means any and all consensual
order(s) of the Bankruptcy Court authorizing the Debtor to use,
subject to the terms and provisions thereof, the Banks' cash
collateral (as such term is defined in section 363(a) of the
Bankruptcy Code) and non-cash collateral.
1.15. Chapter 11 Case means the case under chapter 11 of
the Bankruptcy Code with respect to the Debtor, pending or to be
pending in the District of Delaware, administered as In re Kash
n' Karry Food Stores, Inc., Chapter 11 Case No. .
1.16. Claim means (a) any right to payment from the Debtor
arising before the Confirmation Date, whether or not such right
is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal,
equitable, secured or unsecured or (b) any right to an equitable
remedy against the Debtor arising before the Confirmation Date
for breach of performance if such breach gives rise to a right of
payment from the Debtor, whether or not such right to an
equitable remedy is reduced to judgment, fixed, contingent,
matured, unmatured, disputed, undisputed, secured or unsecured.
1.17. Class means one of the classes of Claims or Interests
defined in Article III hereof.
1.18. Confirmation Date means the date on which the
Confirmation Order is entered on the docket by the Clerk of the
Bankruptcy Court.
1.19. Confirmation Order means the order of the Bankruptcy
Court confirming the Plan in accordance with the provisions of
chapter 11 of the Bankruptcy Code.
1.20. Credit Agreement means the Credit Agreement, dated as
of October 12, 1988, as amended, modified, restated or supple-
mented from time to time, between the Debtor and the Banks.
1.21. Creditors' Committee means the official committee of
unsecured creditors appointed in the Chapter 11 Case by the
United States Trustee pursuant to section 1102 of the Bankruptcy
Code, as constituted by the addition or removal of members from
time to time.
1.22. Debtor means Kash n' Karry Food Stores, Inc., as
debtor and debtor-in-possession in the Chapter 11 Case.
1.23. Deferred Compensation Claim means any Claim which may
be asserted by any former employee of the Debtor under any
employment agreement, severance agreement or deferred
compensation agreement pursuant to which the Debtor is a party
and which arises, or is alleged to have arisen, upon the
occurrence of (a) the termination of such employee's employment
with the Debtor and (b) a "Change in Control" (as such phrase is
defined under such agreement).
1.24. DIP Facility means the obligations of the Debtor
under any debtor-in-possession financing incurred by the Debtor
pursuant to section 364 of the Bankruptcy Code (other than
pursuant to the Cash Collateral Order), together with the
documents, agreements and order(s) of the Bankruptcy Court
authorizing and governing such obligations.
1.25. Disclosure Statement means the Debtor's Disclosure
Statement, dated September 2, 1994, as amended, modified,
restated and supplemented by the Supplement and as further
amended, modified, restated or supplemented from time to time,
pertaining to the Plan.
1.26. Distribution Record Date means the date on which the
Confirmation Order is signed.
1.27. Effective Date means the Business Day on which all of
the conditions specified in Section 9.01 hereof are first
satisfied and/or waived in accordance with Article IX of the
Plan.
1.28. Employee Claim means a Claim based on salaries,
wages, sales commissions, expense reimbursements, accrued
vacation pay, health-related benefits, incentive programs,
employee compensation guarantees severance or similar employee
benefits.
1.29. Filed means filed with the Bankruptcy Court in the
Chapter 11 Case.
1.30. Final Order means an order or judgment entered on the
docket by the Clerk of the Bankruptcy Court or any other court
exercising jurisdiction over the subject matter and the parties
(a) that has not been reversed, stayed, modified or amended,
(b) as to which no appeal, certiorari proceeding, reargument or
other review or rehearing has been requested or is still pending
and (c) as to which the time for filing a notice of or petition
for certiorari, or request for reargument or further review or
rehearing shall have expired.
1.31. Financing Lease means any lease pursuant to which the
Debtor is the lessee that is intended to grant a security
interest in the leased property to the lessor under such lease.
1.32. Fulcrum Partnerships means The Fulcrum III Limited
Partnership and The Second Fulcrum III Limited Partnership.
1.33. GEI means Green Equity Investors, L.P., a Delaware
limited partnership of which LGP is general partner.
1.34. GGvA means Gibbons, Goodwin, van Amerongen, f/k/a
Gibbons, Green, van Amerongen.
1.35. Interest means the rights of the owners of the issued
and outstanding shares of the Old Series B Preferred Stock, the
Old Series C Preferred Stock, the Old Common Stock and the Old
Options, respectively.
1.36. Lease Secured Claim means any Claim of a lessor under
a Financing Lease.
1.37. LGP means Leonard Green & Partners, L.P., a Delaware
limited partnership.
1.38. New Bank Credit Agreement means an agreement, to be
dated as of the Effective Date, among the Reorganized Debtor, the
Banks, The CIT Group/Business Credit, Inc. and any other lender
that from time to time becomes a party to such agreement,
pursuant to which the Reorganized Debtor shall have, among other
things, credit availability from and after the Effective Date, on
substantially the terms set forth in Exhibit A to the Plan,
together with such other terms and conditions as are acceptable
to the parties to such agreement.
1.39. New Common Stock means the common stock, $0.01 par
value per share, of the Reorganized Debtor, authorized for
issuance pursuant to the Restated Certificate of Incorporation.
1.40. New Indentures means the New Senior Fixed Rate Note
Indenture and the New Senior Floating Rate Note Indenture.
1.41. New Management Services Agreement means an agreement
pursuant to which LGP shall provide the Reorganized Debtor with
management, consulting, financial planning and financial advisory
services in return for an annual fee of $200,000, the term of
which shall commence on the Effective Date and terminate on the
second anniversary date thereof, substantially in the form of
Exhibit B to the Plan.
1.42. New Notes means the New Senior Fixed Rate Notes and
the New Senior Floating Rate Notes.
1.43. New Preferred Stock means the preferred stock $.01
par value per share of the Reorganized Debtor, authorized for
issuance pursuant to the Restated Certificate of Incorporation.
1.44. New Senior Fixed Rate Notes means the 11 1/2% Senior
Fixed Rate Notes due February 1, 2003, issuable pursuant to the
New Senior Fixed Rate Note Indenture and described in the
Disclosure Statement.
1.45. New Senior Fixed Rate Note Indenture means the New
Senior Fixed Rate Note Indenture, dated as of the Effective Date,
to be entered into by the Reorganized Debtor with respect to the
New Senior Fixed Rate Notes, substantially in the form of Exhibit
C to the Plan.
1.46. New Senior Floating Rate Notes means the Senior
Floating Rate Notes due February 1, 2003, bearing interest at
LIBOR plus 2%, issuable pursuant to the New Senior Floating Rate
Note Indenture and described in the Disclosure Statement.
1.47. New Senior Floating Rate Note Indenture means the New
Senior Floating Rate Note Indenture, dated as of the Effective
Date, to be entered into by the Reorganized Debtor with respect
to the New Senior Floating Rate Notes, substantially in the form
of Exhibit D to the Plan.
1.48. Old Common Stock means the common stock, $.01 par
value per share, of the Debtor.
1.49. Old Equity Interests means the Old Series B Preferred
Stock, the Old Series C Preferred Stock, the Old Common Stock and
the Old Options.
1.50. Old Indentures means the Old Senior Fixed Rate Note
Indenture, the Old Senior Floating Rate Note Indenture and the
Old Subordinated Debenture Indenture.
1.51. Old Management Services Agreements means certain oral
agreements between the Debtor and GGvA and the Debtor and LGP,
pursuant to which the Debtor agreed to pay GGvA and LGP,
respectively, certain annual fees and related expenses in return
for the provision of management, consulting, financial planning
and financial advisory services.
1.52. Old Notes means the Old Senior Fixed Rate Notes, the
Old Senior Floating Rate Notes and the Old Subordinated
Debentures.
1.53. Old Options means all outstanding rights, as of the
Petition Date, to acquire Old Common Stock, including, without
limitation, (a) all options issued pursuant to the Old Stock
Option Plans, (b) all warrants issued pursuant to the Old Warrant
Agreements and (c) all rights to receive or acquire such options
or warrants.
1.54. Old Senior Fixed Rate Note Claim means a Claim of a
holder of Old Senior Fixed Rate Notes which, for purposes of the
Plan, shall be deemed to be an amount equal to the sum of (a) the
face amount of Old Senior Fixed Rate Notes held by such holder
and (b) an amount equal to 100% of the interest that accrued at
the contract rate on such Old Senior Fixed Rate Notes from and
including February 2, 1994, through but not including the
Petition Date.
1.55. Old Senior Fixed Rate Notes means the Debtor's 12*%
Senior Notes due February 1, 1999, as amended, modified, restated
or supplemented from time to time.
1.56. Old Senior Fixed Rate Note Indenture means the
Indenture, dated as of January 29, 1992, as amended, modified,
restated or supplemented from time to time, between the Debtor
and Ameritrust Texas, N.A., as indenture trustee, relating to the
Old Senior Fixed Rate Notes.
1.57. Old Senior Floating Rate Note Claim means a Claim of
a holder of Old Senior Floating Rate Notes which, for purposes of
the Plan, shall be deemed to be an amount equal to the sum of
(a) the face amount of Old Senior Floating Rate Notes held by
such holder and (b) an amount equal to 100% of the interest that
accrued at the contract rate on such Old Senior Floating Rate
Notes from and including February 3, 1994, through but not
including the Petition Date.
1.58. Old Senior Floating Rate Notes means the Debtor's
Senior Floating Rate Notes due August 2, 1996, as amended,
modified, restated or supplemented from time to time.
1.59. Old Senior Floating Rate Note Indenture means the
Indenture, dated as of September 14, 1989, as amended, modified,
restated or supplemented from time to time, between the Debtor
and NationsBank of Florida, N.A., as indenture trustee, relating
to the Old Senior Floating Rate Notes.
1.60. Old Series B Preferred Stock means the Series B
Preferred Stock, par value $.01 per share, of the Debtor.
1.61. Old Series C Preferred Stock means the Series C
Preferred Stock, par value $.01 per share, of the Debtor.
1.62. Old Stock Option Plans means (a) the Debtor's
Restated 1988 Management Stock Option Plan, as amended, modified,
restated or supplemented from time to time and (b) the Debtor's
1991 Management Stock Option Plan, as amended, modified, restated
or supplemented from time to time.
1.63. Old Stockholders' Agreement means the Stockholders'
Agreement, dated as of November 26, 1991, as amended, modified,
restated or supplemented from time to time, among the Debtor, GEI
and the Fulcrum Partnerships.
1.64. Old Subordinated Debentures means the Debtor's 14%
Subordinated Debentures due February 1, 2001, as amended,
modified, restated or supplemented from time to time.
1.65. Old Subordinated Debenture Indenture means the
Indenture, dated as of February 8, 1989, as amended, modified,
restated or supplemented from time to time, between the Debtor
and The Bank of New York, as successor indenture trustee,
relating to the Old Subordinated Debentures.
1.66. Old Warrant Agreements means the Note and Warrant
Purchase Agreement, dated as of February 1, 1994, between the
Debtor and GEI, as amended, modified, restated or supplemented
from time to time and the Agreement, dated as of October 12,
1988, between the Debtor and Lucky Stores, Inc., as amended,
modified, restated or supplemented from time to time.
1.67. Other Priority Claim means any Claim for an amount
entitled to priority in right of payment under section 507(a)
(3), (4), (5) or (6) of the Bankruptcy Code.
1.68. Petition Date means November 9, 1994, the date on
which the petition of relief commencing the Chapter 11 Case was
filed.
1.69. Plan means this first amended plan of reorganization,
as amended, modified, restated or supplemented from time to time.
1.70. Post-Restructuring Board means the Board of Directors
of the Reorganized Debtor as of the Effective Date, as provided
in Section 7.12 hereof.
1.71. Priority Tax Claim means a Claim, other than an
Administrative Expense Claim, of a governmental unit of the kind
entitled to priority under section 507(a)(7) of the Bankruptcy
Code.
1.72. Reorganized Debtor means the Debtor from and after
the Effective Date.
1.73. Restated Certificate of Incorporation means the
restated certificate of incorporation of the Debtor,
substantially in the form of Exhibit E to the Plan, which shall,
among other things, (a) authorize the issuance of 5.5 million
shares of New Common Stock and 1.0 million shares of New
Preferred Stock, (b) provide for the cancellation of the Old
Equity Interests and (c) prohibit the issuance of non-voting
equity securities to the extent required by section 1123(a)(6) of
the Bankruptcy Code.
1.74. Schedules means the schedules of assets and
liabilities and the statement of financial affairs Filed by the
Debtor pursuant to section 521 of the Bankruptcy Code, as
amended, modified, restated or supplemented from time to time.
1.75. Secured Claim means any Claim against the Debtor held
by any Entity, including, without limitation, an Affiliate or
judgment creditor of the Debtor, to the extent such Claim
constitutes a secured Claim under sections 506(a) or 1111(b) of
the Bankruptcy Code.
1.76. Securities Purchase Agreement means an agreement
between the Debtor and GEI, substantially in the form of
Exhibit F to the Plan, pursuant to which the Reorganized Debtor
will raise an aggregate of $10.0 million of new capital through
the issuance to GEI of 465,000 shares of New Common Stock, which
shall constitute 15% of the New Common Stock outstanding on the
Effective Date.
1.77. Shelf Registration Statement means a "shelf"
registration statement filed by the Reorganized Debtor on any
appropriate form pursuant to the Securities Act of 1933, as
amended, and/or any similar rule that may be adopted by the
Securities and Exchange Commission, in accordance with Section
12.02 hereof.
1.78. Supplement means the Debtor's supplement to the
Disclosure Statement, dated October 28, 1994, as amended,
modified, restated or supplemented from time to time, pertaining
to the Plan.
1.79. Trade Claim means any Claim of any Entity against the
Debtor for goods provided and/or services rendered in the
ordinary course by such Entity to the Debtor.
ARTICLE II.
ADMINISTRATIVE EXPENSE CLAIMS AND PRIORITY TAX CLAIMS
2.01. Administrative Expense Claims and Priority Tax
Claims. Each holder of an Allowed Administrative Expense Claim
and each holder of an Allowed Priority Tax Claim shall be paid in
full in cash on the later of (a) the Effective Date and (b) the
date on which such Claim becomes Allowed, unless such holder
shall agree to a different treatment of such Claim (including,
without limitation, any different treatment that may be provided
for in any documentation, statute or regulation governing such
Claim); provided, however, that Trade Claims and Employee Claims
shall be paid by the Debtor or assumed and paid by the
Reorganized Debtor in the ordinary course of business and in
accordance with any terms and conditions of the particular
transaction, and any agreements relating thereto.
ARTICLE III.
CLASSIFICATION
For purposes of the Plan, Claims and Interests are
classified as provided below. A Claim or Interest is classified
in a particular Class only to the extent that such Claim or
Interest qualifies within the description of such Class and is
classified in a different Class to the extent that such Claim or
Interest qualifies within the description of such different
Class.
3.01. Class 1: Other Priority Claims. Class 1 consists of
all Other Priority Claims.
3.02. Class 2: Miscellaneous Secured Claims. Class 2
consists of all Lease Secured Claims and all Secured Claims,
other than the Banks' Secured Claims.
3.03. Class 3: Banks' Secured Claims. Class 3 consists of
the Banks' Secured Claims.
3.04. Class 4: Old Senior Floating Rate Note Claims and Old
Senior Fixed Rate Note Claims. Class 4 consists of all Old
Senior Floating Rate Note Claims and all Old Senior Fixed Rate
Note Claims.
3.05. Class 5: Old Subordinated Debenture Claims. Class 5
consists of all Claims of the holders of Old Subordinated
Debentures.
3.06. Class 6: General Unsecured Claims. Class 6 consists
of all Claims (including, without limitation, Employee Claims and
Trade Claims), other than Claims that are otherwise classified
hereby, Administrative Expense Claims or Priority Tax Claims.
3.07. Class 6A: Deferred Compensation Claims. Class 6A
consists of all Deferred Compensation Claims.
3.08. Class 7: Old Series B Preferred Stock. Class 7
consists of all Interests of the holders of Old Series B
Preferred Stock, and all Claims arising from recision of a
purchase or sale of such stock, or for damages arising from such
a purchase or sale.
3.09. Class 8: Old Series C Preferred Stock. Class 8
consists of all Interests of the holders of the Old Series C
Preferred Stock, and all Claims arising from recision of a
purchase or sale of such stock, or for damages arising from such
a purchase or sale.
3.10. Class 9: Old Common Stock. Class 9 consists of all
Interests of the holders of Common Stock, and all Claims arising
from recision of a purchase or sale of such stock, or for damages
arising from such a purchase or sale.
3.11. Class 10: Old Options. Class 10 consists of all
Interests of the holders of the Old Options, and all Claims
arising from recision of a purchase or sale of the Old Options,
or for damages arising from such a purchase or sale.
ARTICLE IV.
TREATMENT OF UNIMPAIRED CLASSES
4.01. Class 1 (Other Priority Claims). Each holder of an
Allowed Class 1 Claim shall be paid in full in cash the amount of
its Allowed Class 1 Claim on the later of (a) the Effective Date
and (b) the date on which such Claim becomes Allowed, unless such
holder shall agree to a different treatment of such Claim
(including, without limitation, any different treatment that may
be provided for in any documentation governing such Claim).
4.02. Class 2 (Miscellaneous Secured Claims). With respect
to each Allowed Class 2 Claim, unless the holder thereof shall
agree to a different treatment of such Claim, such holder shall
receive one of the following alternative treatments, at the
election of the Debtor made on or prior to the Effective Date:
(a) The legal, equitable and contractual rights to
which such Claim entitles the holder thereof shall be
unaltered by the Plan.
(b) Such Claim shall receive the treatment described
in section 1124(2) of the Bankruptcy Code.
(c) All collateral securing such Claim shall be
transferred and surrendered to such holder, without
representation or warranty by or recourse against the
Debtor.
With respect to any Claim which receives the treatment
described in clause "a" or "b" above, the Debtor's failure to
object to such Claim in the Chapter 11 Case shall be without
prejudice to the Debtor's right to contest or otherwise defend
against such Claim in an applicable nonbankruptcy forum when and
if such Claim is sought to be enforced by the holder thereof
after the Effective Date.
4.03. Class 6 (General Unsecured Claims). With respect to
each Allowed Class 6 Claim, unless the holder thereof shall agree
to a different treatment, such holder shall receive one of the
following alternative treatments, at the election of the Debtor
made on or prior to the Effective Date:
(a) The legal, equitable and contractual rights to
which such Claim entitles the holder thereof shall be
unaltered by the Plan.
(b) Such Claim shall receive the treatment described
in section 1124(2) of the Bankruptcy Code.
With respect to any Claim which receives the treatment
described in clause "a" or "b" above, the Debtor's failure to
object to such Claim in the Chapter 11 Case shall be without
prejudice to the Debtor's right to contest or otherwise defend
against such Claim in an applicable nonbankruptcy forum when and
if such Claim is sought to be enforced by the holder thereof
after the Effective Date.
4.04. Class 6A (Deferred Compensation Claims). With
respect to each Allowed Deferred Compensation Claim, subject to
the application of section 502(b)(7) of the Bankruptcy Code, the
legal, equitable and contractual rights to which such Claim
entitles the holder thereof shall be unaltered by the Plan.
4.05. Unimpaired Classes. By virtue of the foregoing
provisions of this Article IV, the Claims in Classes 1, 2, 6 and
6A are not impaired by the Plan. Pursuant to section 1126(f) of
the Bankruptcy Code, such Classes and each holder of a Claim in
such Classes are conclusively presumed to have accepted the Plan,
and solicitation of acceptances of holders in such Classes is not
required.
ARTICLE V.
TREATMENT OF IMPAIRED CLASSES
5.01. Class 3 (Banks' Secured Claims). On the Effective
Date, in exchange for their Claims, the holders of the Banks'
Secured Claims shall receive each of the following (and each of
the following events shall occur):
(a) All Eligible Interest Rate Contracts (as such term
is defined in the Credit Agreement) not previously assumed
by the Debtor shall be assumed by the Reorganized Debtor as
of the Effective Date, with payments to be made thereunder
in accordance with the terms thereof;
(b) All Letters of Credit (as such term is defined in
the Credit Agreement) shall be either (i) terminated by
surrender of the applicable letter of credit to the Bank
which is the issuer thereof (without any drawing having
occurred thereunder for which such issuer has not received
reimbursement in full in cash) or (ii) provided for in a
manner acceptable to the Banks;
(c) All conditions to the funding of loans under the
New Bank Credit Agreement shall have been satisfied; and
(d) The Agent (as such term is defined in the Credit
Agreement) shall receive for the benefit of the Banks (for
distribution in accordance with the Credit Agreement) both
of the following:
(i) Secured promissory notes issued by the
Reorganized Debtor under the New Bank Credit Agreement
in an aggregate principal amount of $35,000,000 secured
by all assets of the Reorganized Debtor and otherwise
in accordance with the New Bank Credit Agreement; and
(ii) An amount of cash equal to the excess of
(A) the aggregate amount of the Banks' Secured Claims
as of the Effective Date over (B) the sum of
(1) $35,000,000 less the Banks' share of the amount of
unfunded Revolving Loan commitments under the New Bank
Credit Agreement as of the Effective Date, (2) the
aggregate maximum amount then available for funding
under the Letters of Credit as of the Effective Date
(which amount shall be satisfied as provided above in
this Section 5.01) other than Letters of Credit which
are assumed or replaced with letters of credit under
the New Bank Credit Agreement, and (3) the amounts
payable under Eligible Interest Rate Contracts which
are assumed (as provided above in this Section 5.01).
5.02. Class 4 (Old Senior Floating Rate Note Claims and Old
Senior Fixed Rate Note Claims). On the Effective Date, each
holder of an Allowed Old Senior Floating Rate Note Claim and each
holder of an Allowed Old Senior Fixed Rate Note Claim shall
receive, in exchange for its Claim, AT SUCH HOLDER'S ELECTION,
(a) an amount of New Senior Floating Rate Notes equal
to 100% of such Claim, or
(b) an amount of New Senior Fixed Rate Notes equal to
100% of such Claim, or
(c) an amount of New Senior Floating Rate Notes and an
amount of New Senior Fixed Rate Notes equal, in the
aggregate, to 100% of such Claim.
Each holder of Old Senior Floating Rate Notes and each holder of
Old Senior Fixed Rate Notes as of the Ballot Record Date shall be
entitled to make the election enumerated above in this Section
5.02 by marking its Ballot completely in accordance with the
instructions thereon and returning such Ballot to the Ballot
Agent prior to the Ballot Return Date. Each such holder that
does not submit a Ballot in respect of its Old Senior Floating
Rate Notes and/or Old Senior Fixed Rate Notes, or does not mark
its Ballot in complete accordance with the instructions set forth
on such Ballot, shall be deemed conclusively to have elected
option (a) enumerated above in this Section 5.02.
FROM AND AFTER THE BALLOT RETURN DATE, THE ELECTION MADE, OR
DEEMED TO HAVE BEEN MADE, BY EACH HOLDER OF OLD SENIOR FLOATING
RATE NOTES AND EACH HOLDER OF OLD SENIOR FIXED RATE NOTES
PURSUANT TO THIS SECTION 5.02 SHALL BE BINDING UPON ANY AND ALL
SUCCESSORS, ASSIGNS AND/OR TRANSFEREES OF EACH SUCH HOLDER.
5.03. Class 5 (Old Subordinated Debenture Claims). On the
Effective Date, each holder of an Allowed Class 5 Claim shall
receive, in exchange for its Claim, subject to Section 7.18
hereof, 25.095 shares of New Common Stock for each $1,000 of
principal amount of Old Subordinated Debentures owned by such
holder. The holders of Allowed Class 5 Claims shall receive in
the aggregate 85% of the New Common Stock outstanding on the
Effective Date.
5.04. Class 7 (Old Series B Preferred Stock). No
distributions shall be made in respect of Class 7. Each Old
Equity Interest included in Class 7 shall be cancelled, and any
Claims in Class 7 shall be discharged.
5.05. Class 8 (Old Series C Preferred Stock). No
distributions shall be made in respect of Class 8. Each Old
Equity Interest included in Class 8 shall be cancelled, and any
Claims in Class 8 shall be discharged.
5.06. Class 9 (Old Common Stock). No distributions shall
be made in respect of Class 9. Each Old Equity Interest included
in Class 9 shall be cancelled, and any Claims in Class 9 shall be
discharged.
5.07. Class 10 (Old Options). No distributions shall be
made in respect of Class 10. Each Old Option shall be cancelled,
and any Claims in Class 10 shall be discharged.
5.08. Impaired Classes and Interests. By virtue of the
foregoing provisions of this Article V, Classes 3, 4, 7, 8, 9 and
10 are impaired under the Plan. Pursuant to section 1126(a) of
the Bankruptcy Code, holders in Classes 3, 4 and 5 are entitled
to vote to accept or reject the Plan. Pursuant to section
1126(g) of the Bankruptcy Code, holders in Classes 7, 8, 9 and 10
are deemed to reject the Plan.
ARTICLE VI.
NO BAR DATE; DISPUTED CLAIMS; OBJECTIONS TO CLAIMS
6.01. No Bar Date; Disputed Claims; Objections to Claims.
No bar date pursuant to Bankruptcy Rule 3003(c)(3) shall be fixed
as a deadline for the filing of proofs of Claim against the
Debtor. Only Claims that are Allowed shall be entitled to
distributions under the Plan. The Debtor reserves the right to
contest and object to any Claims (excluding the Banks' Secured
Claims), including, without limitation, those Claims that are
specifically referenced herein, are not listed in the Schedules,
are listed therein as disputed, contingent and/or unliquidated in
amount, or are listed therein at a lesser amount than asserted by
the holder of such Claim. Unless otherwise ordered by the
Bankruptcy Court, all objections to Claims (other than
Administrative Expense Claims) shall be Filed and served upon
counsel to the Debtor, counsel to the Creditors' Committee,
counsel to the Bondholder Committee and the holder of the Claim
objected to on or before the later of (a) the Effective Date and
(b) 25 days after the date (if any) on which a proof of claim is
Filed in respect of such Claim. The last day for filing
objections to Administrative Expense Claims shall be set pursuant
to an order of the Bankruptcy Court. All disputed Claims shall
be resolved by the Bankruptcy Court, except to the extent that
(y) the Debtor may otherwise elect consistent with the Plan and
the Bankruptcy Code or (z) the Bankruptcy Court may otherwise
order.
ARTICLE VII.
IMPLEMENTATION OF THE PLAN
7.01. Securities Purchase. As of the Effective Date, the
Reorganized Debtor shall, in accordance with the Plan, enter into
the Securities Purchase Agreement.
7.02. Restated Certificate of Incorporation. The
Reorganized Debtor shall be deemed to have adopted the Restated
Certificate of Incorporation on the Effective Date and shall
promptly thereafter cause the same to be filed with the Secretary
of State of the State of Delaware. Except to the extent
prohibited by the terms and provisions of the New Bank Credit
Agreement, the New Indentures and/or the Plan, after the
Effective Date, the Reorganized Debtor may amend the Restated
Certificate of Incorporation and may amend its by-laws, in
accordance with the Restated Certificate of Incorporation, such
by-laws and applicable state law.
7.03. Issuance of New Notes and New Common Stock. On the
Effective Date, the Reorganized Debtor shall, in accordance with
the Plan, (a) enter into the New Indentures and issue the New
Notes thereunder to the holders of the Allowed Old Senior
Floating Rate Note Claims and the Allowed Old Senior Fixed Rate
Note Claims and (b) issue for distribution or sale the New Common
Stock to the holders of the Allowed Class 5 Claims and GEI,
respectively.
7.04. New Management Services Agreement. As of the
Effective Date, the Reorganized Debtor shall, in accordance with
the Plan, enter into the New Management Services Agreement.
7.05. New Bank Credit Agreement. On the Effective Date,
the Reorganized Debtor shall, in accordance with the Plan, enter
into the New Bank Credit Agreement.
7.06. Effectiveness of Securities, Instruments and
Agreements. On the Effective Date, all securities, instruments
and agreements entered into pursuant to the Plan, including,
without limitation, (a) the New Indentures, (b) the New Notes,
(c) the New Common Stock, (d) the New Management Services
Agreement, (e) the Securities Purchase Agreement, (f) the New
Bank Credit Agreement and (g) any security, instrument or
agreement entered into in connection with any of the foregoing
shall become effective and binding in accordance with their
respective terms and conditions upon the parties thereto and
shall be deemed to become effective simultaneously.
7.07. Cancellation of Credit Agreement. On the Effective
Date, except as otherwise provided herein or as contemplated by
the New Bank Credit Agreement, the Credit Agreement shall be
deemed cancelled and terminated, and the obligations of the
Debtor relating to, arising under, in respect of or in connection
with the Credit Agreement shall be discharged; provided, however,
that except as otherwise provided herein, notes and other
evidences of the Banks' Secured Claims shall, effective upon the
Effective Date, represent the right to participate in the
distributions contemplated by the Plan in respect of the Banks'
Secured Claims.
7.08. Cancellation of Securities, Instruments and
Agreements Relating to Impaired Claims and Interests. On the
Effective Date, except as otherwise provided herein, all
securities, instruments and agreements governing any Claims and
Interests impaired hereby, including, without limitation, (a) the
Old Equity Interests, (b) the Old Warrant Agreements, (c) the Old
Notes, (d) the Old Indentures, (e) the Old Stock Option Plan,
(f) the Old Stockholders' Agreement, (g) the Old Management
Services Agreements and (h) any security, instrument or agreement
entered into in connection with any of the foregoing, in each
case, shall be deemed cancelled and terminated, and the
obligations of the Debtor relating to, arising under, in respect
of or in connection with such securities, instruments and
agreements shall be discharged; provided, however, that except as
otherwise provided herein, notes and other evidences of Claims
shall, effective upon the Effective Date, represent the right to
participate, to the extent such Claims are Allowed, in the
distributions contemplated by the Plan.
7.09. Waiver of Subordination. The distributions under the
Plan take into account the relative priority of each class in
connection with any contractual subordination provisions relating
thereto. Accordingly, the distributions under this Plan shall
not be subject to levy, garnishment, attachment or other legal
process by any holder (a "Senior Creditor") of a Claim or
Interest purporting to be entitled to the benefits of such
contractual subordination. On the Effective Date, all Senior
Creditors shall be deemed to have waived any and all contractual
subordination rights which they may have with respect to such
distribution, and shall be permanently enjoined from enforcing or
attempting to enforce any such rights with respect to the
distributions under the Plan.
7.10. Surrender of Securities. Each holder of a promissory
note or other instrument evidencing a Claim impaired hereby shall
surrender the same to the Debtor or the Reorganized Debtor, and
the Reorganized Debtor shall distribute or shall cause to be
distributed to the holders thereof the appropriate distribution
of property hereunder. No distribution of property hereunder
shall be made to or on behalf of any such holder unless and until
such promissory note or other instrument is received by the
Debtor or the Reorganized Debtor, or the unavailability of such
note or other instrument is established to the satisfaction of
the Debtor or the Reorganized Debtor. Any such holder that fails
to surrender or cause to be surrendered such promissory note or
other instrument, or to execute and deliver an affidavit of loss
and indemnity satisfactory to the Debtor or the Reorganized
Debtor, and, in the event that the Debtor or the Reorganized
Debtor so requests with respect to the Old Notes, fails to
furnish a bond in form and substance (including, without
limitation, with respect to amount) reasonably satisfactory to
the Debtor or the Reorganized Debtor, within two years after the
Confirmation Date, shall be deemed to have forfeited all Claims
against the Debtor represented by such note or other instrument
and shall not participate in any distribution hereunder in
respect of such note or other instrument and all property in
respect of such forfeited distribution, including (if applicable)
interest accrued thereon, shall revert to the Reorganized Debtor.
Notwithstanding the foregoing, all Claims shall be discharged and
all Interests shall be terminated by this Plan to the extent
provided herein regardless of whether and when any surrender,
indemnity or bond required by this Section is provided, and
regardless of whether the Reorganized Debtor makes a distribution
hereunder in the absence of compliance by any holder of a Claim
with the requirements of this Section. The Debtor or the
Reorganized Debtor may waive the requirements of this Section.
7.11. Releases. (a) On the Effective Date, the Reorganized
Debtor, on its own behalf and as representative of the Debtor's
estate, releases unconditionally, and hereby is deemed to release
unconditionally (i) each of the Debtor's officers, directors,
shareholders, employees, consultants, attorneys, accountants and
other representatives, (ii) the Creditors' Committee and, solely
in their capacity as members or representatives of the Creditors'
Committee, each member, consultant, attorney, accountant or other
representative of the Creditors' Committee, (iii) the Bondholder
Committee and, solely in their capacity as members or
representatives of the Bondholder Committee, each member,
consultant, attorney, accountant or other representative of the
Bondholder Committee, (iv) the Banks and, solely in their
capacity as representatives of the respective Banks, each of the
Banks' respective officers, directors, employees, consultants,
attorneys, accountants and other representatives, and
(v) NationsBank of Florida, N.A., as trustee under the Old Senior
Floating Rate Note Indenture (the Entities specified in clauses
(i), (ii), (iii), (iv) and (v) are referred to collectively as,
the "Releasees"), from any and all claims, obligations, suits,
judgments, damages, rights, causes of action and liabilities
whatsoever, whether known or unknown, foreseen or unforeseen,
existing or hereafter arising, in law, equity or otherwise, based
in whole or in part upon any act or omission, transaction, event
or other occurrence taking place on or prior to the Effective
Date in any way relating to the Releasees, the Debtor, the
Chapter 11 Case or the Plan.
(b) On the Effective Date, each holder of a Claim (i) who
has accepted the Plan, (ii) whose Claim is in a Class that has
accepted or is deemed to have accepted the Plan pursuant to
section 1126 of the Bankruptcy Code or (iii) who may be entitled
to receive a distribution of property pursuant to the Plan, shall
be deemed to have unconditionally released the Releasees, from
any and all rights, claims, causes of action, obligations, suits,
judgments, damages and liabilities whatsoever which any such
holder may be entitled to assert, whether known or unknown,
foreseen or unforeseen, existing or hereafter arising, in law,
equity or otherwise, based in whole or in part upon any act or
omission, transaction, event or other occurrence taking place on
or before the Effective Date in any way relating to the Debtor,
the Chapter 11 Case or the Plan, provided however, that the
foregoing shall not apply to all rights, claims and obligations
created by or arising under the Plan.
(c) Notwithstanding the foregoing, if and to the extent
that the Bankruptcy Court concludes that the Plan cannot be
confirmed with any portion of the foregoing releases, then the
Plan may be confirmed with that portion excised so as to give
effect as much as possible to the foregoing releases without
precluding confirmation of the Plan.
(d) All amounts required to be held in a special account
pursuant to Section 613 of the Old Senior Floating Rate Note
Indenture are hereby apportioned to NationsBank of Florida, N.A.,
in its capacity as a Bank.
7.12. Management of the Reorganized Debtor. On the
Effective Date, the operation of the Reorganized Debtor shall
become the general responsibility of the Post-Restructuring
Board, in accordance with applicable law. However, in the event
that any such officer or director is unwilling or unable to take
office at that time, the resulting vacancy shall be filled by
action of the Post-Restructuring Board.
7.13. Setoffs. The Debtor may, but shall not be required
to, set off against any Claim and the distributions to be made
pursuant to the Plan in respect of such Claim, any claims of any
nature whatsoever which the Debtor may have against the holder of
such Claim, but neither the failure to do so nor the allowance of
any Claim hereunder shall constitute a waiver or release of any
such claim the Debtor may have against such holder.
7.14. Distribution of Unclaimed Property. Any distribution
of property under the Plan which is unclaimed after two years
following the Effective Date shall irrevocably revert to the
Reorganized Debtor.
7.15. Saturday, Sunday or Legal Holiday. If any payment or
act under the Plan is required to be made or performed on a date
that is not a Business Day, then the making of such payment or
the performance of such act may be completed on the next
succeeding Business Day, but shall be deemed to have been
completed as of the required date.
7.16. Corporate Action. Upon entry of the Confirmation
Order by the Clerk of the Bankruptcy Court, all actions
contemplated by the Plan shall be authorized and approved in all
respects (subject to the provisions of the Plan), including,
without limitation, the following: (a) the adoption and filing
with the Secretary of State of the State of Delaware of the
Restated Certificate of Incorporation, (b) the issuance by the
Reorganized Debtor of the New Notes and the New Common Stock, and
(c) the execution, delivery and performance of the New
Indentures, the New Management Services Agreement, the Securities
Purchase Agreement, the New Bank Credit Agreement and all
documents and agreements relating to any of the foregoing. All
matters provided for under the Plan involving the corporate
structure of the Debtor and/or the Reorganized Debtor in
connection with the Plan, and any corporate action required by
the Debtor and/or the Reorganized Debtor in connection with the
Plan, shall be deemed to have occurred and shall be in effect
pursuant to section 303 of the Delaware General Corporation Law
and the Bankruptcy Code, without any requirement of further
action by the stockholders or directors of the Debtor and/or the
Reorganized Debtor. On the Effective Date, the appropriate
officers of the Reorganized Debtor and members of the Post-
Restructuring Board are authorized and directed to execute and
deliver the agreements, documents and instruments contemplated by
the Plan and the Disclosure Statement in the name of and on
behalf of the Reorganized Debtor.
7.17. Retiree Benefits. On and after the Effective Date,
to the extent required by section 1129(a)(13) of the Bankruptcy
Code, the Reorganized Debtor shall continue to pay all retiree
benefits (if any), as that term is defined in section 1114 of the
Bankruptcy Code, maintained or established by the Debtor prior to
the Effective Date, without prejudice to the Reorganized Debtor's
rights under applicable non-bankruptcy law to modify, amend or
terminate the foregoing arrangements.
7.18. Fractional Shares. The New Common Stock shall not be
issued in fractional shares. If, but for this Section, an Entity
would be entitled to receive a fractional share, then such Entity
shall be issued in lieu thereof either no share (if such fraction
is less than one-half) or one whole share (if such fraction is
equal to or greater than one-half).
7.19. Timing of Distributions. Notwithstanding anything to
the contrary herein, (a) any distribution required by the Plan to
be made on the Effective Date in respect of a Claim shall be made
as soon as practicable after (but in any event within 30 days of)
the later of (i) the Effective Date and (ii) the date on which
such Claim becomes Allowed and any other conditions to
distribution with respect to such Claim shall have been
satisfied, and (b) any distribution required by the Plan to be
made on a date subsequent to the Effective Date shall be made on
the later of (i) such date and (ii) as soon as practicable after
(but in any event within 30 days of) the date on which the
pertinent Claim becomes Allowed and any other conditions to
distribution with respect to such Claim shall have been
satisfied; provided, however, that this Section 7.19 shall not
apply to the Banks' Secured Claims and any Claims arising under
the DIP Facility.
7.20. Final Order. Any requirement in the Plan for a Final
Order may be waived by the Debtor, with the consent of the
Bondholder Committee, or, in the event that the Bondholder
Committee is reconstituted as the Creditors' Committee, the
Creditors' Committee, upon written notice to the Bankruptcy
Court; provided, however, that nothing contained herein shall
prejudice the right of any party in interest to seek a stay
pending appeal with respect to such Final Order.
7.21. Ballot Record Date; Distribution Record Date. The
Reorganized Debtor shall distribute, or cause to be distributed,
all distributions of property to be made pursuant to the Plan to
the record holders of Allowed Old Senior Floating Rate Note
Claims, Allowed Old Senior Fixed Rate Note Claims and Allowed
Class 5 Claims as of the Ballot Record Date, unless, prior to the
Distribution Record Date, the holder of any such Claim furnishes
(or causes its transferee to furnish) the Debtor, or its agent,
with sufficient evidence (in the Debtor's or its agent's sole and
absolute discretion) of the transfer of such Claim, in which
event the Reorganized Debtor shall distribute, or cause to be
distributed, all distributions of property to the holder of such
Claim as of the Distribution Record Date. As of the close of
business on the Distribution Record Date, the transfer ledgers
with respect to the Old Notes shall be closed and the Debtor, the
Reorganized Debtor and the indenture trustees with respect to the
Old Indentures shall have no obligation to recognize any transfer
of the Old Notes occurring thereafter.
ARTICLE VIII.
EXECUTORY CONTRACTS AND UNEXPIRED LEASES
8.01. Generally. Effective on and as of the Effective
Date, all executory contracts and unexpired leases that exist
between the Debtor and any Entity are hereby specifically
assumed, except for any executory contracts and unexpired leases
that have been specifically rejected by the Debtor with the
approval of the Bankruptcy Court on or before the Effective Date
or in respect of which a motion for rejection has been Filed on
or before the Effective Date.
8.02. Assumption. Entry of the Confirmation Order by the
Clerk of the Bankruptcy Court shall constitute approval of all
executory contracts and unexpired leases to be assumed by the
Debtor in accordance with Section 8.01 hereof pursuant to section
365(a) of the Bankruptcy Code.
8.03. Rejection. Claims created by or arising in
connection with the rejection of executory contracts and
unexpired leases of the Debtor must be Filed no later than 20
days after the entry of a Final Order authorizing such rejection.
Any such Claims not Filed within such time shall be forever
barred from assertion against the Debtor, the Reorganized Debtor
and their property and estate. Each Claim resulting from such
rejection shall constitute a Class 2 Claim if secured or a Class
6 Claim if unsecured.
8.04. Officers' and Directors' Indemnification Rights.
Notwithstanding any other provisions of the Plan, the obligations
of the Debtor to indemnify its or its Affiliates' (if any)
directors, officers and employees as of the Petition Date against
any obligations, liabilities, costs or expenses pursuant to the
certificate of incorporation or by-laws of the Debtor, applicable
state law or specific agreement, or any combination of the
foregoing, shall survive confirmation of the Plan, remain
unaffected thereby, and not be discharged, regardless of whether
indemnification is owed in connection with an event occurring
prior to, upon or subsequent to the commencement of the Chapter
11 Case.
8.05. Compensation and Benefit Programs. All employee
compensation and benefit plans, policies and programs of the
Debtor applicable generally to its employees as in effect on the
Effective Date, including, without limitation, all savings plans,
retirement plans, health care plans, disability plans, severance
benefit plans, incentive plans and life, accidental death and
dismemberment insurance plans, shall continue in full force and
effect, without prejudice to the Reorganized Debtor's rights
under applicable non-bankruptcy law to modify, amend or terminate
any of the foregoing arrangements.
ARTICLE IX.
CONDITIONS PRECEDENT
9.01. Conditions to Effective Date. The Plan shall not
become effective unless and until the following conditions shall
have been satisfied or waived pursuant to Section 9.02 hereof:
(a) The Confirmation Order shall have become a Final
Order.
(b) The New Indentures and all documents contemplated
by such documents to be executed simultaneously therewith
shall have been executed by the respective parties thereto
and all of the conditions precedent to the effectiveness of
such documents and agreements (other than that the Plan be
effective) shall have been satisfied in full or duly waived.
(c) The New Bank Credit Agreement shall have been
executed by the respective parties thereto, all of the
conditions precedent to the effectiveness of the New Bank
Credit Agreement (other than that the Plan be effective)
shall have been satisfied in full or duly waived, and the
Bondholder Committee, or, in the event that the Bondholder
Committee is reconstituted as the Creditors' Committee, the
Creditors' Committee, shall have delivered to the Debtor a
writing indicating its approval of the terms and provisions
of the New Bank Credit Agreement.
(d) The Debtor shall have received $10 million from
GEI in accordance with the Securities Purchase Agreement.
(e) The Debtor shall have concurrently satisfied all
of its obligations under the DIP Facility and the DIP
Facility shall have been concurrently cancelled.
(f) The fees to be paid by the Debtor or the
Reorganized Debtor to Donaldson, Lufkin & Jenrette
Securities Corporation, as financial advisor to the Debtor
with respect to the Debtor's restructuring, shall have been
approved by the Bondholder Committee (or, in the event the
Bondholder Committee is reconstituted as the Creditors'
Committee, the Creditors' Committee).
(g) All other actions required by Article VII and
Section 12.01 hereof to occur on or before the Effective
Date shall have occurred.
9.02. Waiver of Conditions. The Debtor, with the consent of
the Bondholder Committee, or, in the event that the Bondholder
Committee is reconstituted as the Creditors' Committee, the
Creditors' Committee, may waive any of the conditions set forth
in Section 9.01 hereof, with the exception of Sections 9.01(c)
and 9.01(e), the waiver of which, in addition, will require the
consent of the Banks.
9.03. Notice to Bankruptcy Court. The Debtor shall notify
the Bankruptcy Court in writing promptly after the Effective Date
that the Plan shall have become effective.
ARTICLE X.
MODIFICATION, REVOCATION OR WITHDRAWAL OF THE PLAN
10.01. Modification of Plan. The Debtor, with the consent
of the Banks and the Bondholder Committee, or, in the event that
the Bondholder Committee is reconstituted as the Creditors'
Committee, the Creditors' Committee, may alter, amend or modify
the Plan pursuant to section 1127 of the Bankruptcy Code at any
time prior to the time that the Bankruptcy Court has signed the
Confirmation Order. After such time and prior to the substantial
consummation of the Plan, the Debtor may, so long as the
treatment of holders of Claims and Interests under the Plan is
not adversely affected, institute proceedings in Bankruptcy Court
to remedy any defect or omission or to reconcile any
inconsistencies in the Plan, the Disclosure Statement or the
Confirmation Order and any other matters as may be necessary to
carry out the purposes and effects of the Plan; provided,
however, prior notice of such proceedings shall be served in
accordance with Bankruptcy Rule 2002.
10.02. Revocation or Withdrawal of Plan.
(a) Right to Revoke. The Debtor reserves the right to
revoke or withdraw the Plan at any time prior to the Confirmation
Date.
(b) Effect of Withdrawal or Revocation. If the Debtor
revokes or withdraws the Plan prior to the Confirmation Date,
then the Plan shall be deemed null and void. In such event,
nothing contained herein shall be deemed to constitute a waiver
or release of any claims by or against the Debtor or any other
Entity or to prejudice in any manner the rights of the Debtor or
any Entity in any further proceedings involving the Debtor.
10.03. Nonconsensual Confirmation. The Debtor shall
request that the Bankruptcy Court confirm the Plan pursuant to
section 1129(b) of the Bankruptcy Code with respect to Classes 7,
8, 9 and 10, on the basis that the Plan is fair and equitable and
does not discriminate unfairly with respect to such Classes.
ARTICLE XI.
RETENTION OF JURISDICTION
11.01. Jurisdiction of Bankruptcy Court.
(a) Following the Effective Date, the Bankruptcy Court will
retain exclusive jurisdiction of the Chapter 11 Case for the
following purposes:
(i) To hear and determine any pending applications for
the rejection of executory contracts or unexpired leases,
and the allowance of Claims resulting therefrom.
(ii) To determine any adversary proceedings,
applications, contested matters and other litigated matters
pending on the Effective Date.
(iii) To ensure that distributions to holders of
Allowed Claims are accomplished as provided herein.
(iv) To hear and determine object-ions to or requests
for estimation of Claims, including any objections to the
classification of any Claim, and to allow, disallow and/or
estimate any Claim, in whole or in part.
(v) To enter and implement such orders as may be
appropriate in the event the Confirmation Order is for any
reason stayed, revoked, modified or vacated.
(vi) To issue any appropriate orders in aid of
execution of the Plan or to enforce the Confirmation Order
and/or the discharge, or the effect of such discharge,
provided to the Debtor.
(vii) To hear and determine any ap-plications to
modify the Plan, to cure any defect or omission or to
reconcile any inconsistency in the Plan or in any order of
the Bankruptcy Court, including, without limitation, the
Confirmation Order.
(viii) To hear and determine all ap-plications for
compensation and reimbursement of expenses of professionals
of the Debtor and the Creditors' Committee (and, if
applicable, the Bondholder Committee), and for reimbursement
of expenses of members of the Creditors' Committee (and if
applicable, the Bondholder Committee) under sections 330,
331, 503(b) and/or 1103 of the Bankruptcy Code.
(ix) To hear and determine disputes arising in
connection with the interpretation, implementation or
enforcement of the Plan; provided, however, that nothing
herein shall be construed to vest in the Bankruptcy Court
jurisdiction to hear and determine disputes arising in
connection with the interpretation, implementation or
enforcement of the instruments and securities being issued
under the Plan.
(x) To hear and determine other issues presented or
arising under the Plan.
(xi) To hear and determine any ot-her matters related
hereto and not inconsistent with chapter 11 of the
Bankruptcy Code.
(xii) To enter a final decree clos-ing the Chapter 11
Case.
(xiii) To hear and determine the allowance of any
Deferred Compensation Claim which is asserted against the
Debtor prior to the Effective Date or the Reorganized Debtor
thereafter.
(b) Following the Effective Date, the Bankruptcy Court will
retain non-exclusive jurisdiction of the Chapter 11 Case for the
following purposes:
(i) To recover all assets of the Debtor and property
of the estate, wherever located.
(ii) To hear and determine any mo-tions or contested
matters involving taxes, tax refunds, tax attributes and tax
benefits and similar or related matters with respect to the
Debtor or its estate arising prior to the Effective Date or
relating to the period of administration of the Chapter 11
Case, including, without limitation, matters concerning
state, local and federal taxes in accordance with sections
346, 505 and 1146 of the Bankruptcy Code.
(iii) To hear any other matter not inconsistent with
the Bankruptcy Code.
11.02. Failure of Bankruptcy Court to Exercise
Jurisdiction. If the Bankruptcy Court abstains from exercising
or declines to exercise jurisdiction over any matter arising
under, arising in or related to the Chapter 11 Case, including
with respect to the matters set forth above in Sections 11.01(a)
and (b) hereof, this Article shall not prohibit or limit the
exercise of jurisdiction by any other court having competent
jurisdiction with respect to such subject matter.
ARTICLE XII.
MISCELLANEOUS PROVISIONS
12.01. Payment of Statutory Fees. All fees payable
pursuant to section 1930 of title 28 of the United States Code,
as determined by the Bankruptcy Court at the hearing pursuant to
section 1128 of the Bankruptcy Code, shall be paid on or before
the Effective Date.
12.02. Shelf Registration. Within four months after the
Effective Date, or such longer time as may be required to prepare
the necessary financial statements, the Reorganized Debtor shall
file, at its expense, the Shelf Registration Statement. The
Reorganized Debtor shall use its best efforts to have the Shelf
Registration Statement declared effective as soon as practicable
after such filing and to keep the Shelf Registration Statement
continuously effective until the third anniversary date of the
effective date thereof. No securities other than the New Common
Stock shall be included in the Shelf Registration Statement
unless the holders of a majority of the outstanding New Common
Stock consent to such inclusion. The Reorganized Debtor shall
also, if necessary, supplement or make amendments to the Shelf
Registration Statement, if required.
12.03. Discharge of Debtor. Except as otherwise expressly
provided herein, the confirmation of the Plan shall, provided
that the Effective Date shall have occurred, discharge all Claims
and terminate all Interests, to the fullest extent authorized or
provided for by the Bankruptcy Code, including, without
limitation, to the extent authorized or provided for by sections
524 and 1141 thereof.
12.04. Injunction. Except as otherwise expressly provided
herein, the entry of the Confirmation Order shall, provided that
the Effective Date shall have occurred, permanently enjoin all
Entities that have held, currently hold or may hold a Claim, or
other debt or liability that is discharged pursuant to the Plan
or who have held, currently hold or may hold an Interest that is
terminated pursuant to the Plan from taking any of the following
actions in respect of such discharged Claim, debt or liability or
such terminated Interest: (a) commencing, conducting or
continuing in any manner, directly or indirectly, any suit,
action or other proceeding of any kind against the Debtor, the
Reorganized Debtor or their property; (b) enforcing, levying,
attaching, collecting or otherwise recovering in any manner or by
any means, whether directly or indirectly, any judgment, award,
decree or order against the Debtor, the Reorganized Debtor or
their property; (c) creating, perfecting or enforcing in any
manner, directly or indirectly, any lien or encumbrance of any
kind against the Debtor, the Reorganized Debtor or their
property; (d) asserting any setoff, right of subrogation or
recoupment of any kind, directly or indirectly, against any debt,
liability or obligation due to the Debtor, the Reorganized Debtor
or their property; and (e) proceeding in any manner in any place
whatsoever that does not conform to or comply with or is
inconsistent with the provisions of the Plan.
12.05. Revesting. Except as otherwise expressly provided
herein, on the Effective Date, all property and assets of the
estate of the Debtor shall revest in the Reorganized Debtor, free
and clear of all Claims, liens, encumbrances, charges, Interests
and other interests of creditors and equity security holders
arising on or before the Effective Date except as otherwise
provided in the New Bank Credit Agreement, and the Reorganized
Debtor may operate its business, from and after the Effective
Date, free of any restrictions imposed by the Bankruptcy Code or
the Bankruptcy Court.
12.06. Exculpation. Neither the Reorganized Debtor, the
Banks, the Creditors' Committee, nor the Bondholder Committee,
nor any of their respective members, officers, directors,
shareholders, employees, agents, attorneys, accountants or other
advisors, shall have or incur any liability to any holder of a
Claim or Interest for any act or failure to act in connection
with, or arising out of, the pursuit of confirmation of the Plan,
the consummation of the Plan or the administration of the Plan or
the property to be distributed under the Plan, except for any act
or failure to act that constitutes willful misconduct or reck-
less-ness as determined pursuant to a Final Order; and in all
respects, such Entities (a) shall be entitled to rely upon the
advice of counsel with respect to their duties and responsibili-
ties under the Plan, and shall be fully protected from liability
in acting or in refraining from action in accordance with such
advice and (b) shall be fully protected from liability with
respect to any act or failure to act that is approved or ratified
by the Bankruptcy Court.
12.07. Rights of Action. Any rights or causes of action
(including, without limitation, any and all avoidance actions)
accruing to the Debtor shall remain assets of the Reorganized
Debtor. The Reorganized Debtor may pursue such rights of action,
as appropriate, in accordance with what is in its best interests
and for its benefit.
12.08. Creditors' Committee. The appointment of each
official statutory committee appointed in the Chapter 11 Case
shall terminate on the Effective Date.
12.09. Governing Law. Except to the extent the Bankruptcy
Code, the Bankruptcy Rules or other federal laws are applicable,
the laws of the State of Delaware shall govern the construction
and implementation of the Plan and all rights and obligations
arising under the Plan.
12.10. Withholding and Reporting Requirements. In
connection with the Plan and all instruments issued in connection
therewith and distributions thereon, the Debtor and the
Reorganized Debtor shall comply with all withholding, reporting,
certification and information requirements imposed by any
federal, state, local or foreign taxing authority and all
distributions hereunder shall, to the extent applicable, be
subject to any such withholding, reporting, certification and
information requirements. Entities entitled to receive
distributions hereunder shall, as a condition to receiving such
distributions, provide such information and take such steps as
the Reorganized Debtor may reasonably require to ensure
compliance with such withholding and reporting requirements, and
to enable the Reorganized Debtor to obtain the certifications and
information as may be necessary or appropriate to satisfy the
provisions of any tax law.
12.11. Time. Unless otherwise specified herein, in
computing any period of time prescribed or allowed by the Plan,
the day of the act or event from which the designated period
begins to run shall not be included. The last day of the period
so computed shall be included, unless it is not a Business Day,
in which event the period runs until the end of the next
succeeding day which is a Business Day.
12.12. Section 1146 Exemption. Pursuant to section 1146(c)
of the Bankruptcy Code, (a) the issuance, transfer or exchange of
any security under the Plan or the making or delivery of any
instrument of transfer pursuant to, in implementation of, or as
contemplated by the Plan, or the revesting, transfer or sale of
any real or personal property of the Debtor pursuant to, in
implementation of, or as contemplated by the Plan, (b) the
making, delivery, creation, assignment, amendment or recording of
any note, line of credit or other obligation for the payment of
money or any mortgage, deed of trust or other security interest
under, in furtherance of, or in connection with the Plan, the
issuance, renewal, modification or securing of indebtedness by
such means or by other means, the borrowing, repayment and re-
borrowing of sums thereunder and the making of any future
advances thereunder, and (c) the making, delivery or recording of
any deed or other instrument of transfer under, in furtherance
of, or in connection with, the Plan, including, without
limitation, the Confirmation Order shall not be subject to any
document recording tax, stamp tax, conveyance fee, recurring or
non-recurring intangibles or other similar tax, mortgage tax,
real estate transfer tax, mortgage recording tax or other similar
tax or governmental assessment. Consistent with the foregoing,
each recorder of deeds or similar official for any county, city
or governmental unit in which any instrument hereunder is to be
recorded shall, pursuant to the Confirmation Order, be ordered
and directed to accept such instrument, without requiring the
payment of any documentary stamp tax, deed stamps, stamp tax,
transfer tax, intangible tax or similar tax.
12.13. Severability. In the event that any provision of
the Plan is determined to be unenforceable, such determination
shall not limit or affect the enforceability and operative effect
of any other provisions of the Plan. To the extent that any
provision of the Plan would, by its inclusion in the Plan,
prevent or preclude the Bankruptcy Court from entering the
Confirmation Order, the Bankruptcy Court, on the request of the
Debtor, may modify or amend such provision, in whole or in part
as necessary to cure any defect or remove any impediment to the
confirmation of the Plan existing by reason of such provision;
provided, however, that such modification shall not be effected
except in compliance with Section 10.01 of the Plan.
12.14. Binding Effect. The provisions of the Plan shall
bind all holders of Claims and Interests, whether or not they
have accepted the Plan.
12.15. Plan Controls. In the event and to the extent that
any provision of the Plan is inconsistent with the provisions of
the Disclosure Statement, or any other instrument or agreement
contemplated to be executed pursuant to the Plan, the provisions
of the Plan shall control and take precedence.
12.16. Bondholder Committee. In the event that the
Bondholder Committee is not reconstituted as the Creditors'
Committee, the Debtor shall, subject to the approval of the
Bankruptcy Court, compensate and reimburse the expenses of the
professionals and members of the Bondholder Committee.
Dated: Wilmington, Delaware
December 12, 1994
Respectfully submitted,
KASH N' KARRY FOOD STORES, INC.
Debtor and Debtor-in-Possession
By__________________________________
Kramer, Levin, Naftalis, Young, Conaway, Stargatt
Nessen, Kamin & Frankel & Taylor
Counsel to the Debtor Counsel to the Debtor
and Debtor-in-Possession and Debtor-in-Possession
919 Third Avenue 11th Floor -- Rodney Square
New York, New York 10022 P.O. Box 391
Wilmington, Delaware 19899