IN THE UNITED STATES BANKRUPTCY COURT
FOR THE EASTERN DISTRICT OF LOUISIANA
In re )
)
CRESCENT CITY CAPITAL ) Case No. 95-12735 (TMB)
DEVELOPMENT CORPORATION, )
) (Chapter 11)
Debtor. )
SECOND AMENDED CHAPTER 11 PLAN OF REORGANIZATION
OF CRESCENT CITY CAPITAL DEVELOPMENT CORPORATION
BRONFIN & HELLER, LLC
Jan M. Hayden (La. Bar #6672)
Robyn J. Spalter (La. Bar #21116)
650 Poydras Street, Suite 2500
New Orleans, Louisiana 70130-
6101
(504) 568-1888
Attorneys for Debtor
Dated: March 15, 1996
IN THE UNITED STATES BANKRUPTCY COURT
FOR THE EASTERN DISTRICT OF LOUISIANA
In re )
)
CRESCENT CITY CAPITAL ) Case No. 95-12735 (TMB)
DEVELOPMENT CORPORATION, )
) (Chapter 11)
Debtor. )
SECOND AMENDED CHAPTER 11 PLAN OF REORGANIZATION
OF CRESCENT CITY CAPITAL DEVELOPMENT CORPORATION
The Debtor, Crescent City Capital Development Corporation ("Debtor" or
"Crescent City") proposes the following plan of reorganization pursuant to
chapter 11 of the Bankruptcy Code. This plan amends and supersedes all
prior plans proposed by the Debtor in this case.
ARTICLE I
DEFINITIONS
A. Defined Terms. As used herein, all terms shall have the meanings as
defined in the United States Bankruptcy Code except as specifically modified
herein or if such meaning shall be wholly inconsistent with the use of such
term in this plan. The following terms shall have the respective meanings
specified below (such meaning to be equally applicable to both the singular
and the plural, and masculine and feminine forms of the terms defined):
1.1. Administrative Reserve means the reserve to be established and
maintained by Liquidating Trust in a segregated interest-bearing account
with a major money center bank into which Liquidating Trust will, from time
to time, deposit Cash to, among other things, fund the operating expenses of
Liquidating Trust, as provided in Article VI(A) of the Plan.
1.2. Allowance Date means the date on which a Claim becomes an Allowed
Claim.
1.3. Amended By-Laws means the by-laws of Reorganized Crescent City, as
amended and restated as of the Effective Date, which shall be a Plan
Document.
1.4. Amended Certificate of Incorporation means the certificate of
incorporation of Reorganized Crescent City, as amended and restated as of
the Effective Date, which shall be a Plan Document.
1.5. Avoidance Action Recoveries means any recoveries by the Debtor or
Liquidating Trust of money, property, or other value of any kind whatsoever
(including reduction or disallowance of a claim amount), on account of
rights of recovery held by the Debtor under 11 U.S.C. Section 547 and
applies to rights of recovery of transfers made directly by any affiliates
of the debtor, including but not limited to River City Joint Venture.
1.6. Avoidance Action Rights means any rights of recovery by the Debtor or
Liquidating Trust of money, property, or other value of any kind whatsoever
(including reduction or disallowance of a claim amount), on account of
rights of recovery, held by Debtor, under 11 U.S.C. Section 547 and applies
to rights of recovery of preferential transfers made directly by the debtor
and by any affiliate of the debtor, including but not limited to River City
Joint Venture.
1.7. Bally & IGT Claims means all Claims of Bally Gaming, Inc. and
International Game Technology Corp. or their respective successors, assigns,
affiliates or agents arising in connection with the acquisition by the
Debtor of certain slot machines and other coin-operated gaming devices to be
operated on the Riverboat.
1.8. Bankruptcy Court means the United States Bankruptcy Court for the
Eastern District of Louisiana having jurisdiction over the Reorganization
Case and, to the extent of any reference made pursuant to 28 U.S.C. Sec.
157, the unit of such District Court pursuant to 28 U.S.C. Sec. 151.
1.9. Bankruptcy Case means that case entitled In re Crescent City Capital
Development Corporation currently pending in the Eastern District Court of
Louisiana and bearing case no. 95-12735(TMB).
1.10. Bondholder means the holder of a Secured Note or, in the alternative,
the duly authorized agent of such holder.
1.11. Bondholder Claim means the claim filed by the Indenture Trustee, on
behalf of all Bondholders, for all amounts due under the Debtor's guarantee
of amounts due under the Indenture, which Claim shall, upon the Effective
Date, be deemed an Allowed Claim for $142 million.
1.12. Business Day means any day other than Saturday, Sunday or "legal
holiday" as such term is defined in Bankruptcy Rule 9006(a).
1.13. Cash means lawful currency of the United States of America.
1.14. Cash Distribution Date means (a) the forty fifth (45th) day after the
Effective Date, and (b) the twentieth (20th) day after the end of the first
full fiscal quarter after the Effective Date and the twentieth (20th) day
after the end of each fiscal quarter thereafter, subject, however, to the
limitations set forth in Article VIII(A)(4) and any other provisions of the
Plan.
1.15. CGII means Capital Gaming International, Inc., a New Jersey
corporation and the Debtor's parent corporation.
1.16. CGII Claim means all Claims (other than DIP Financing Claims or other
Administrative Claims) against the Debtor held by CGII.
1.17. Closing means the closing of the transaction contemplated by the
Magic Agreement.
1.18. Commencement Date means July 26, 1995, the date on which an
involuntary Reorganization Case was commenced against the Debtor.
1.19. Confirmation Date means the date on which the Clerk of the Bankruptcy
Court enters the Confirmation Order on its docket.
1.20. Convenience Claim means any General Unsecured Claim against the
Debtor that is equal to or less than $5,000, or those Claims in excess of
$5,000 as to which the holder thereof elects, in writing on its ballot to
accept or reject the Plan or otherwise in writing on or before the Effective
Date, to reduce such Claim to $5,000 in accordance with Article III(E)(Class
3A)(4) concerning treatment of General Unsecured Claims. For purposes of
defining a Convenience Claim and qualifying for the treatment afforded
holders of Convenience Claims, all General Unsecured Claims of a single
holder shall be aggregated, deemed, and treated as a single Claim; provided,
however, those holders of General Unsecured Claims who acquired such General
Unsecured Claims from different entities shall have their General Unsecured
Claims aggregated only to the extent such Claims would have been aggregated
in the hands of the original holder.
1.21. Creditors' Committee means the Statutory Committee of Unsecured
Creditors appointed in the Bankruptcy Case pursuant to Section 1102(a) of
the Bankruptcy Code, as presently or hereafter constituted.
1.22. Debtor means Crescent City Capital Development Corp., a Louisiana
corporation.
1.23. DIP Financing Claims means all Administrative Claims arising in
connection with money borrowed or credit incurred by the Debtor under Sec.
364 of the Bankruptcy Code from CGII, Purchaser, Mirage or any other Person.
1.24. Disputed Claim means a Claim (or portion thereof) as to which: (a) a
proof of Claim has been filed, or deemed filed, under applicable law or
order of the Bankruptcy Court, with the Bankruptcy Court; (b) an objection
has been timely filed; and (c) such objection has not been: (i) withdrawn,
(ii) overruled or denied in whole by a Final Order, or (iii) granted in
whole or part by a Final Order: provided, however, the Bankruptcy Court may
estimate a Disputed Claim for purposes of allowance pursuant to Section
502(c) of the Bankruptcy Code; provided also however, that any claim
expressly allowed under this Plan cannot be a Disputed Claim or the subject
of an objection. For purposes of the Plan, a Claim shall be considered a
Disputed Claim to the extent it is disputed if: (x) before the time that an
objection has been or may be filed, the amount of the Claim specified in the
Proof of Claim exceeds the amount of any corresponding Claim scheduled by
the Debtor in the Schedules: (y) there is a dispute as to classification of
the Claim; or (z) the Claim is unliquidated.
1.25. Disputed Claims Reserve means the reserve established pursuant to
Article VI(B) in an amount equal to the sum of (i) the aggregate of all
Disputed Designated Administrative Claims, Disputed Priority Claims,
Disputed Priority Tax Claims, and Disputed Secured Claims, (ii) the amount
of Cash that would have been distributable, from time to time, under the
Plan on account of Disputed General Unsecured Claims and Convenience Claims
had such Claims been Allowed Claims, and (iii) any net earnings in respect
thereof.
1.26. Effective Date means the date that the Plan is consummated which
shall be simultaneous with the Closing.
1.27. Fee Request means any Administrative Claim for compensation or
reimbursement of expenses pursuant to Sections 327, 328, 329, 330, 331, or
503(b) of the Bankruptcy Code in connection with an application made to the
Bankruptcy Court in the Bankruptcy Case.
1.28. Final Order means an order or judgment of the Bankruptcy Court or
other court of competent jurisdiction which may hear appeals from the
Bankruptcy Court which having not been reversed, modified or amended, and
not being stayed, and the time to appeal from which or to seek review or
rehearing or petition for certiorari from which having expired without an
appeal or application for review or rehearing having been filed, has become
final and is in full force and effect.
1.29. General Unsecured Claim means any Allowed Claim against the Debtor,
other than a Bondholder Claim, Secured Claim, Administrative Claim, Priority
Claim, Priority Tax Claim, CGII Claim, Subordinated Unsecured Claim or
Convenience Claim.
1.30. Grand Palais means Grand Palais Riverboat, Inc., a Louisiana
corporation.
1.31. Indenture means the Indenture governing the Secured Notes, dated
February 17, 1994, as amended, between CGII, as issuer, the guarantors
thereunder, and the Indenture Trustee.
1.32. Indenture Trustee means First Trust National Association, as
indenture trustee under the Indenture, and any successor or assign thereof.
1.33. Institutional Note Holders' Steering Committee means that committee
consisting of Bondholders who hold a substantial principal amount of the
Secured Notes and have filed, in this case, a statement pursuant to
Bankruptcy Rule 2019(a).
1.34. Interest means, except as expressly otherwise specified in the Plan,
the interest or interest equivalent payable on any Claim calculated as
provided for in any agreement concerning such Claim which contains an
enforceable provision for the payment of interest, or, in the absence of any
such provision, at the Legal Rate.
1.35. Legal Rate means the rate of interest on outstanding judgments of the
courts of the State of Louisiana as prescribed by Louisiana Civil Code
article 2924.
1.36. License means the gaming license issued by the Louisiana State Gaming
Commission on or about April 4, 1994 in favor of the Debtor.
1.37. Liquidating Trustees means the Persons selected by the Creditors'
Committee and approved by the Bankruptcy Court who shall be the co-trustees
of Liquidating Trust.
1.38. Liquidating Trust means Crescent City Liquidating Trust, a New Jersey
trust or trust of such state as the Debtor and the Unsecured Creditors
Committee shall select, which shall be established as of the Effective Date,
for the single purpose of implementing and administering the Plan in
accordance with Section 1142(a) of the Bankruptcy Code.
1.39. Magic Agreement means the Agreement by and between CGII, the Debtor,
Casino Magic Corporation, Jefferson Casino Corporation and C-M of Louisiana,
Inc., dated February 21, 1996, pursuant to which Casino Magic Corporation,
through Jefferson Casino Corporation or another of its wholly owned
subsidiaries to which the Agreement is assigned, has agreed to purchase the
New Common Stock in conjunction with the consummation of the Plan, a copy of
which is attached hereto as Exhibit "1".
1.40. Magic Cash Consideration, is estimated to be $15,000,000.00, less the
Magic Deferred Cash.
1.41. Magic Closing Cash means Magic Cash Consideration less the balance of
principal and interest due Magic at closing on the Magic DIP Financing
Claim, estimated at $1,000,000.00, and to be retained by Magic from the
Magic Cash Consideration and applied to pay its DIP Financing Claim.
1.42. Magic Consideration means the Magic Cash Consideration, the Magic
Non-cash Consideration, and the Magic Deferred Cash.
1.43. Magic Deferred Cash means the Cash, in the amount of $500,000.00, to
be held in escrow, pursuant to the Magic Agreement, for a period of one (1)
year after Closing as security for the Debtor's and CGII's indemnities under
the Magic Agreement, and which, upon the expiration of the one (1) year
escrow period, the amount in the escrow, if any, will be disbursed to CGII
in accordance with Paragraph 3 of the Magic Agreement and this Plan.
1.44. Magic DIP Financing Claim shall mean that Claim of Purchaser arising
out of money borrowed or credit incurred by Debtor under Sec.364 of the
Bankruptcy Code.
1.45. Magic Non-Cash Consideration means all non-cash consideration to be
delivered to, or for the benefit of, the Debtor pursuant to the Magic
Agreement, including without limitation, Magic's obligation to assume or
otherwise satisfy the Bally and IGT Claims (up to an aggregate total not to
exceed $6,500,000.00) and the Magic Notes.
1.46. Magic Notes means the $35,000,000.00 of notes which shall be issued
by Reorganized Crescent City and guaranteed by Jefferson Casino Corporation
and C-M of Louisiana, Inc., each a wholly owned subsidiary of Casino Magic
Corporation, under the Mirage Indenture.
1.47. Mirage shall mean Mirage Resorts, Inc. or any of its affiliates,
subsidiaries, related entities, successors and assigns, and their respective
officers, directors and/or agents.
1.48. Mirage Agreement shall mean the Agreement among CGII, the Debtor and
Mirage pursuant to which Mirage was to purchase the New Common Stock, and
which Agreement formed the basis for Debtor's First Amended Plan of
Reorganization.
1.49. Mirage Claim means any and all claims which the Debtor or debtor in
possession may have, whether arising prior to or after the filing of the
petition for relief herein against Mirage, including but not limited to any
rights of setoff or defenses to the payments of any claims asserted by
Mirage against Debtor or its property.
1.50. Magic Indenture shall mean the Indenture governing the Magic Notes,
dated as of the Effective Date, between Reorganized Crescent City, as
issuer, and the guarantors, thereunder, in substantially the same form as
attached hereto as Exhibit "2".
1.51. Mirage Recovery shall mean any and all monies recovered, paid,
credited, set off or otherwise received by the Debtor , debtor-in-possession
or the Liquidating Trust on behalf of the Mirage Claim.
1.52. Net Cash Proceeds means only those Net Proceeds received in Cash.
1.53. Net Proceeds means all Cash and other property received upon the
sale, exchange or other disposition of any property, less all direct and
indirect costs incurred in connection with such disposition, including,
without limitation, fees, commissions, legal fees and expenses.
1.54. New Common Stock means all authorized common stock of Reorganized
Crescent City to be issued on the Effective Date to the Purchaser (which
shall constitute all the outstanding equity interests in Reorganized
Crescent City), pursuant to the Restated Certificate of Incorporation and
Article V(A) and XV of the Plan.
1.55. Plan means this plan under chapter 11 of the Bankruptcy Code, as the
same may be altered, amended, or modified from time to time.
1.56. Plan Document(s) means the document(s) that aid in effecting the Plan
and that are specifically identified herein as Plan Documents or which, in
the view of the Debtor, become necessary or appropriate to effectuate the
Plan, which documents, to the extent feasible, shall be filed on or prior to
the Confirmation Hearing.
1.57. Priority Claim means any Claim to the extent entitled to priority in
payment under Sections 507(a)(2)-(7) or 507(a)(9) of the Bankruptcy Code.
1.58. Priority Tax Claim means any Claim to the extent entitled to priority
in payment under Section 507(a)(8) of the Bankruptcy Code.
1.59. Pro Rata means a number (expressed as a percentage) equal to the
proportion that an Allowed Claim in a particular Class bears to the
aggregate amount of Allowed Claims in such Class as of the date of
determination. Solely for the purpose of calculating the amount to be
distributed to holders of Allowed General Unsecured Claims and reserved for
the holders of Disputed General Unsecured Claims on a Cash Distribution
Date, Liquidating Trust shall treat each Disputed General Unsecured Claim as
an Allowed Claim in the amount of such Disputed General Unsecured Claim
unless such of Disputed General Unsecured Claims have been estimated by the
Bankruptcy Court.
1.60. Purchaser means Casino Magic Corporation, through Jefferson Casino
Corporation or another of its wholly owned subsidiaries to which the Magic
Agreement is assigned.
1.61. Reallocation Date means the tenth (10) Business Day prior to any Cash
Distribution Date.
1.62. Reorganized Crescent City means the Debtor from and after the
Effective Date.
1.63. Residual Property means all of the property of the Debtor's estate
immediately prior to Closing, other than the Riverboat Assets. "Residual
Property" includes, without limitation, the Debtor's interest in the River
City JV or property previously owned or held by River City JV, all avoidance
actions specified in Article V(G) and other causes of action, claims of the
Debtor against Grand Palais and its affiliates, all contract rights of the
Debtor including its rights under the Magic Agreement, the Mirage Claim and
the Mirage Recovery, provided however, Residual Property does not include
the Magic Consideration, which shall be treated in accordance with the Plan.
1.64. Riverboat means the M/V Crescent City Queen, the riverboat owned by
the Debtor.
1.65. Riverboat Assets means, collectively, the Riverboat, the License,
certain slot machines and other coin-operated gaming devices acquired by the
Debtor from Bally Gaming, Inc. and International Game Technology Corp., and
such other items of personal property used in connection with the operation
of the Riverboat as may be agreed upon between the Debtor and the Purchaser,
and as evidenced on the inventory list attached to the Magic Agreement as
Exhibit "1", specifically excepting (i) any equipment licensing or other
agreements provided by Gaming Systems International and (ii) the Crescent
City Capital Escrow, as hereinafter defined, all monies therein and all
proceeds (in whatever form) thereof.
1.66. River City JV means the River City Joint Venture, a Louisiana general
partnership, comprised of the Debtor and Grand Palais, each as general
partner.
1.67. Schedules means the schedules of assets and liabilities filed by the
Debtor with the Bankruptcy Court in accordance with Section 521(1) of the
Bankruptcy Code, as amended from time to time.
1.68. Secured Notes means, collectively, the 111/2 Secured Notes due 2001,
issued by CGII pursuant to the Indenture.
1.69. Settlement Amount means the difference, in Cash, between the Magic
Closing Cash and $6,750,000.00 plus the difference, in Magic Notes, between
the Magic Notes and $28,000,000 of Magic Notes; the Settlement Amount is to
be paid by the Indenture Trustee from the Magic Consideration to the
Liquidating Trust.
1.70. Subordinated Unsecured Claim means: (a) an unsecured Claim against
the Debtor, proof of which is tardily filed under Section 501(a) of the
Bankruptcy Code; (b) any Claim against the Debtor whether a Secured Claim or
Unsecured Claim, for any fine, penalty or forfeiture, or for multiple
exemplary or punitive damages to the extent such fine, penalty, forfeiture,
or damages are not compensation for actual pecuniary loss suffered by the
holder of such Claim; (c) any Claim against the Debtor arising from
rescission of a purchase or sale of a security of the Debtor or of an
affiliate of the Debtor, for damages arising from the purchase or sale of
such security, or for reimbursement or contribution allowed under Section
502 of the Bankruptcy Code on account of such a Claim; and (d) any Claim
against the Debtor subordinated under Section 510 of the Bankruptcy Code or
under other applicable law to General Unsecured Claims by order of the
Bankruptcy Court.
1.71. Total [ ] Claims means, with respect to a particular Class of
Claims, the aggregate dollar amount of (a) all Allowed Claims, plus (b) the
Face Amount of all Disputed Claims, in such Class.
1.72. Voting Deadline means the date by which holders of impaired Claims
receiving distributions under the Plan must vote to accept or reject the
Plan.
B. Other Terms. The words "herein," "hereof," "hereto," "hereunder," and
others of similar inference refer to the Plan as a whole and not to any
particular section, subsection, or clause contained in the Plan unless
otherwise specified herein. A term used herein or elsewhere in the Plan
that is not defined herein shall have the meaning ascribed to that term, if
any, in the Bankruptcy Code or Bankruptcy Rules. The word "including" shall
mean including, without limitation. The headings in the Plan are only for
convenience of reference and shall not limit or otherwise affect the
provisions of the Plan.
C. Exhibits. All exhibits to the Plan are incorporated into and are a part
of the Plan as if set forth in full herein.
ARTICLE II
GENERAL DESCRIPTION OF THE PLAN
A. The Plan Generally. Under the Plan, the Debtor will sell the Riverboat
Assets (by reissuing its common stock) to the Purchaser for the Magic
Consideration. The Magic Closing Cash and the Magic Notes will be paid to
the Indenture Trustee, on behalf of the Bondholders, who claims a perfected
security interest in such proceeds. Upon receipt of the Magic Closing Cash
and the Magic Notes, the Indenture Trustee shall pay the Settlement Amount
to Liquidating Trust in accordance with Article II(B)(1) below, to be
distributed as provided herein. In addition, all of the Residual Property
will be transferred to Liquidating Trust and liquidated or otherwise
disposed of for the benefit of Debtor's Class 3A Creditors in accordance
with the terms of the Plan.
B. Payment of Settlement Amount.
1. Payment of Magic Closing Cash. Upon receipt of the Magic Closing Cash,
the Indenture Trustee, on behalf of the Bondholders, shall retain the sum of
$6,750,000.00 for distribution to Bondholders pursuant to the terms of the
Indenture and shall pay the remaining balance of the Magic Closing Cash
(estimated to be $6,750,000.00 less any amount by which the total balance of
principal and interest due to pay Magic's DIP Financing Claims and/or any
other DIP Financing Claims, excluding the DIP Financing Claim of Mirage, in
full, exceeds $1,000,000.00) to Liquidating Trust to be distributed and/or
reserved for Disputed Claims in accordance with the terms of this Plan.
2. Payment of Magic Notes. Upon receipt of the Magic Notes, the Indenture
Trustee, on behalf of the Bondholders, shall retain $28,000,000.00 of the
Magic Notes, for distribution to the Bondholders in accord with the
Indenture and shall assign the remaining $7,000,000.00 of Magic Notes to the
Liquidating Trust in accordance with the terms of this Plan.
ARTICLE III
CLASSIFICATION AND TREATMENT OF CLAIMS AND EQUITY INTERESTS
A. Summary. The categories of Claims and Equity Interests listed below
classify Claims and Equity Interests for all purposes, including voting,
confirmation, and distribution pursuant to the Plan.
CLASS STATUS
Class 1: Bondholder Claim Impaired - entitled to vote
Class 2: Secured Claims Impaired - entitled to vote
Class 3A: General Unsecured Claims Impaired - entitled to vote
Class 3B: Convenience Claims Impaired - entitled to vote
Class 3C: CGII Claims Impaired - entitled to vote
Class 4: Subordinated Unsecured Claims Impaired - deemed to reject
Class 5: Common Stock Impaired - deemed to reject
Class 6: Mirage Administrative/
Secured Claim Unimpaired - not entitled to vote
B. Administrative Claims. Subject to the applicable bar date provisions
contained in Article X(B), each holder of an Allowed Administrative Claim
shall be paid on account of such Claim in full, in Cash, from the
Liquidating Trust, on the later of: (a) the Effective Date (or as soon
thereafter as practicable), or (b) the first Cash Distribution Date
immediately following the date on which such Administrative Claim becomes an
Allowed Claim, except to the extent that the holder of an Allowed
Administrative Claim agrees to a different treatment; provided, however,
that Administrative Claims that are Allowed Claims representing obligations
incurred in the ordinary course of business by the Debtor will be paid by
Liquidating Trust when due in the ordinary course of business; and, provided
further, however, that Administrative Claims for payment of compensation or
reimbursement of expenses pursuant to Sections 330, 331 and 503(b) of the
Bankruptcy Code shall be paid within (3) Business Days of the entry of an
order by the Bankruptcy Court authorizing the payment of such fees and
expenses. Payments to the holders of the Administrative Claims shall be
made from the Net Cash Proceeds of one or more of the following sources, in
the following order of priority; the Settlement Amount and the Residual
Property.
C. Priority Claims. Each holder of an Allowed Priority Claim shall be paid
on account of such Claim in full, in Cash, from the Liquidating Trust, on
the later of (a) the Effective Date (or as soon thereafter as is
practicable), or (b) the first Cash Distribution Date immediately following
the date on which such Priority Claim becomes an Allowed Claim, or,
alternatively, upon such other terms as may be agreed upon by and between
the holder of such Claim and the Debtor or Liquidating Trust, as the case
may be. Payments to the holders of the Priority Claims shall be made from
the Net Cash Proceeds of one or more of the following sources, in the
following order of priority; the Settlement Amount and the Residual
Property.
D. Priority Tax Claims. Each holder of an Allowed Priority Tax Claim shall
be paid on account of such Claim in full, in Cash, from the Liquidating
Trust, on the later of (a) the Effective Date (or as soon thereafter as is
practicable), or (b) the first Cash Distribution Date immediately following
the date on which such Priority Tax Claim becomes an Allowed Claim, or,
alternatively, upon such other terms as may be agreed upon by and between
the holder of such Claim and the Debtor or Liquidating Trust, as the case
may be. Payments to the holders of the Priority Tax Claims shall be made
from the Net Cash Proceeds of one or more of the following sources, in the
following order of priority, the Settlement Amount and the Residual
Property.
E. Classification and Treatment. The Allowed Claims against, and Equity
Interests in, the Debtor, other than Administrative Claims, Priority Claims,
and Priority Tax Claims, shall be classified and receive the treatment
specified below.
Class 1:
1. Classification: Class 1 consists of the Bondholder Claim.
2. Allowance of Bondholder Claim: On the Effective Date, the Bondholder
Claim shall be deemed an Allowed Class 1 Claim in the amount of $142
million. The Bondholder Claim shall not, after the Effective Date, be
subject to, or the subject of, any objection, claim, counterclaim, set off,
defense, action or proceeding by the Debtor, Reorganized Crescent City, any
statutory committee, or any other party in interest, whether in law or
equity. To the extent any such objection, action or proceeding is pending
on or after the Effective Date, such action, objection or proceeding shall
be deemed withdrawn and the Bondholders may take such steps as they deem
appropriate to cause the Bankruptcy Court's records to reflect such
withdrawal (including, without limitation, seeking ex parte relief).
3. Treatment: As provided in Article II(B) of the Plan, upon receipt of
the Magic Closing Cash and the Magic Notes, the Indenture Trustee, on behalf
of the Bondholders, shall retain (i) Cash, in the amount of $6,750,000.00
and (ii) $28,000,000.00 of Magic Notes, all, and both, free and clear of any
and all liens, claims, privileges and encumbrances held or asserted by any
person other than the Indenture Trustee, for distribution to the Bondholders
pursuant to the terms of the Indenture, and the Indenture Trustee shall
immediately (i) pay the remaining balance of the Magic Closing Cash
(estimated to be $6,750,000.00, less any amount by which the total balance
of principal and interest due to pay Magic's DIP Financing Claims in full
exceeds $1,000,000.00) and (ii) assign the remaining Magic Notes, in the
amount of $7,000,000, to Liquidating Trust for distribution and/or
application in accordance with this Plan. The Indenture Trustee shall
retain the sum of $7,250,000.00 in Magic Closing Cash and $28,000,000.00 in
Magic Notes, to be paid to Class 1 Claimants in accordance with the terms of
the Indenture.
Additionally, any amounts to be paid to CGII from the Magic Deferred Cash,
as provided in this Plan, shall be subject to the security interest of the
Indenture Trustee. Any amounts to be paid to CGII from the Magic Deferred
Cash, shall be deposited by Purchaser in a segregated interest bearing
account designated by the Indenture Trustee at First Bank National
Association, subject in all respects to all of the first priority liens and
security interests of the Indenture Trustee, without any further action, and
shall not be disbursed absent the mutual consent of CGII and the Indenture
Trustee, or by an order of a court of competent jurisdiction.
Other than as set forth herein, the Class 1 claimants (including the
Indenture Trustee, the Bondholders, and anyone deriving or claiming rights
under the Secured Notes, the Indenture, or any security therefore), shall
not be entitled to participate as a Class 2, 3A or 3B Claimant under this
Plan on account of such claim.
4. Release of Defenses: As of the Effective Date, the Debtor, Debtor in
Possession, Liquidating Trust, all Creditors and equity security holders of
the Debtor shall release and waive: (i) all defenses to allowance of the
Bondholder Claim in the Bankruptcy Case, and (ii) all claims and causes of
action, if any, against the Bondholders or the Indenture Trustee based upon
or related to the Debtor's execution of its guarantee of CGII's obligations
under the Indenture, or based upon any payments made to the Indenture
Trustee by the Debtor.
Nothing herein shall constitute a waiver of any defenses to the allowance of
the claim of the Bondholders or the Indenture Trustee against CGII in any
other bankruptcy proceeding. Except with respect to the Debtor, nothing in
this Plan shall impair or otherwise affect any rights, liens, claims, or
interests of the Indenture Trustee or any Bondholder under the Notes, the
Indenture, or any related documents, including, but not limited to, any
rights, liens, claims or interests against CGII or any guarantor of CGII's
obligations.
5. Voting: Class 1 is Impaired by the Plan and the holder of Claims in
Class 1 are entitled to vote to accept or reject the Plan.
Class 2: Secured Claims
1. Classification: Class 2 consists of secured claims.
2. Determination of Allowed Secured Claim: Prior to the Effective Date,
the Debtor may seek and obtain a determination of the Allowed Secured Claim
of any Creditor asserting a Secured Claim pursuant to the Bankruptcy Code
and the Bankruptcy Rules.
3. Treatment: Except as provided in Article V(A) of the Plan, as to each
Allowed Secured Claim and in complete satisfaction of such Claim, at the
Debtor's option, either:
(i) (A) any default, other than of the kind specified in Section 365(b)(2)
of the Bankruptcy Code, shall be cured, provided that any accrued and unpaid
interest, if any, which the Debtor may be obligated to pay with respect to
such default shall be simple interest at the contract rate and not at any
default rate of interest;
(B) the maturity of such Claim shall be reinstated as the maturity existed
before any default;
(C) the holder of such Claim shall be compensated for any damage incurred
as a result of any reasonable reliance by the holder on any provision that
entitled the holder to accelerate maturity of such Claim; and
(D) the other legal, equitable, or contractual rights to which the Claim
entitles the holder shall not otherwise be altered; provided, however, that
as to any Allowed Secured Claim which is a nonrecourse claim and exceeds the
value of the collateral securing the Claim, the collateral may be sold at a
sale at which the holder of such Claim has an opportunity to bid;
(ii) on the Effective Date or such other date as may be agreed upon by the
Debtor or Liquidating Trust, as the case may be, and the holder of such
Allowed Secured Claim, the Debtor or Liquidating Trust, as the case may be,
shall abandon the collateral securing such Claim to the holder thereof in
full satisfaction and release of such Claim. The Claim held by Jones Casino
Supplies, Inc. ("Jones") shall be partially satisfied, based upon and in
consideration of the sale free and clear of all liens and other interests
pursuant to 11 U.S.C. 363(f), to Jones Casino Supplies, Inc., of the slot
machines and other gaming equipment manufactured by Sigma Games, Inc.
("Sigma"), and Advance Cart Technology, Inc. ("ACT") for a total credit of
$204,754.67 ($156, 387.20 for Sigma equipment and $48,367.47 for ACT
equipment), to be applied in reduction of the total Secured Claim of Jones
Casino Supplies, Inc. In the alternative, a partial credit shall be granted
following the abandonment of the slot machines and other equipment and
supplies manufactured by Sigma and ACT to Jones to allow it to foreclose its
security interest, and based upon the Court's determination as to the amount
of the secured portion of the Jones Claims, and the security interest and
liens held by Jones shall be preserved and retained by Jones pending the
Court's determination and the foreclosure; or
(iii) the holder of such Claim shall be paid, on account of such Allowed
Secured Claim: (a) in full, in cash, after the later of (i) the Effective
Date or (ii) the first Cash Distribution Date after the date such Secured
Claim becomes an Allowed Claim; or, if applicable, (b) upon such other terms
as may be agreed to between the Debtor or Liquidating Trust, as the case may
be, and the holder of such Allowed Secured Claim; provided, however, that as
to the Bally & IGT claims, upon such other terms as may be agreed to between
Reorganized Crescent City or the Purchaser, as the case may be, and the
respective holders of the Bally & IGT Claims. The security interest of
Bally and IGT shall survive confirmation until such claims are paid. The
security interests of any other secured claimant, shall be preserved and
retained, to survive confirmation, in either the specific collateral itself,
provided said collateral is not part of the Riverboat Assets, or preserved
and attaching to the proceeds that constitute the Settlement Amount and/or
the Residual Property, if the collateral is sold free and clear of liens and
interests, until paid.
(iv) Any Allowed Class 2 Claim found by Final Order to be secured by a lien
against any of the Riverboat Assets to be transferred to Purchaser and to be
senior to the lien securing the Class 1 Claims affecting the Riverboat
Property shall be paid in cash on the Effective Date or at such later date
as such determination is made by Final Order. Payments to the holders of
any such Class 2 Claims shall be made from the Net Cash Proceeds of one or
more of the following sources, in the following order of priority; the
Settlement Amount and the Residual Property. Any creditor determined by
final order to have an allowed Class 2 Secured Claim shall be paid to the
extent of the value of its collateral, with the creditor retaining its
security interest and lien, either as to the specific collateral, provided
said collateral is not part of the Riverboat Assets, or preserved and
attaching to the proceeds only that constitute the Settlement Amount and the
Residual Property, until the court's determination and payment, and shall
have an unsecured claim for any deficiency which shall then be recognized,
and the creditor paid its pro-rata distribution or share of the Settlement
Amount as set forth below, for the Class 3 Allowed General Unsecured Claims;
provided however, that notwithstanding anything contained in the Plan
(including specifically, without limitation, subsection 3(iii) and
subsection 3(iv) hereof), the rights, if any, of the Board of Commissioners
of the Port of New Orleans (the "Board") under that certain escrow agreement
between the Board and the Debtor and the lien or security interest, if any,
in favor of the Board, pursuant to the Escrow Agreement and/or Bert
Infrastructure Reimbursement Agreement (as amended) between the parties,
including without limitation, any valid, perfected and unavoidable lien or
security interest the Board has on or in that certain escrow account
numbered 785-1061190 at the First National Bank of Commerce, denominated as
"Crescent City Capital Escrow" and all monies therein and all proceeds (in
whatever form) thereof, shall survive confirmation.
4. Voting: Class 2 is impaired by the Plan and each holder of a Claim in
Class 2 shall be entitled to vote to accept or reject the Plan.
Class 3A: General Unsecured Claims
1. Classification: Class 3A consists of Allowed General Unsecured Claims.
2. Treatment: Each holder of an Allowed General Unsecured Claim shall
receive its Pro Rata share of the remainder of the Net Cash Proceeds of the
Settlement Amount, on account of their beneficial interests in the
Liquidating Trust, after payment or reserve for all (i) Administrative
Claims, (ii) Priority Claims, (iii) Priority Tax Claims (iv) Allowed Class
3B Claims, (v) Allowed Class 2 Claims found to be secured by a lien on any
of the Riverboat Assets and superior to the lien of the Class 1 Claimant,
and (vi) establishment of a reserve for payment of operating expenses of
Liquidating Trust (which initial reserve is not to exceed $1,000,000.00).
In addition to distributions from the Settlement Amount, Class 3A Claimants
shall receive Pro Rata distributions from all Net Cash Proceeds generated
from the Residual Property. However, there will be no distribution of the
Net Cash Proceeds generated from the Residual Property unless and until all
payments and/or reserves required under this paragraph have been made.
3. Voting: Class 3A is impaired and the holders of Claims in Class 3A are
entitled to vote to accept or reject the Plan.
4. Election To Be Treated As Holder Of Convenience Claim: On or before the
Voting Deadline, any holder of an Allowed General Unsecured Claim may elect
(by election on the ballot to be sent to all holders of Allowed General
Unsecured Claims, or thereafter until the Effective Date, by other written
election in form and substance satisfactory to the Debtor) to voluntarily
reduce its Claim to $5,000, and receive the same treatment as holders of
Claims in Class 3B.
5. Claims With Recourse to Insurance Coverage: To the extent the holder of
any General Unsecured Claim has recourse to any liability insurance policy
covering tort claims issued to or for the benefit of the Debtor, the holder
of such Claim must first, to the satisfaction of the Liquidating Trustees,
use its best efforts to collect its Allowed Claims from the insurance
carrier. Such collection will reduce the amount of such holder's Allowed
Claim by the amount of any payment received from such insurance carrier.
Any remaining unpaid portion of such Allowed General Unsecured Claim will be
treated under the other provisions applicable to Allowed General Unsecured
Claims. In the event the Liquidating Trustees determine that the holder of
any such Claim has not used its best efforts to collect the proceeds of such
insurance coverage, such Claim shall be treated as a Disputed Claim until
the Liquidating Trustees determine that such best efforts have been made.
Class 3B: Convenience Claims
1. Classification: Class 3B consists of Convenience Claims.
2. Treatment: Each holder of an Allowed Convenience Claim shall be paid
forty (40%) percent of the Allowed amount of such Claim, in Cash, on the
later of (a) the Effective Date (or as soon thereafter as is practicable),
or (b) the first Cash Distribution Date immediately following the date on
which such Convenience Claim becomes an Allowed Convenience Claim.
3. Voting: Class 3B is impaired and the holders of Claims in Class 3B are
entitled to vote to accept or reject the Plan.
Class 3C: CGII Claim
1. Classification: Class 3C consists of the CGII Claim.
2. Treatment: On the Effective Date, the Class 3C Claim shall be allowed in
the amount of $5,000,000 and the holder of the Class 3C Claim shall receive
on account of such Claim, the Magic Deferred Cash pursuant to the Magic
Agreement. The payment of the Magic Deferred Cash shall be subject to the
security interest of the Indenture Trustee. Any amounts of the Magic
Deferred Cash to be paid to CGII, pursuant to this Plan and the Magic
Agreement, shall be deposited by Purchaser in a segregated interest bearing
account at First Bank National Association, subject in all respects to all
of the first priority liens and interests of the Indenture Trustee, without
any further action, and shall not be disbursed absent the mutual consent of
CGII and the Indenture Trustee, or by an order of a court of competent
jurisdiction.
3. Voting: Class 3C is impaired and the Holder of Claims in Class 3C is
entitled to vote to accept or reject the Plan.
Class 4: Subordinated Unsecured Claims
1. Classification: Class 4 consists of Subordinated Unsecured Claims.
2. Treatment: Holders of Subordinated Unsecured Claims shall receive no
distribution under the Plan. There shall be a presumption that excusable
neglect does not exist in respect of those Claims.
3. Voting: Class 4 is impaired and is deemed to reject the Plan.
Class 5: Equity Interests
1. Classification: Class 5 consists of all Equity Interests.
2. Treatment: Holders of Equity Interests shall receive no distribution
under the Plan. All Equity Interests will be canceled and rendered void and
of no further force or effect on the Effective Date.
3. Voting: Class 5 is impaired and is deemed to reject the Plan.
Class 6: Mirage Administrative/Secured Claim
1. Classification: Class 6 consists of the Mirage Administrative/Secured
Claim.
2. Treatment: Pending resolution of Debtor's objection to Mirage's DIP
Financing Claim, the entire sum of $2,000,000.00, plus the estimated amount
of accrued and/or accruing interest for a period of one (1) year after
Closing shall be reserved by the Liquidating Trust for the benefit of
Mirage. Upon entry of a Final Order allowing the claim of Mirage, a sum
equal to the Allowed Claim shall be distributed to Mirage. The balance, if
any, shall then be available for distribution to members of other classes of
creditors, other than Class 1. Upon entry of a Final Order disallowing the
claim of Mirage the entire sum reserved shall be available for distribution
to members of other classes of creditors, other than Class 1.
3. Voting: Class 6 is unimpaired and is deemed to have accepted the Plan.
ARTICLE IV
ACCEPTANCE OR REJECTION OF THE PLAN
1. Voting Classes. Each holder of an Allowed Claim in Classes 1, 2, 3A, 3B
and 3C shall be entitled to vote to accept or reject the Plan, unless
otherwise ordered by the Court.
2. Deemed Rejection of the Plan. Classes 4 and 5 shall receive no
distribution under the Plan and, therefore, are deemed to reject the Plan.
The Debtor hereby requests that the Court confirm the Plan over such
rejections in accordance with subsection 1129(b) of the Bankruptcy Code.
3. Deemed Acceptance of Plan. Class 6 is unimpaired under the Plan, and,
therefore, is deemed to accept the Plan, and thus, will not receive a ballot
to vote on the Plan.
4. Confirmability of the Plan. The confirmation requirements of Section
1129 of the Bankruptcy Code must be satisfied with respect to the Debtor and
the Plan. If the Bankruptcy Court determines that any provisions of the
Plan are prohibited by the Bankruptcy Code, or render the Plan unconfirmable
under Section 1129 of the Bankruptcy Code, the Debtor reserves the right to
sever such provisions from the Plan, and to request that the Plan, as so
modified, be confirmed.
5. Nonconsensual Confirmation. In the event that any of Classes reject the
Plan, the Debtor reserves the right to request that the Court confirm the
Plan over such rejection in accordance with Section 1129(b) of the
Bankruptcy Code.
6. Controversy Concerning Impairment. In the event of a controversy as to
whether any Class of Claims or Equity Interests is Impaired under the Plan,
the Bankruptcy Court will, after notice and a hearing prior to the
Confirmation Date, determine such controversy.
ARTICLE V
MEANS OF IMPLEMENTATION OF THE PLAN
A. Closing of the Magic Agreement. On the Effective Date, Purchaser shall
pay the Magic Closing Cash and Magic Notes to the Indenture Trustee for the
benefit of the Bondholders, and Purchaser shall receive in exchange therefor
100% of the outstanding shares of New Common Stock of Reorganized Crescent
City, as of the Effective Date. Immediately upon receipt of the Magic
Closing Cash and Magic Notes, and after deducting the sum of $7,250,000.00
from the Magic Closing Cash and $28,000,000.00 from the Magic Notes, for
distribution to Bondholders in accordance with the terms of the Indenture,
the Indenture Trustee shall pay the Settlement Amount to the Liquidating
Trust. At Closing, Purchaser or Reorganized Crescent City shall assume or
shall otherwise satisfy the Bally & IGT Claims, without any cost or expense
to the Debtor or Liquidating Trust.
B. Cancellation of Equity Interests. On and as of the Effective Date, all
Equity Interests, including, without limitation, unexercised rights to
acquire shares of stock of the Debtor by way of option, warrant or other
legal or contractual rights, shall be automatically canceled and deemed to
be void.
C. Liquidation of the Assets. On the Effective Date, (a) all of the
Residual Property shall be transferred to Liquidating Trust, (b) each holder
of an Allowed Claim, to the extent such Claim is not satisfied on the
Effective Date, shall receive from Liquidating Trust (or such other party
specifically identified) the distributions provided in Article III of the
Plan, and (c) Liquidating Trust shall be managed by the Liquidating Trustees
in good faith so as to maximize the value of Liquidating Trust's property
through the orderly liquidation of such property in a commercially
reasonable manner under the continuing supervision of the Bankruptcy Court,
as provided by this Plan.
D. Corporate Governance and Management of Reorganized Crescent City;
Vesting of Assets and Discharge; Capitalization of Reorganized Crescent
City; Action Necessary for Riverboat Gaming Commission Approvals.
1. Corporate Governance of Reorganized Crescent City: On and after the
Effective Date, the Debtor shall continue in existence as Reorganized
Crescent City, a Louisiana corporation governed by the provisions of the
Amended Certificate of Incorporation, the Amended By-laws, and Louisiana
General Corporation Law.
2. Management of Reorganized Crescent City: On and after the Effective
Date, the operation of Reorganized Crescent City shall become the
responsibility of its board of directors and management.
3. Vesting of Assets and Discharge: On and after the Effective Date,
Reorganized Crescent City may operate its businesses and may use, acquire,
and dispose of its property without supervisions or approval by the
Bankruptcy Court and free of any restrictions of the Bankruptcy Code or
Bankruptcy Rules, other than as expressly provided herein. The Riverboat
Assets shall vest in Reorganized Crescent City free and clear of the claims,
liens, charges, encumbrances and interests, except as otherwise provided
herein. Except as otherwise provided herein, including the Magic Agreement
on and after the Effective Date, Reorganized Crescent City shall not be
liable for and shall be discharged from any and all Claims against the
Debtor, and all Equity Interests in the Debtor shall be canceled.
E. Establishment and Management of Liquidating Trust.
1. Upon confirmation hereof, and effective upon the Effective Date, the
three (3) persons identified by the Creditors' Committee prior to the
conclusion of the Confirmation Hearing, shall be appointed to act as Co-
Liquidating Trustees (the "Liquidating Trustees") of and to administer the
Liquidating Trust hereinafter created and to liquidate assets for the
benefit of the creditors of the Debtor's estate. The selections of the
persons to serve as Liquidating Trustees shall be subject to approval of the
Bankruptcy Court. Vacancies occurring after the original appointments shall
be governed by the Liquidating Trust documents. The Liquidating Trustees
shall be deemed to be the authorized representatives of the Estate for the
purpose of and consummation of the Plan pursuant to Sections 1103 and
1123(b)(3)(B) and other applicable sections of the Bankruptcy Code.
2. The Liquidating Trustees shall manage and govern the Liquidating Trust
by majority rule.
3. The Debtor hereby declares and establishes a Liquidating Trust, as
defined by Treas. Reg. Sec. 301.7701-4(d), (the "Liquidating Trust") for the
benefit of the creditors of the Debtor. The Liquidating Trust is organized
for the primary purpose of receiving, liquidating, and distributing the
cash, claims, and property transferred to the Liquidating Trust (the
"Liquidating Trust Property") in accordance with the provisions of this Plan
as promptly as is reasonably possible, with no objective to carry on or
conduct a for-profit trade or business. Upon transfer of the Liquidating
Trust Property to the Liquidating Trust, the Debtor shall retain no interest
in the Liquidating Trust Property.
4. The Liquidating Trust Property will be transferred to the Liquidating
Trust for the benefit of the creditors. The transfer shall be treated as a
transfer to creditors to the extent that the creditors are beneficiaries of
the Liquidating Trust. The transfer will be treated as a deemed transfer by
the beneficiary-creditors to the Liquidating Trust. The beneficiaries-
creditors of the Liquidating Trust will be treated as the grantors and
deemed owners of the Liquidating Trust.
5. The Liquidating Trust Property must be consistently valued by the
Liquidating Trustees and the beneficiary-creditors and said valuation must
be used for all federal income tax purposes.
6. The Liquidating Trustees must file returns for the Liquidating Trust as
a grantor trust pursuant to Sec. 1.671-4(a) of the Income Tax Regulations.
7. The Liquidating Trustees' powers shall be limited to recovering,
preserving and protecting the Liquidating Trust Property, liquidating the
Liquidating Trust Property as promptly as is reasonably possible and
distributing all income and proceeds from the liquidation of Liquidating
Trust Property in accordance with the terms of the Plan as promptly as is
reasonably possible. Except as otherwise inconsistent with the provisions of
this Plan, in the exercise of such powers, the Liquidating Trustees, on
behalf of the Liquidating Trust, shall be authorized to (i) avoid or recover
transfers (including fraudulent conveyances or preferential transfers) of
the Debtor's property as may be permitted by Sections 542 through 553 of the
Bankruptcy Code or applicable state law, (ii) pursue all claims and causes
of action arising from the prepetition activities of the Debtor, whether
arising by statute or common law and whether arising under the laws of the
United States of America, Louisiana, or any other state having jurisdiction
over any claim or controversy pertaining to the Debtor, and whether
maintainable against third parties, Affiliates or Insiders of the
Debtor,(iii) defend claims, causes of action and other litigation that may
adversely affect or impact the Liquidating Trust Property,(iv) contest
Claims, (v) file, litigate to final judgment, settle, or withdraw objections
to Claims, and (vi) exercise offsets against Claims. All activities of the
Liquidating Trustees shall be reasonably necessary to, and consistent with,
the accomplishment of the purpose of the Liquidating Trust as set forth in
this Plan. The Liquidating Trustees shall make continuing efforts to
liquidate and distribute proceeds from the liquidation of Liquidating Trust
Property, shall make timely distributions pursuant to the provisions hereof,
and shall not unduly prolong the duration of the Liquidating Trust.
8. The Liquidating Trustees shall have full and complete authority to do
and perform all acts, to execute all documents and to make all payments and
disbursements of funds necessary to carry out the purpose of the Liquidating
Trust as set forth in this Plan. The Liquidating Trustees shall make
distributions of proceeds from the liquidation of Liquidating Trust Property
and income from investments in accordance with this Plan.
9. Any party dealing with the Liquidating Trustees in relation to the
Liquidating Trust Property or any part thereof, including, but not limited
to, any party to whom Liquidating Trust Property or any part thereof shall
be conveyed or contracted to be sold by the Liquidating Trustees, shall not
be obligated in any way (i) to see to the application of any purchase money,
(ii) to see that the provisions of this Plan or the terms of the Liquidating
Trust have been complied with, or (iii) to inquire into any limitation or
restriction on the power or authority of the Liquidating Trustees. The
power of the Liquidating Trustees to act or otherwise deal with the
Liquidating Trust Property shall be absolute as to any party dealing with
the Liquidating Trustees in any manner whatsoever in relation to the
Liquidating Trust Property.
10. All costs, expenses, and obligations incurred by the Liquidating
Trustees in administering this Liquidating Trust or in any manner reasonably
connected, incidental or related thereto shall be a charge against the
Liquidating Trust Property. The Liquidating Trustees may approve and direct
the payment thereof or the retention by the Liquidating Trustees of adequate
reserves for such payment prior to making distributions to creditors
pursuant to this Plan.
11. The Liquidating Trustees shall keep or cause to be kept books
containing a description of all property constituting Liquidating Trust
Property and an accounting of receipts and disbursements, which shall be
open to inspection by creditor-beneficiaries at reasonable times upon
written request to the Liquidating Trustees or their counsel. The
Liquidating Trustees shall file with the Bankruptcy Court semi-annually (or
more often if deemed appropriate by the Liquidating Trustees) a statement of
receipts and disbursements for the Liquidating Trust. The Liquidating
Trustees shall establish and maintain separate accounts (including bank
accounts) for the receipt and expenditure of funds derived from the
Settlement Amount, the Administrative, Priority and Disputed Claims Reserve
and the Residual Property. The Liquidating Trustees, in their discretion,
may advance funds from the Settlement Amount Account for the purpose of
investigating, commencing litigation, or otherwise enhancing the value of
the claims and property to be deposited in the other accounts but such
advance(s) shall be considered loans and shall promptly be repaid from the
first available funds in such other accounts.
12. No recourse shall ever be had, directly or indirectly, against the
Liquidating Trustees or any Representatives of the Liquidating Trustees
(including without limitation, the employers of the Liquidating Trustees),
or against any employee of the Liquidating Trustees, whether by legal or
equitable proceedings, by virtue of any statute or otherwise, or by reason
of the creation of any indebtedness by the Liquidating Trustees under this
Liquidating Trust for any purpose authorized by this Liquidating Trust, it
being expressly understood and agreed that all liabilities, contracts and
agreements of the Liquidating Trustees, whether in writing or otherwise,
under this Liquidating Trust shall be enforceable only against and be
satisfied only out of the Liquidating Trust Property or shall be evidence
only of a right of payment out of the Liquidating Trust Property, as the
case may be. Nothing herein shall constitute a waiver of claims for
intentional torts, embezzlement or other fraudulent activity. Every
undertaking, contract, covenant or agreement entered into in writing by the
Liquidating Trustees, their Representatives, shall provide expressly against
the personal liability of the Liquidating Trustees, their Representatives
and employees.
13. The Liquidating Trustees shall receive no compensation for their
services but shall be entitled to reimbursement for all expenses incurred by
them in the performance of their duties as trustees, which expenses shall be
a charge against and paid out of the Liquidating Trust Property, in
accordance with the terms of this Plan. The reimbursement of expenses to the
Liquidating Trustees and reimbursement of expenses and compensation of
professionals employed by the Liquidating Trustees shall constitute a first
priority expense of the Liquidating Trust.
14. The Liquidating Trustees shall be relieved of any and all duties,
restrictions or liabilities imposed upon Liquidating Trustees by applicable
laws of the governing state, including the provisions of the trust laws of
the governing state as in effect, in the governing state, on the Effective
Date and as it may thereafter be amended, so that the Liquidating Trustees
shall be liable only for acts of self-dealing or bad faith, or intentionally
adverse acts or reckless indifference to the interests of the creditors of
the Debtor. The fact that any act or failure to act of the Liquidating
Trustees was advised by an attorney acting as attorney for the Liquidating
Trust or the Liquidating Trustees shall be conclusive evidence of the
Liquidating Trustees' good faith in performing or failing to perform such
act.
15. The Liquidating Trust shall be effective as of the Effective Date and
shall remain and continue in full force and effect until the Liquidating
Trust Property has been wholly converted to cash, all costs, expenses and
obligations incurred in administering this Liquidating Trust have been fully
paid and discharged and all remaining income, proceeds and assets of the
Liquidating Trust Property have been distributed as herein set forth.
Notwithstanding the above, the Liquidating Trust created herein shall
terminate within(3) years from the Effective Date or within such further
time as is reasonably necessary to accomplish full liquidation and
disbursement; provided, however, in no event shall this Liquidating Trust
extend beyond five (5) years from the Effective Date.
16. Subject to approval of the Bankruptcy Court, the Liquidating Trustees
may engage attorneys, accountants and agents to advise or assist the
Liquidating Trustees in the administration of the Liquidating Trust and to
represent the Liquidating Trustees in all matters relating to the
Liquidating Trust. The Liquidating Trustees shall pay the reasonable fees,
charges and expenses of such attorneys and accountants who provide services
after the Effective Date as a priority expense of the Liquidating Trust, in
accordance with the terms this Plan. Subject to the availability of
sufficient funds in the Administrative Reserve, the fees and expenses of
such professionals and agents shall be paid upon the monthly submission of
bills to Liquidating Trust. If no written objection to payment is received
within five (5) Business Days following delivery of any bill, the bill shall
be paid by Liquidating Trust. If there is a dispute as to the amount of any
bill, such dispute shall be submitted to the Bankruptcy Court for a
determination of the reasonableness of such bill. Subject to the
availability of sufficient funds in the Administrative Reserve, the
uncontested portion of each bill shall be paid within ten (10) Business Days
after its delivery. As provided infra, to the extent funds are or become
available, fees and expenses of professionals and others involved in
investigating, recovering, or liquidating Residual Property shall be paid
from such recoveries. To the extent that contingent fee litigation is
desirable or necessary, the Liquidating Trustees are authorized to hire
counsel to pursue such litigation at a reasonable contingent fee. The
Liquidating Trust, which shall succeed to the Debtor's interest in the
property transferred to it pursuant to this Plan, shall constitute a
successor in interest to the Debtor. Accordingly, upon the Effective Date,
the Liquidating Trustees, on behalf of the Liquidating Trust, shall become
the owner and holder, of all privileges (including the attorney-client
privilege) owned or held by the Debtor, whether owned or held by the Debtor
individually or jointly and whether concerning pre-petition Date or post-
petition Date matters.
17. This Liquidating Trust shall be administered and governed by the laws
of the State of New Jersey or such other state (the "governing state") as
the Debtor and the Creditors' Committee shall select, which shall be
established as of the Effective Date, and any questions arising hereunder
shall be resolved and determined in accordance with the laws of the
governing state, without regard to principles of conflicts of law.
18. On the Effective Date, (a) the filing by Liquidating Trust of its Trust
Articles which shall be a Plan Document shall be deemed authorized and
approved in all respects, and (b) the appointment of the Liquidating
Trustees by the Bankruptcy Court in the Confirmation Order, and the other
matters provided under the Plan concerning the structure of Liquidating
Trust or action by Liquidating Trust, shall be deemed to have occurred and
shall be in effect without any requirement of further action or order of the
Bankruptcy Court. On the Effective Date, (a) the filing by Reorganized
Crescent City of the Amended Certificate of Incorporation and the adoption
of the Amended By- laws shall be deemed authorized and approved in all
respects, and (b) to the extent identified by the Purchaser on such date,
the appointment of the directors and officers of Reorganized Crescent City,
and the other matters provided under the Plan concerning the corporate
structure of Reorganized Crescent City, or corporate action by Reorganized
Crescent City or corporate action by Reorganized Crescent City, shall be
deemed to have occurred and shall be in effect from and after the such time
without any requirement of further action or order of the Bankruptcy Court.
The Directors and officers of the Debtors will be deemed to have resigned as
of the Effective Date.
F. Commission Approvals.
1. Corporate Governance of Reorganized Crescent City: On and after the
Effective Date, the Debtor shall continue in existence as Reorganized
Crescent City, a Louisiana corporation governed by the provisions of the
Amended Certificate of Incorporation, the Amended By-laws, and Louisiana
General Corporation Law.
2. Management of Reorganized Crescent City: On and after the Effective
Date, the operation of Reorganized Crescent City shall become the
responsibility of its Board of Directors and management.
3. Vesting of Assets and Discharge: On and after the Effective Date,
Reorganized Crescent City may operate its businesses and may use, acquire,
and dispose of its property without supervisions or approval by the
Bankruptcy Court and free of any restrictions of the Bankruptcy Code or
Bankruptcy Rules, other than as expressly provided herein. The Riverboat
Assets shall vest in Reorganized Crescent City free and clear of the claims,
liens, charges, encumbrances and interests, except as otherwise provided
herein. Except as otherwise provided herein, on and after the Effective
Date, Reorganized Crescent City shall not be liable for and shall be
discharged from any and all Claims against the Debtor, and all Equity
Interests in the Debtor shall be canceled.
4. Action Necessary for Riverboat Gaming Commission Approvals: On and after
the Confirmation Date, Purchaser and the Debtor shall take all reasonable
steps necessary to obtain any and all authorizations, certifications and
operating authorities and any other like permits necessary for Reorganized
Crescent City to start operations on, or on the earliest date possible after
the Effective Date.
H. Assignment of Causes of Action. On the Effective Date, except as
otherwise provided herein, all rights, claims, and causes of action pursuant
to: (a) Sections 541, 542, 544, 545, 547, 548, 549, 550 and 553 of the
Bankruptcy Code; and (b) all other claims and causes of action of the Debtor
against any Person as of the Effective Date including but not limited to the
Mirage Claim and any right to the Mirage Recovery, shall be preserved and
become property of Liquidating Trust. On the Effective Date, Liquidating
Trust shall be deemed the representative of the Estate under Section 1123(b)
of the Bankruptcy Code and will be authorized and shall have the power to
commence and prosecute any and all causes of action which could have been
asserted by the Estate. Liquidating Trust may pursue such causes of action
in the Bankruptcy Court and may retain such counsel, accountants or other
Persons as Liquidating Trust deems necessary in connection therewith or in
connection with liquidation of the Residual Property or performance of the
responsibilities of Liquidating Trust and the Liquidating Agent. All
recoveries, if any, received from or in respect of the causes of action
(whether by settlement, judgment or otherwise) shall become the property of
Liquidating Trust to be distributed pursuant to the terms of the Plan. The
costs and expenses, including legal fees and disbursements, incurred in
connection with the prosecution of such causes of action, shall be paid by
Liquidating Trust without necessity of approval by the Bankruptcy Court.
From and after the Effective Date, Liquidating Trust shall litigate any
avoidance or recovery actions and any other causes of action or rights to
payments of claims that belong to the Debtor that may be pending on the
Effective Date or instituted by Liquidating Trust after the Effective Date.
I. Waiver of Subordination. The distributions under the Plan take into
account the relative priorities of the Claims in each Class in connection
with any contractual subordination provisions relating thereto.
ARTICLE VI
ESTABLISHMENT OF RESERVES
A. Administrative Reserve.
1. Creation of Administrative Reserve: On the Effective Date, Liquidating
Trust shall establish an interest bearing account with a major money center
bank in an amount necessary to create and maintain the Administrative
Reserve, as same shall be determined by the Debtor at the Confirmation
Hearing and approved by the Bankruptcy Court. The money in the
Administrative Reserve shall be used to fund (i) the continuing
administration of Liquidating Trust, including the administration of Claims,
and the filing and prosecutions of objections thereto, (ii) the payment of
taxes for which the Liquidating Trust is liable, (iii) the maintenance of
insurance policies, (iv) the enforcement and prosecution of claims of or
claims assigned to the Liquidating Trust in conjunction with the marshaling
of the Residual Property, (vi) the liquidation by conversion to Cash or
other methods of the remaining Residual Property, and (vii) the payment of
the actual fees and expenses incurred in connection with all of the above-
described activities. The Administrative Reserve shall not be used to fund
the operations or pay any expenses of Reorganized Crescent City.
2. Maintenance of the Administrative Reserve: Liquidating Trust shall
maintain sufficient Cash in the Administrative Reserve as it in good faith
deems necessary to ensure the continued funding of the activities described
in Subsection 1 of this Article VI(E) of the Plan.
3. Investment of the Administrative Reserve: Liquidating Trust shall be
permitted, from time to time, to invest all or a portion of the Cash in the
Administrative Reserve in United States Treasury Bills, interest-bearing
certificates of deposit, tax exempt securities, or investments permitted by
Section 345 of the Bankruptcy Code, using prudent efforts to enhance the
rates of interest without inordinate credit risks or interest rate risks.
All interest earned on such Cash shall be held by Liquidating Trust and (i)
kept in the Administrative Reserve and utilized to fund the operation of
Liquidating Trust, and, to the extent of any excess, (ii) transferred to an
available cash reserve for distribution in accordance with the Plan.
4. Distribution of the Administrative Reserve: After completion by
Liquidating Trust of all tasks remaining to liquidate fully its assets and
distribute the proceeds therefrom in accordance with the Plan, including the
payment of all charges and taxes related thereto, any amounts remaining in
the Administrative Reserve will be distributed to Class 3A Claimants.
B. The Disputed Claims Reserve.
1. Creation of the Disputed Claims Reserve: On or before the first (1st)
Cash Distribution Date, Liquidating Trust shall establish a segregated
interest-bearing account with a major money center bank. On the first (1st)
Cash Distribution Date and each subsequent Cash Distribution Date, from the
Settlement Amount or the Net Cash Proceeds attributable to the Residual
Property, as applicable, Liquidating Trust shall deposit into such account,
or otherwise reserve, an amount of Cash and/or Magic Notes sufficient to pay
all Disputed Administrative Claims, Disputed Priority Claims, Disputed
Priority Tax Claims, Disputed Secured Claims, Disputed Convenience Claims
and Disputed General Unsecured Claims that would have been distributable on
account of such Claims had such Claims been Allowed Claims on the relevant
date. The reserve shall be based upon the amount ordered by the Court in
accordance with the Court's authority to estimate contingent and/or
unliquidated claims under 11 U.S.C. Sec.502(c) or, if no estimate has been
made, the amount of the Claims, as filed.
2. Claims With Recourse to Insurance Coverage: All Allowed General
Unsecured Claims with recourse to insurance coverage policies of the Debtor
covering tort claims shall be deemed Disputed Claims in their Face Amount or
as otherwise ordered by the Court, and Cash and/or Magic Notes shall be set
aside in the Disputed Claims Reserve on the first (1st) Cash Distribution
Date to account for such Claims. Upon receipt of notice that any such Claim
has been satisfied in whole, or in part, by the Debtor's insurance policies,
Liquidating Trust will reduce the amount on deposit in the Disputed Claims
Reserve by an amount equal to the amount allocable to the Claim or portion
thereof so satisfied. Upon receipt of notice that a Claim entitled to
coverage under an insurance policy of the Debtor is not satisfied, in whole,
or in part, under such policy, within sixty (60) days of the Effective Date,
and such Claim is not disputed in whole or in part by Liquidating Trust,
Liquidating Trust shall distribute to the holder of such Claim, Cash set
aside in the Disputed Claims Reserve on account of that portion of such
Claim that has not been satisfied by coverage under an insurance policy.
3. Payment of Expenses of the Disputed Claims Reserve: Liquidating Trust
shall pay, or cause to be paid, out of the funds held in the Disputed Claims
Reserve, all expenses of the Disputed Claims Reserve, including any tax
imposed by any governmental unit on the income generated by the funds held
in the Disputed Claims Reserve. Liquidating Trust shall also file or cause
to be filed any tax or information returns related to the Disputed Claims
Reserve that are required by any governmental unit.
4. Investment of Disputed Claims Reserve: Liquidating Trust shall be
permitted, from time to time, to invest all or a portion of the Cash in the
Disputed Claims Reserve in United States Treasury Bills, interest-bearing
certificates of deposit, tax exempt securities, or investments permitted by
Section 345 of the Bankruptcy Code, using prudent efforts to enhance the
rates of interest without inordinate credit risks or interest rate risks.
All interest earned on such Cash shall be held by Liquidating Trust and,
after satisfaction of any expenses incurred in connection with the
maintenance of the Disputed Claims Reserve, distributed in accordance with
the Plan.
5. Excess Funds: If, on any Reallocation Date, Liquidating Trust
determines there are excess funds on deposit in the Disputed Claims Reserve,
such excess funds (including any interest earned thereon) will be released
from the Disputed Claims Reserve and deposited in the Available Cash Reserve
and distributed to Class 3A Claimants in accordance with this Plan.
ARTICLE VII
PROVISIONS FOR TREATMENT OF DISPUTED AND CONTINGENT CLAIMS
A. Objections to Claims. Unless another date is established by the
Bankruptcy Court, all objections to Claims that were filed prior to the
Effective Date shall be filed and served on the holders of such Claims by
the sixtieth (60th) after the Effective Date, or such date as extended by
the Court. If any objection has not been filed to a proof of Claim or a
scheduled Claim by the objection bar date, the Claim to which the proof of
claim or scheduled Claim relates shall be treated as an Allowed Claim if
such Claim has not been Allowed or Disallowed earlier. After the Effective
Date, except as to objections to claims filed by persons other than the
Debtor, only the Liquidating Trustees shall have the authority to prosecute,
settle, compromise, withdraw or litigate to judgment objections to Claims
and counterclaims, all of which shall be prosecuted in the Bankruptcy Court.
B. Payments and Distributions on Disputed Claims. Notwithstanding any
provision in the Plan to the contrary, no payments or distributions will be
made with respect to a Disputed Claim until the resolution of such dispute
by settlement or Final Order. On the first Cash Distribution Date that is
at least forty-five (45) days after a Disputed Claim becomes an Allowed
Claim, the holder of such Allowed Claim will receive all distributions,
including its share of the net earnings of the Disputed Claims Reserve, to
which such holder is then entitled under the Plan. Notwithstanding the
foregoing, any Person who holds both an Allowed Claim(s) and a Disputed
Claim(s) will receive the appropriate payment or distribution on the Allowed
Claim(s), although no payment or distribution will be made on the Disputed
Claim(s) until such dispute is resolved by settlement or Final Order.
C. Disputed General Unsecured Claims.
1. Estimation: For purposes of effectuating the reserve provisions of
Article VI of the Plan and the allocations and distributions to holders of
Allowed General Unsecured Claims, the Bankruptcy Court will, on or prior to
the Confirmation Date, pursuant to Section 502 of the Bankruptcy Code, fix
or liquidate the amount of any Contingent General Unsecured Claim not
otherwise treated in the Plan, in which event the amount so fixed or
liquidated will be deemed the Allowed amount of such Claim for purposes of
this Plan, or, in lieu thereof, the Bankruptcy Court will determine the
maximum contingent amount for such Claim, which amount will be the maximum
amount in which such Claim ultimately may be Allowed under this Plan, if
such Claim is Allowed in whole or in part. The right of a Creditor under
Section 502(j) of the Bankruptcy Code to obtain reconsideration of a Claim
that has been estimated can only be exercised within thirty (30) days after
the Effective Date. Thereafter, no Claims that have been estimated for the
purpose of allowance may be reconsidered.
2. Distributions Upon Allowance: To the extent a Disputed General
Unsecured Claim becomes an Allowed Claim, on the next succeeding Cash
Distribution Date that is at least forty-five (45) days after a Disputed
Claim becomes an Allowed Claim, there will be distributed to the holder of
such Allowed Claim out of the Disputed Claims Reserve, in accordance with
the applicable provisions of this Plan, the amount of Cash on deposit in the
Disputed Claims Reserve allocable to the Claim so Allowed, plus its share of
the net earnings of the Disputed Claims Reserve.
ARTICLE VIII
DISTRIBUTIONS UNDER THE PLAN
B. Distributions.
1. On the Effective Date, or as soon thereafter as is reasonably
practicable, distributions of Cash shall be made by Liquidating Trust in
accordance with the relevant provisions of Article III hereof, on account of
Allowed Administrative Claims, Allowed Priority Claims, Allowed Priority Tax
Claims, and Allowed Secured Claims that are entitled to a Cash payment under
the Plan.
2. On the first (1st) Cash Distribution Date, or as soon thereafter as is
reasonably practicable, distributions of Cash shall be made by Liquidating
Trust in accordance with the relevant provisions of Article II hereof, on
account of Allowed Convenience Claims and Allowed General Unsecured Claims;
and
3. Subsequent distributions of (a) Net Cash Proceeds of the Residual
Property, and (b) previously undistributed Cash to the holders of Allowed
General Unsecured Claims, may be made if, on any Cash Distribution Date
(excluding the first (1st) Cash Distribution Date), the Liquidating
Trustees, in their discretion, determine that Liquidating Trust has
accumulated sufficient funds to justify a distribution.
4. On each Reallocation Date, the Liquidating Trustees will determine the
amount of Cash to be distributed on account of previously Allowed Claims and
Disputed Claims that have become, in whole or in part, Allowed Claims. The
Liquidating Trustees shall, if appropriate, make distributions from the
Disputed Claims Reserve on each Cash Distribution Date.
5. Fractional cents will not be distributed and shall revert to Liquidating
Trust.
B. Method of Payment. Payments to be made by Liquidating Trust pursuant to
the Plan will be made by check drawn on a domestic bank or, if in excess of
$1,000,000, by wire transfer of next day available funds.
C. Amendment of Plan. The Plan may be amended by the Debtor before, and
the Liquidating Trustees after, the Effective Date as provided in Section
1127 of the Bankruptcy Code.
D. Implementation. The Debtor and Liquidating Trust, as the case may be,
will be authorized to take all necessary steps, and perform all necessary
acts, to consummate the terms and conditions of the Plan.
E. Method of Distributions Under the Plan. All distributions of Cash and
other property shall be made by the Liquidating Trustees pursuant to the
Plan on the Effective Date or applicable Cash Distribution Date, as the case
may be, or as soon thereafter as is practicable (a) at the addresses set
forth in the proofs of claim filed by such holders; (b) at the addresses set
forth in any written notices of address change delivered to the Debtor or
Liquidating Trust after the date on which any related proof of claim was
filed; or (c) at the address reflected in the Schedules if no proof of claim
has been filed and Liquidating Trust has not received a written notice of a
change of address.
F. Undeliverable Distributions.
2. Distributions Held by Liquidating Trust: If the distribution to any
holder of an Allowed Claim is returned as undeliverable, no further
distributions shall be made to such holder unless and until the Liquidating
Trustees is notified in writing by such holder of the holder's current
address at which time all previously missed distributions shall be mailed to
such holder. Undeliverable distributions shall belong to Liquidating Trust
and be held in the account from which such distribution was made (e.g., the
Settlement Amount account, the Residual Property account, etc.).
3. After Distributions Become Deliverable: On each Cash Distribution Date,
Liquidating Trust shall make all distributions that have become deliverable
since the immediately prior Cash Distribution Date. Distributions from the
Disputed Claims Reserve shall be made in all instances as soon as
practicable after the same become deliverable.
4. Failure to Claim Undeliverable Distributions: Any holder of an Allowed
Claim that does not assert a claim pursuant to the Plan for an undeliverable
distribution within two (2) years after the Distribution Date shall have its
Claim for such undeliverable distribution discharged and shall be forever
barred from asserting any such claim for an undeliverable distribution. In
such case, any Cash held for distribution on account of such Claims for
undeliverable distributions shall be redeposited into the Administrative
Reserve for distribution to holders of Allowed Class 3A Claims on the next
Cash Distribution Date after such distributions become undeliverable
pursuant to the terms hereof. Nothing contained in the Plan shall require
Liquidating Trust to attempt to locate any holder of an Allowed Claim.
Checks issued in respect of distributions to the holders of Allowed Claims
shall be null and void if not cashed within 90 days of the date of issuance
thereof. Requests for the reissuance of any check shall be made directly to
Liquidating Trust by the holder of the Allowed Claim with respect to which
such check was originally issued. Any Claim in respect of such a check
voided shall be made on or before the sixth (6th) month anniversary of the
issuance of such check. After such date, all Claims in respect of a check
voided pursuant to this Subsection shall be discharged and forever barred.
ARTICLE IX
EXECUTORY CONTRACTS AND UNEXPIRED LEASES
B. Rejection of Executory Contracts and Unexpired Leases. On the
Confirmation Date (but subject to the occurrence of the Effective Date), all
executory contracts or unexpired leases that exist between the Debtor and
any Person, that have not been assumed or rejected by order of the
Bankruptcy Court or which are not the subject of a motion to assume or
reject pending on the Confirmation Date, will be deemed rejected in
accordance with the provisions and requirements of Section 365 of the
Bankruptcy Code. Entry of the Confirmation Order by the Clerk of the Court
shall constitute an order approving such rejections pursuant to Section
365(a) of the Bankruptcy Code.
C. Claims Based on Rejection of Executory Contracts or Unexpired Leases.
All proofs of claim with respect to Claims arising from the rejection of
executory contracts or unexpired leases must be filed with the Bankruptcy
Court no later than twenty-five (25) days after the Confirmation Date. Any
Claims not filed within such time will be forever barred from assertion
against the Debtor, the Estate and its property, Liquidating Trust, or the
Disputed Claims Reserve. Unless otherwise ordered by the Bankruptcy Court,
all such Claims arising from the rejection of executory contracts or
unexpired leases will be, and will be treated as Class 3A, General Unsecured
Claims or Class 3B Convenience Claims or Class 4 Subordinated Claims as the
case may be.
ARTICLE X
ADMINISTRATIVE PROVISIONS
A. Retention of Jurisdiction. The Bankruptcy Court will retain and have
exclusive jurisdiction on and after the Confirmation Date for the following
purposes:
1. to hear and determine objections to Administrative Claims or Proofs of
Claims whenever filed both before and after the Confirmation Date, including
any objections to the classification of any Claim and to allow or disallow
any Disputed Claim, in whole or in part;
2. to hear and determine any and all motions to estimate Claims regardless
of whether the Claim is the subject of a pending objection, a pending appeal
or otherwise;
3. to hear and determine any and all pending applications for the
rejection or assumption of executory contracts or unexpired leases to which
a Debtor is a party or with respect to which a Debtor may be liable and to
hear and determine, and, if need be, to liquidate, any and all Claims
arising therefrom;
4. to enforce the provisions of the Plan and to enforce any proposed
amendments thereto;
5. to ensure that distributions, if any, to holders of Allowed Claims are
accomplished as provided herein;
6. to determine any and all applications, adversary proceedings and
contested or litigated matters that may be pending on the Effective Date or
commenced thereafter;
7. to consider any modifications of the Plan, to cure any defect or
omission, or reconcile any inconsistency in any order of the Bankruptcy
Court, including, without limitation, the Confirmation Order;
8. to hear and determine all controversies, suits and disputes that may
arise in connection with the interpretation, implementation or enforcement
of the Plan, the Estate's obligations, releases under the Plan, or any Claim
asserted against any representative of the Estate or its agents;
9. to hear and determine all controversies concerning the Magic Agreement.
10. to hear and determine all controversies concerning the Mirage
Agreement, the Mirage DIP Financing Claims and any other claims and/or
dispute asserted by or against Mirage;
11. to enter such orders in aid of execution of the Plan to the extent
authorized by Section 1142 of the Bankruptcy Code, including such orders
aiding or promoting the transfer of the economic or ownership interest of
the Debtor, but not to the extent that such orders are in regard to matters
within the sole jurisdiction of police or regulatory authorities;
12. to determine such other matters as may be set forth in the Confirmation
Order or as may arise in connection with the Plan (including, without
limitation, Article XIII thereof) or the Confirmation Order or their
implementation;
13. to hear and determine all controversies, suits and disputes that may
arise with respect to the Residual Property;
14. to enforce all orders, judgments, injunctions and rulings entered in
connection with the Reorganization Case;
15. to determine any and all applications for allowance of compensation and
reimbursement of expenses and any other fees and expenses authorized to be
paid or reimbursed under the Bankruptcy Code or the Plan;
16. to hear and determine all proceedings to recover all assets of the
Debtor and property of the estate, wherever located, including any causes of
action under Sections 544 through 551 and 553(b) of the Bankruptcy Code, and
any other causes of action or rights to payment of Claims, that belong to
the Debtor, that may be pending on the Confirmation Date or that may be
instituted at any time by Liquidating Trust thereafter;
17. to hear and determine any disputes between the Liquidating Trustees and
Liquidating Trust or with respect to either of them;
18. to hear and determine matters concerning state, local and federal taxes
in accordance with Sections 346, 505 and 1146 of the Bankruptcy Code;
19. to approve the retention of professionals by Liquidating Trust and to
approve all requests for payment of fees and expenses by such professionals;
20. to hear any other matter as to which jurisdiction is not inconsistent
with the Bankruptcy Code; and
21. to enter a final decree or decrees closing the Reorganization Case.
B. Bar Date For Filing Claims Pursuant to Section 503(b) of the Bankruptcy
Code.
2. Administrative Claims Generally: Subject to further order of the
Bankruptcy Court, all applications for payment of Administrative Claims
(other than Administrative Claims that constitute Fee Requests) pursuant to
Section 503(b) of the Bankruptcy Code shall be filed with the Bankruptcy
Court within five (5) Business Days after the Effective Date. Any requests
for payment of such Administrative Claims not so scheduled by the Debtor or
filed within such time period shall be discharged and forever barred except
as otherwise may be ordered by the Bankruptcy Court.
3. Fee Requests:
A. All Fee Requests must be filed with the Bankruptcy Court within forty-
five (45) days after the Effective Date. Objections to such Fee Requests
may be filed by any party in interest within the later of sixty (60) days
after the Effective Date and sixty (60) days after such Fee Request is filed
with the Bankruptcy Court.
B. On or prior to the Confirmation Date, each Person that has sought or
will seek to file a Fee Request shall deliver to the Debtor an estimate of
the aggregate fees and expenses through the Effective Date which shall be
requested by such Person (including, if applicable, any amount previously
requested and subject to holdback). Any such estimate shall be binding on
such Person and such Person shall not apply for fees and expenses accruing
during the Reorganization Case in excess of such estimate; provided,
however, that such estimate shall not be binding unless the Confirmation
Order is entered within ten (10) Business Days of the scheduled Confirmation
hearing.
ARTICLE XI
CONDITIONS TO CONFIRMATION
AND EFFECTIVE DATE OF THE PLAN
A. Conditions to Entry of Confirmation Order. The Plan shall not be
confirmed unless the following conditions have been satisfied or waived as
specified in Article XI(C):
1. The Magic Closing Cash is estimated to be sufficient to pay the
Liquidating Trust the Settlement Amount of no less than $6,000,000.00;
B. Conditions to Effective Date. The Effective Date of the Plan shall not
occur unless and until the following conditions shall have been satisfied:
1. Entry of Confirmation Order in a form and substance satisfactory to the
Debtor, Purchaser, the Institutional Note Holders' Steering Committee and
the Creditors' Committee;
2. At Closing, Purchaser has assumed or otherwise satisfied or arranged to
satisfy the Bally & IGT Claims as provided in V(A) of the Plan;
3. The Confirmation Order shall have been entered;
4. The Confirmation Order shall not be currently stayed; and
5 The Closing has occurred or will occur simultaneously.
C. Waiver of Conditions.
1. Article XI(A)(1) may be waived by unanimous consent of the Creditors'
Committee, without regard to abstentions.
3. Article XI(B)(2) may be waived by the Creditors' Committee.
ARTICLE XII
EFFECTS OF CONFIRMATION
A. Binding Effect/Injunction.
1. Except as otherwise expressly provided in the Plan, on and after the
Effective Date, the terms of the Plan shall bind all holders of Claims and
Equity Interests, whether or not they accept the Plan.
2. Except as otherwise expressly provided in Section 1141 of the Bankruptcy
Code or this Plan, the distributions made pursuant to the Plan will be in
full and final satisfaction, settlement, release and discharge as against
the Debtor or any of its assets or properties, of any debt that arose before
the Confirmation Date and any debt of a kind specified in Sections 502(g),
502(h) or 502(i) of the Bankruptcy Code and all Claims and interests of any
nature, including, without limitation, any interest accrued thereon from and
after the Petition Date, whether or not (i) a proof of Claim or interest
based on such debt, obligation or interest is filed or deemed filed under
Section 501 of the Bankruptcy Code, (ii) such Claim or interest is Allowed
under Section 502 of the Bankruptcy Code, or (iii) the holder of such Claim
or interest has accepted the Plan.
3. Except as set forth herein, on and after the Effective Date, every
holder of a Claim or Equity Interest shall be precluded and permanently
enjoined from asserting against the Debtor, Liquidating Trust (in connection
with is organization, and operations), and the Liquidating Trustees (in
their capacity as such), and Reorganized Crescent City, their respective
officers, directors, professionals and agents or their respective assets or
properties, any further claim based on any document, instrument, judgment,
award, order, act, omission, transaction or other activity of any kind or
nature that occurred prior to the Confirmation Date. Said injunction shall
not be construed to enjoin any action by a Creditor or Bondholder against
the Debtor, Liquidating Trust, the Liquidating Trustees, Reorganized
Crescent City, their respective officers, directors, professionals and
agents which is personal to such person or entity, and which is not
derivative of the rights of the Debtor. Nothing contained herein shall
prevent the Louisiana Department of Revenue and Taxation ("LDRT") from
pursuing any corporate officers/directors of the Debtor, pursuant to LSA-
R.S. 47:1561.1, but only with respect to claims filed in the Bankruptcy
Case.
B. Rights of Action. Any rights or causes of action accruing to the Debtor
shall become assets of Liquidating Trust. Liquidating Trust may pursue
those rights or causes of action as appropriate as set forth in Article V(G)
of the Plan, in accordance with what is in the best interests, and for the
benefit of, those Creditors that will receive distributions from the
Residual Property. It is expressly understood that the Liquidating Trustees
may, in their discretion and by majority vote, settle or resolve any
avoidance action claim by agreeing to permit the transferee to make an
appropriate reduction in its claim(s) so as to give credit for the amount
otherwise recoverable from future distributions pursuant to this Plan.
C. Committees. The Creditors' Committee shall continue in existence until
the Effective Date, to exercise those powers and perform those duties
specified in Section 1103 of the Bankruptcy Code, and shall perform such
other duties as it may have been assigned by the Bankruptcy Court. On the
Effective Date, the Creditors' Committee shall be dissolved and their
members shall be deemed released of all their duties, responsibilities and
obligations in connection with the Bankruptcy Case. Upon dissolution of the
Creditors' Committee, each member of the Creditors' Committee and its
counsel shall be deemed released from liability by the Debtor and any
creditor entitled to receive a distribution under this Plan, and shall be
indemnified by Liquidating Trust from any liability to any creditor, the
debtor, purchaser, equity security holder, the Reorganized Debtor or party
in interest for any act taken in furtherance of its duties as a member of
the Creditors' Committee or its counsel, as applicable.
D. Full and Final Satisfaction. The payments and distributions which are
required to be made by the Debtor or Liquidating Trust under this Plan shall
be in full and final satisfaction, settlement, release and discharge of all
Claims against and Interests in the Debtor. A holder of an Allowed Claim
may not receive a distribution on account of such Allowed Claim equal to an
amount greater than the full amount (including interest to the extent
provided in the Plan) of such Allowed Claim.
E. Post-Confirmation Effect of Evidences of Claims or Interests. Except as
otherwise provided in the Plan, effective upon the Effective Date, all
notes, certificates and other evidences of Claims or Interests shall
represent only the right to participate in distributions under the Plan.
F. Continuation of Injunctions and Stays. Unless otherwise provided, all
injunctions, liens or stays: (a) ordered in the Reorganization Case
pursuant to Sections 105 and 362 of the Bankruptcy Code or otherwise or in
existence on the Petition Date, and (b) extant immediately prior to the
Confirmation Date shall remain in full force and effect until the Effective
Date.
ARTICLE XIII
RELEASE AND EXCULPATION
A. Release. Except for the obligations created by the Plan, for good and
valuable consideration, including, without limitation, the benefits of the
Plan, the promises and obligations of the Debtor, Reorganized Crescent City,
the Bondholders, CGII and the Purchaser and the efforts and contributions of
the officers and directors of the Debtor in bringing about the confirmation
and consummation of the Plan, and to permit the effective and expeditious
reorganization of the Debtor, on the Effective Date, the Debtor, shall be
deemed to have unconditionally waived and released any and all rights,
Claims, liabilities and causes of action with respect to those matters
directly relating to Crescent City, against Reorganized Crescent City, the
Bondholders, the Indenture Trustee, CGII, the Institutional Note Holders'
Steering Committee, the Creditors' Committee, the Purchaser, and except with
respect to CGII, their respective members, officers, directors, agents and
attorneys, as well as the Debtor's officers, directors, agents and
attorneys who served in such capacities at any time during the Bankruptcy
Case (collectively the "Releasees"); provided however, that (a) Purchaser
shall not be released from its obligations under the Magic Agreement to pay
the Magic Deferred Cash, and (b) the releases granted in favor of the
Committees shall release Committee members only in their capacity as such
and not in their capacity as individual creditors. Any claim or cause of
action a Creditor or Bondholder has against any Releasee which is personal
to such Releasee, and which is not derivative of the rights of the Debtor,
shall not be affected by the releases granted hereunder.
Except with respect to the Debtor, nothing in this Plan shall impair or
otherwise affect any rights, liens, claims, or interests of the Indenture
Trustee or any Bondholder under the Notes, the Indenture, or any related
documents, including, but not limited to, any rights, liens, claims or
interests against CGII or any guarantor of CGII's obligations.
ARTICLE XIV
MISCELLANEOUS PROVISIONS
A. Payment Dates. Whenever any payment to be made or action to be taken
under the Plan is due to be made or taken on a day other than a Business
Day, such payment will instead be made (without Interest for such delay) or
action will instead be taken on the next Business Day.
B. [INTENTIONALLY LEFT OUT]
C. Governing Law. Unless a rule or procedure is supplied by federal law
(including the Bankruptcy Code and Bankruptcy Rules), the laws of the State
of Louisiana shall govern the construction and implementation of the Plan
and any agreements, documents and instruments executed in connection with
the Plan.
D. Binding Effect. The rights, duties and obligations of any person or
entity named or referred to in the Plan shall be binding upon and shall
inure to the benefit of, such person or entity and their respective
successors and assigns.
E. Filing or Execution of Additional Documents. Except as otherwise
provided in the Plan, on or before substantial consummation of the Plan, the
Debtor will file with the Bankruptcy Court or execute, as appropriate, such
agreements and other documents as may be necessary or appropriate to
effectuate and further evidence the terms and conditions of the Plan.
F. Payment of Statutory Fees. All fees payable pursuant to Section 1930 of
title 28, United States Codes, 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.
G. Revocation and Modification of Plan and Related Documents. The Debtor
reserves the right, in accordance with the Bankruptcy Code, to amend or
modify the Plan and related Plan Documents in any manner or revoke the Plan
in its entirety prior to the entry of the Confirmation Order. After entry
of the Confirmation Order, the Debtor may: (a) amend or modify the Plan and
related Plan Documents in accordance with, and to the extent permitted by,
Section 1127(b) of the Bankruptcy Code; or (b) remedy any defect or omission
or reconcile any inconsistency in the Plan in such manner as may be
necessary to carry out the purpose and intent of the Plan. In the event the
Plan is confirmed but cannot be consummated, the Confirmation Order shall be
revoked and upon such revocation, the terms of the Plan shall not be binding
on or enforceable by any Person.
H. Notices. Any notice required or permitted under the Plan shall be in
writing and served either by (i) certified mail, return receipt requested,
postage pre-paid, (ii) hand delivery, or (iii) reputable overnight delivery
service, freight prepaid, addressed to the following parties:
If to the Debtor:
Crescent City Capital Development Corp.
Bayport One, Suite 250
8025 Black Horse Pike
W. Atlantic City, New Jersey 08232
Attn: President
with a copy to:
Bronfin & Heller, LLC
650 Poydras Street, Suite 2500
New Orleans, Louisiana 70130
Attn: Jan. M. Hayden, Esq.
If to Liquidating Trust:
with a copy to:
I. Construction. The rules of construction set forth in Section 102 of the
Bankruptcy Code shall apply to the construction of the Plan.
J. Section Headings. The section headings contained in the Plan are for
convenience and reference purposes only and will not affect in any way the
meaning or interpretation of the Plan.
K. Offer of Compromise. The Compromise embodied in this Plan shall not be
deemed to be an admission of liability of the Debtor, the Debtor-in-
Possession or Liquidating Trust, and shall not be admissible in any
proceeding or action, other than one to enforce the provisions of this Plan,
against the Debtor, as a debtor and debtor-in-possession, or the Indenture
Trustee or Bondholders.
ARTICLE XV
TRANSACTION WITH PURCHASER
A. Notwithstanding any provision to the contrary contained in the Plan, the
provisions of this Article shall govern the performance and effect of the
consummation of the Magic Agreement in lieu of any other provision in the
Plan which may conflict with this Article.
B. Upon the payment to the Indenture Trustee of the Magic Closing Cash and
the Magic Notes as provided in Article II(A), Purchaser shall be discharged
from any further liability to the Debtor for the payment of said sum, not
including the Magic Deferred Cash. The breach by the Indenture Trustee of
any of its obligations under the Plan including but not limited to making
specified disbursements shall not affect Purchaser in any manner, and
Purchaser shall be entitled to full performance (including specific
performance) by the Debtor under the Plan and the Magic Agreement.
C. The obligations to assume or satisfy the claims of Bally, IGT or any
other vendor as provided in Paragraph 4 of the Magic Agreement shall not
exceed an aggregate amount of $6,500,000.00.
D. All conditions to Closing as defined in Paragraph 5 of the Magic
Agreement must either be satisfied or waived in writing by Purchaser prior
to the Closing occurring.
E. All obligations of Purchaser under the Magic Agreement and the Plan
shall be governed by applicable federal law and the law of the State of
Louisiana.
F. The Liquidating Trust shall be responsible for all claims, obligations,
liabilities, liens or taxes which arise or accrue prior to the Effective
Date. Neither Purchaser nor the Reorganized Crescent City shall be liable
or in any manner responsible for those claims, obligations, liabilities,
liens or taxes which arise or accrue prior to the Effective Date. All
parties pursuant to section 1141 will be enjoined from asserting any such
claims, obligations, liabilities, liens or taxes against the Reorganized
Crescent City or the Purchaser, and the Reorganized Crescent City shall be
discharged from all such claims, obligations, liabilities, liens or taxes.
Except as otherwise provided herein, all Riverboat Assets of the Reorganized
Crescent City shall be revested in the Reorganized Crescent City free and
clear of all liens and/or encumbrances of any manner whatsoever.
G. Taxes and Section 338(h)(10) Election. All of the tax benefits and tax
obligations of Debtor arising prior to the Effective Date shall be for the
account of the Debtor and shall be satisfied, discharged or otherwise
provided for by the Liquidating Trust. The Liquidating Trust or CGII will
be responsible for filing all federal, state and local tax returns through
all relevant time periods until the Effective Date. Purchaser will co-
operate with CGII and the Liquidating Trust to file Form 8023, to effectuate
the election by the Debtor and CGII under section 338(g) and 338(h)(10) of
the Internal Revenue Code.
1. With respect to the sale of the Shares, if so requested by the Debtor
upon notice to Purchaser prior to the Closing Date, Debtor and Purchaser
shall jointly make a Section 339(h)(10) Election (as hereinafter defined) in
accordance with applicable laws and under any comparable provision of state
or local law for which a separate election is permissible and as set forth
herein. The Purchaser shall take all necessary steps to properly make a
Section 338(g) Election (as hereinafter defined) in connection with the
Section 338(h)(10) Election in accordance with applicable laws and under any
comparable provision of state or local law for which a separate election is
permissible. The Purchaser and Debtor agree to cooperate in good faith with
each other in the preparation and timely filing of any tax returns required
to be filed in connection with the making of such an election, including the
exchange of information and the joint preparation and filing of Form 8023
and related schedules.
2. The Debtor shall be responsible for the preparation and filing of all
Section 388 Forms (as hereinafter defined) in accordance with applicable tax
laws and the terms of this Agreement and shall deliver such Section 338
Forms to Purchaser at least 30 days prior to the date such Section 338 Forms
are required to be filed. Purchaser shall execute and deliver to the Debtor
such documents or forms (including executed Section 338 Forms) as are
requested and are required by any laws in order to properly complete the
Section 338 Forms at least 20 days prior to the date such Section 338 Forms
are required to be filed.
3. The Purchase Price, liabilities of the Companies and other relevant
items shall be allocated in accordance with Section 338(b)(5) of the Code
and the Treasury Regulations thereunder.
4. "Section 338 Forms" means all returns, documents, statements, and other
forms that are required to be submitted to any federal, state or local
taxing authority in connection with a Section 338(g) Election or a Section
338(h)(10) Election. Section 338 Forms shall include, without limitation,
any "statement of section 338 election" and IRS Form 8023 (together with any
schedules or attachments thereto) that are required pursuant to Treas. Regs.
Section 1.338-1 or Treas. Regs. Section 1.338(h)(10)-1 or any successor
provisions.
5. "Section 338(g) Election" means an election described in Section 338(g)
of the Code in connection with an election under Section 338(h)(10) of the
Code with respect to the acquisition of Shares pursuant to this Agreement.
Section 338(g) Election shall include any corresponding election under any
other relevant tax laws (e.g., state laws) for which a separate election is
permissible with respect to the Purchaser's acquisition of Shares pursuant
to this Agreement.
6. "Section 338(h)(10) Election" means an election described in Section
338(h)(10) of the Code with respect to the Purchaser's acquisition of Shares
pursuant to this Agreement. Section 338(h)(10) Election shall include any
corresponding election under any other relevant tax laws (e.g., state laws
for which a separate election is permissible with respect to the Purchaser's
acquisition of Shares pursuant to this Agreement.
7. Purchaser acknowledges that, in the absence of an effective election
under Section 338(h)(10) of the Code, CGII will make any otherwise permitted
election under Treas. Reg. Sec. 1.1502-20(g) with respect to the Debtor.
Purchaser agrees to cooperate with CGII in meeting the requirements of such
election, including causing the Debtor to comply with Treas. Regs. Sec.
1.1502-20(g)(5).
Dated: New Orleans, Louisiana
March 15, 1996
CRESCENT CITY CAPITAL
DEVELOPMENT CORPORATION
By: /s/ EDWARD M. TRACY
-------------------------
Name: Edward M. Tracy
Title: President and CEO
BRONFIN & HELLER, LLC
Counsel to Debtor
By: /s/ ROBYN J. SPALTER
--------------------------
Jan M. Hayden (Law Bar #6672)
Robyn J. Spalter (Law Bar #21116)
650 Poydras Street, Suite 2500
New Orleans, Louisiana 70130-6101
(504) 568-1888