IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF DELAWARE
In re: ) Chapter 11
)
WHEREHOUSE ENTERTAINMENT, INC., ) Case No. 95-911(HSB)
and WEI HOLDINGS, INC., )
) Jointly Administered
Debtors. )
FINDINGS OF FACT, CONCLUSIONS OF LAW AND ORDER
CONFIRMING DEBTORS' FIRST AMENDED CHAPTER 11
PLAN UNDER CHAPTER 11 OF THE BANKRUPTCY CODE
---------------------------------------------
Wherehouse Entertainment, Inc. ("Wherehouse") and WEI
Holdings, Inc. ("Holdings" and together with Wherehouse, the
"Debtors") having filed their First Amended Chapter 11 Plan, as
revised for technical corrections on October 4, 1996 and
supplemental amendments on December 2, 1996 and December 13, 1996
(as amended, the "Plan" attached hereto as Exhibit A, together
with the amendments attached hereto as Exhibits B and C)(1); and
_______
(1) All capitalized terms used herein and not otherwise defined
shall have the respective meanings assigned to them in the Plan.
the Debtors having filed their Disclosure Statement with respect
to the Plan on October 4, 1996; and a hearing (the "Disclosure
Statement Hearing") to consider the adequacy of the Disclosure
Statement having been scheduled for and taken place on
November 4, 1996; and the United States Bankruptcy Court for the
District of Delaware (the "Bankruptcy Court") having approved the
Disclosure Statement as amended prior to the Disclosure Statement
Hearing and modified at the Disclosure Statement Hearing (the
"Disclosure Statement"), by order dated November 4, 1996
("Disclosure Statement Order"); and the Disclosure Statement
Order having, inter alia, (1) established procedures for the
solicitation and the tabulation of votes with respect to the
Plan, (2) approved the form of ballot for the acceptance or
rejection of the Plan; (3) fixed December 3, 1996 at 4:00 p.m.,
Eastern Standard Time, as the date and time for filing objections
to the Plan; (4) fixed December 9, 1996 at 5:00 p.m. Pacific
Standard Time as the date and time by which all ballots accepting
or rejecting the Plan must be received in order to be counted;
and (5) fixed December 13, 1996 at 10:00 a.m., Eastern Standard
Time, as the date and the time for commencement of the hearing
pursuant to Section 1129 of the Bankruptcy Code to consider
confirmation of the Plan ("Confirmation Hearing"); and the Plan,
the Disclosure Statement, the Disclosure Statement Order and
various related materials having been transmitted to holders of
Claims and Interests and other parties in interest in these
Chapter 11 cases as provided for in the Disclosure Statement
Order, along with a ballot to the holders of Claims and Interests
entitled to vote on the Plan; and the solicitation of acceptances
from holders of Claims and Interests entitled to vote on the Plan
having been made within the time and in the manner required by
the Disclosure Statement Order; and the Debtors having filed with
the Court and served upon all required persons their Schedule of
Certain Real Property Leases and Executory Contracts to be
Assumed dated December 3, 1996 (the "Schedule of Assumed
Contracts") as contemplated by Article 7.02 of the Plan; and the
ballots having been received and tabulated by Poorman-Douglas
Corporation, designated balloting agent for the Debtors; and
affidavits of service reflecting that service has occurred in
accordance with the procedures established by the Disclosure
Statement Order having been filed with the Court; and objections
(the "Objections") to the confirmation of the Plan having been
filed by: (i) the Official Committee of Unsecured Creditors,
which objection was withdrawn at the Confirmation Hearing subject
to the Second Amendment described below, (ii) United States Trust
Company of New York, as indenture trustee for holders of Senior
Subordinated Notes ("U.S. Trust"), which objection was withdrawn
at the Confirmation Hearing subject to the Second Amendment
described below, (iii) the State of Nevada, Department of
Taxation, which objection was subsequently withdrawn pursuant to
the Stipulation re: Settlement of Claim filed on December 11,
1996, (iv) the Iowa Department of Revenue and Finance, which
objection was subsequently withdrawn prior to the Confirmation
Hearing by agreement, (v) the Internal Revenue Service, which
objection was withdrawn prior to the Confirmation Hearing by
agreement, (vi) Rouse Company Affiliates, the Equitable Life
Assurance Society of the United States, Macerich Property
Management Company, Urban Retail Properties Company, Plaza
Properties, Hahn Company, Irvine Company and Haagan (the "Rouse
Objection"), (vii) The George Sorich Company, which objection was
withdrawn prior to the Confirmation Hearing, (viii) George
Killian, D/B/A Killian Pacific, which objection was withdrawn
prior to the Confirmation Hearing, (ix) Equitable Life Assurance
Society of America, Yarmouth Capital Partners and U.S. Prime
Properties, Inc., which objection was withdrawn prior to the
Confirmation Hearing, (x) Burnham Pacific Properties, which
objection was withdrawn prior to the Confirmation Hearing,
(xi) Encino Valley Shopping Center Ltd., which objection was
withdrawn prior to the Confirmation Hearing, (xii) Allen Family
Trust, which objection was withdrawn prior to the Confirmation
Hearing and (xiii) Mellon USL Leasing, which objection was
withdrawn prior to the Confirmation Hearing; and the Confirmation
Hearing having been held on December 13, 1996; and the Court
having considered all of the Objections to the confirmation of
the Plan, the entire record of these Chapter 11 cases, the record
taken before the Court at the Confirmation Hearing, all of the
evidence adduced at the Confirmation Hearing (including testimony
and exhibits admitted into evidence), the Debtors' and the Senior
Lenders' Memoranda in Support of Confirmation of the Plan, the
submissions, including offers of proof, at the Confirmation
Hearing, the arguments and representations of counsel and all
pleadings and proceedings herein, the Court makes the following
Findings Fact and Conclusions of Law setting forth the reasons
for the Court's issuance of this Order confirming the Plan,
overruling the outstanding Objection, and granting the other
relief provided for herein:
THE COURT HEREBY MAKES THE FOLLOWING FINDINGS:(2)
(2) This Order constitutes the Bankruptcy Court's findings
of fact and conclusions of law under Rule 52 of the
Federal Rules of Civil Procedure, as made applicable by
Rules 7052 and 9014 of the Federal Rules of Bankruptcy
Procedure (the "Bankruptcy Rules"). Each of the above
findings constitutes a finding of fact if it constitutes
a finding of fact and a conclusion of law if it constitutes
a conclusion of law.
1. This is a core proceeding within the meaning of 28
U.S.C. Section 157.
2. The Debtors filed voluntary petitions for relief under
Chapter 11 of the Bankruptcy Code on August 2, 1995 (the
"Petition Date"). An order for joint administration pursuant to
Bankruptcy Rule 1015(b) has been entered in the Chapter 11 cases.
3. Since the Petition Date, the Debtors have been
operating their businesses and managing their affairs as debtors
and debtors in possession pursuant to sections 1107 and 1108 of
the Bankruptcy Code. No trustee or examiner has been appointed
in either of the Chapter 11 cases.
4. On August 14, 1995, the United States Trustee for the
District of Delaware appointed the Official Committee of
Unsecured Creditors of the Debtors (the "Official Committee")
which currently consists of: (i) PolyGram Group Distribution,
Inc., (ii) United States Trust Company of New York, (iii) Romulus
Holdings, Inc., (iv) Warner/Elektra/Atlantic Corporation,
(v) Northeast Investors Trust, (vi) BMG Distribution and
(vii) Dabney/Resnick Asset Management Inc.
5. On November 4, 1996, the Court approved the Disclosure
Statement, including certain matters referred to on the record at
the Disclosure Statement Hearing, which matters were then
reflected in the Disclosure Statement as subsequently filed with
the Court and distributed in accordance with the Disclosure
Statement Order. The procedures by which the ballots for
acceptance or rejection of the Plan were distributed and
tabulated were properly conducted and in accordance with the
Disclosure Statement Order.
6. Notice of the time for filing objections to
confirmation of the Plan and the Confirmation Hearing was given
in accordance with Bankruptcy Rule 2002(b)(2); the form and scope
of the notice were appropriate under the circumstances; and all
parties in interest had an opportunity to appear and be heard at
the Confirmation Hearing.
7. As of the date of the Confirmation Hearing, the Plan
was accepted by all Classes entitled to vote to accept or reject
the Plan both as to number and amount, with the exception of
Class 2 (which did not vote on the Plan) and Class 7, in
accordance with section 1126 of the Bankruptcy Code, and a
certification to that effect (the "Ballot Certification") has
been filed with this Court. The Ballot Certification is hereby
approved and found to accurately reflect the result of the
balloting as of the date of the Confirmation Hearing.
8. On December 3, 1996, the Debtors, the Official
Committee, the Trade Committee, U.S. Trust and the Bank Agent
executed the Stipulation to Amend Plan of Reorganization (the
"Plan Stipulation") and the Debtors filed and served on the
required parties the Supplemental Amendments to the Debtors'
First Amended Chapter 11 Plan dated December 2, 1996 (the "First
Amendment," attached hereto as Exhibit B).
9. The First Amendment complies with Section 1127 of the
Bankruptcy Code and Bankruptcy Rule 3019, does not adversely
change the treatment of any Claim or Interest other than the
Senior Lenders, who consented to the amendment, and the form and
scope of notice of the First Amendment were appropriate under the
circumstances.
10. At the Confirmation Hearing, an agreement was reached
by certain parties in this case regarding certain modifications
to the Plan and certain settlements, which agreement was read
into the record at the Confirmation Hearing and is reflected in
the Second Amendment to the Plan dated December 13, 1996 (the
"Second Amendment to the Plan," attached hereto as Exhibit C) and
as further set forth herein.
11. The Second Amendment complies with Section 1127 of the
Bankruptcy Code and Bankruptcy Rule 3019, does not materially
adversely change the treatment of any Claim or Interest and the
form and scope of notice of the Second Amendment was appropriate
under the circumstances.
12. The Official Committee and U.S. Trust withdrew their
objections to the Plan upon the parties reaching agreement
regarding the Second Amendment at the Confirmation Hearing.
13. To the extent any Holder of a Senior Subordinated Note
Claim submits an affidavit requesting to change its vote
rejecting the Plan to a vote accepting the Plan (a "Vote Change
Affidavit"), good cause exists to grant such request and such
request otherwise satisfies Bankruptcy Rule 3018.
14. Article 4 of the Plan designates eight Classes of
Claims and one Class of Interests. Article 6 of the Plan
specifies that Claims in Class 3 and 4 are not Impaired and that
Claims in Classes 1, 2, 5, 6, 7 and 8 and Interests in Class 9
are Impaired.
15. Article 5 of the Plan specifies the treatment of all
Classes of Claims and Interests under the Plan.
16. The Plan provides the same treatment for each Claim or
Interest of a particular Class.
17. The classification of Claims and Interests under the
Plan is consistent with Section 1122 of the Bankruptcy Code, is
reasonable and not discriminatory.
18. Article 9 of the Plan specifies that the Plan shall be
implemented by the substantive consolidation of the Estates,
transferring the property of the Estates to Reorganized
Wherehouse on the Effective Date pursuant to the Asset Purchase
Agreement and the liquidation of the Estates. Article 10 of the
Plan provides for the distribution of property by Reorganized
Wherehouse in accordance with the Plan. The Plan provides
adequate means for the execution and implementation of the Plan
and otherwise complies with Section 1123(a)(5) of the Bankruptcy
Code.
19. Section 14.03 of the Plan and the Certificate of
Incorporation of Reorganized Wherehouse filed as an Exhibit to
the Plan include provisions prohibiting the issuance of nonvoting
equity securities and otherwise comply with Section 1123(a)(6) of
the Bankruptcy Code.
20. Section 8.02 of the Plan provides for the selection of
directors of Reorganized Wherehouse, which directors were
designated in a Schedule of Initial Members of the Board of
Directors for Reorganized Wherehouse filed by the Senior Lenders
on December 6, 1996 and served on parties requesting notice, and
the selection of the directors of Reorganized Wherehouse complies
with Bankruptcy Code section 1123(a)(7).
21. The Plan complies with the applicable provisions of the
Bankruptcy Code as required by section 1129(a)(1) thereof, and
the Debtors, as proponents of the Plan, have complied with the
applicable provisions of the Bankruptcy Code as required by
Section 1129(a)(2) thereof.
22. The Plan has been proposed in good faith and not by any
means forbidden by law as required by Section 1129(a)(3).
23. All payments made or promised by the Debtors for
professional services or for costs and expenses in or in
connection with the Plan and incident to these Chapter 11 cases
have been disclosed to the Court and any such payments made by
the Debtors before confirmation has been approved by the Court as
reasonable or, if such payments are to be fixed after
confirmation of the Plan, such payments are subject to the
approval of this Court as reasonable.
24. In accordance with Section 1129(a)(5) of the Bankruptcy
Code, the identity and affiliations of the individuals proposed
to serve, after confirmation of the Plan, as directors and
officers of Reorganized Wherehouse has been disclosed; and the
continuance in or appointment of such office of such individuals
is consistent with the interests of creditors and equity interest
holders in these Chapter 11 cases and with public policy; and the
identity of any insider presently known that will be employed or
retained by Reorganized Wherehouse and the nature of any
compensation to such insider has been disclosed.
25. There are no governmental regulatory commissions with
jurisdiction over the rates of the Debtors, and therefore,
Section 1129(a)(6) of the Bankruptcy Code is inapplicable.
26. No holder of an Impaired Claim or Interest will receive
or retain under the Plan on account of such Claim or Interest
property of a value, as of the Effective Date, that is not less
than the amount that such holder would so receive or retain if
the Debtors were liquidated under Chapter 7, and the Plan
complies with Section 1129(a)(7) of the Bankruptcy Code.
27. With respect to Classes 1, 5, and 6 of the Plan, the
Plan has been accepted by at least two-thirds in amount and more
than one half in number of the holders of Claims in such Classes.
Classes 8 and 9 receive no distribution of property under the
Plan and are deemed to have rejected the Plan. Classes 3 and 4
are not Impaired and therefore are not entitled to vote on the
Plan. As of the Confirmation Date, Class 7 voted to reject the
Plan. The sole Holder of a Claim in Class 2 did not vote in the
Plan, but that Claim was satisfied in full prior to the
Confirmation Hearing as set forth in Finding 35 below.
28. The treatment of Claims under the Plan of the type
specified in Sections 507(a)(1), 507(a)(2), 507(a)(3), 507(a)(4),
507(a)(5), 507(a)(6), 507(a)(7) and 507(a)(8) of the Bankruptcy
Code complies with the provisions of Section 1129(a)(9) of the
Bankruptcy Code.
29. Classes 1, 5 and 6 of the Plan have accepted the Plan,
as determined without including any acceptance of the Plan by any
insider holding a Claim in such Class, and the Plan complies with
Section 1129(a)(10) of the Bankruptcy Code.
30. The Plan is feasible and the Debtors have demonstrated
that there is a reasonable prospect of their being able to meet
their financial obligations under the Plan and their businesses
in the ordinary course; confirmation of the Plan is not likely to
be followed by the liquidation or need for further financial
reorganization of the Debtors, and the Plan otherwise complies
with Section 1129(a)(11) of the Bankruptcy Code.
31. All fees due and owing under Section 1930 of the
Judicial Code; 28 U.S.C. Section 1930, have been paid or will be
paid on or before the Effective Date, and the Plan otherwise
complies with Section 1129(a)(12) of the Bankruptcy Code.
32. Section 14.05 of the Plan provides for the continuation
after the Effective Date of all retiree benefits consistent with
Section 1129(a)(13) of the Bankruptcy Code.
33. Section 5.01(f) of the Plan provides that the Holders
of Allowed Senior Lender Secured Claims shall purchase from
Eligible Suppliers that have timely executed the Exchange Option
the New Common Stock received by such Eligible Supplier for cash
in the amount of 27% of such Eligible Supplier's Allowed General
Unsecured Claim (net of Reclamation Claims and returns under
Section 546(g)* of the Bankruptcy Code as provided in the Plan).
34. The Exchange Option set forth in the Plan is provided
by the Senior Lenders, the cash distributed to Eligible Suppliers
is property of the Senior Lenders and the Exchange Option does
not constitute treatment by the Debtors under the Plan. The
Exchange Option does not violate Section 1123(a)(4) of the
Bankruptcy Code and the Plan otherwise complies with Section
1123(a)(4) of the Bankruptcy Code.
35. The Class 2 DC-2 Secured Claim was paid in full by the
Debtors prior to the Confirmation Hearing from the proceeds of
the sale of the property securing such Claim in accordance with
the Order Approving (A) Sale of DC-2 Property, (B) Assumption and
Assignment of Unexpired Lease thereof and (C) Postpetition
Payment of Debt Secured Thereby dated November 4, 1996.
36. All other requirements of Section 1129(a) and (b) of
the Bankruptcy Code have been satisfied or otherwise are
inapplicable to the Debtors and the Plan.
37. The settlement of the amount of the Senior Lender
Secured Claims set forth in the Plan is fair and reasonable, is
entered into in good faith and is in the best interests of the
Debtors and the Estates, and otherwise satisfies the requirements
of Bankruptcy Rule 9019.
38. The releases by the Debtors and Debtors in Possession
contained in Section 12.04 of the Plan are fair and reasonable,
are entered into in good faith, are in the best interests of the
Debtors and the Estates and otherwise satisfy the requirements of
Bankruptcy Rule 9019.
39. The releases by the Release Obligors contained in
Section 12.05 of the Plan are fair and reasonable, are entered
into in good faith, are in the best interests of the Debtors and
the Estates and otherwise satisfy the requirements of Bankruptcy
Rule 9019.
40. The settlement of the Acquisition Related Causes of
Action set forth in Section 12.09 of the Plan is fair and
reasonable, is entered into in good faith and is in the best
interests of the Debtors and the Estates, otherwise satisfies the
requirements of Bankruptcy Rule 9019, and constitutes a good
faith compromise and settlement of the Acquisition Related Causes
of Action pursuant to Bankruptcy Rule 9019 and all applicable
state laws, including the States of Delaware, California and New
York, given and made after due notice and opportunity for
hearing.
41. The Deferred Purchase Price Settlement set forth in
Section 12.10 of the Plan is fair and reasonable, is entered into
in good faith, is in the best interests of the Debtors and the
Estates, otherwise satisfies the requirements of Bankruptcy Rule
9019 and constitutes a good faith compromise and settlement of
the Causes of Action settled therein pursuant to Bankruptcy Rule
9019 and all applicable state laws, including the States of
Delaware, California and New York, given and made after due
notice and opportunity for hearing.
42. The McMahan Settlement set forth in Section 12.10 of
the Plan is fair and reasonable, is entered into in good faith,
is in the best interests of the Debtors and the Estates,
otherwise satisfies the requirements of Bankruptcy Rule 9019 and
constitutes a good faith compromise and settlement of the Actions
(as defined in the McMahan Settlement) settled therein pursuant
to Bankruptcy Rule 9019 and all applicable state laws, including
the States of Delaware, California and New York.
43. The terms and conditions of the Asset Purchase
Agreement were negotiated by the parties at arms length and in
good faith, the terms of the Asset Purchase Agreement are fair
and reasonable, entering into the Asset Purchase Agreement is in
the best interests of the Debtors and the Estates and is
necessary for the implementation of the Plan, and the
transactions contemplated thereunder shall be deemed to have been
entered into in good faith and for good and valuable
consideration. The execution of the Asset Purchase Agreement by
the Debtors complies with Section 363 of the Bankruptcy Code, and
Reorganized Wherehouse is a good faith purchaser within the
meaning of, and subject to the protections and benefits of
Section 363(m) of the Bankruptcy Code.
44. It appears that the Debtors will satisfy each and every
condition precedent to the effectiveness of the Plan as set forth
in Article 13 of the Plan.
45. The Debtors have reviewed their executory contracts and
unexpired leases, and it is a reasonable exercise of the Debtors'
business judgment for them to assume and assign to Reorganized
Wherehouse the leases and contracts listed on the Schedule of
Assumed Contracts and to reject all such executory contracts and
unexpired leases other than those listed on the Schedule of
Assumed Contracts, previously assumed or rejected by the Debtors
or that are the subject of the Debtors' Motion for Entry of Order
Approving Assumption of Unexpired Real Property Leases and
Executory Contracts Conditioned on Confirmation and Effectiveness
of the Debtors' First Amended Chapter 11 Plan and Rejecting
Remaining Unexpired Real Property Leases filed on December 13,
1996 (the "Pending Assumption Motion"). The assumption and
rejection of leases and executory contracts pursuant to Article 7
of the Plan is the result of the sound business judgment by the
Debtors, and is in the best interests of the Debtors and the
Estates. The assumption and rejection of executory contracts and
unexpired leases under the Plan complies with Section 365 of the
Bankruptcy Code. This Court's finding that the Plan complies
with Section 1129(a)(11) of the Bankruptcy Code constitutes a
finding that adequate assurance of future performance shall be
provided to any party to a contract or assumed by the Debtors and
assigned to Reorganized Wherehouse under the Plan or otherwise.
46. The Debtors served their Motion for Order Authorizing
Payment of Deposit Fee Necessary to Obtain Post-Confirmation
Financing on November 15, 1996 (as amended, the "Post-
Confirmation Financing Motion"), which motion, as amended
pursuant to a stipulation dated as of November 25, 1996, was
approved by the Court. The terms of the financing between
Reorganized Wherehouse and Congress Financial Corporation
(Western) ("Congress"), set forth in the Post-Confirmation
Financing Motion, provides for a revolving credit facility in the
amount of $30 million (the "Working Capital Facility") and such
other instruments, documents, certificates, opinions and
assurances as Congress may request in connection with the Working
Capital Facility (collectively, the "Working Capital Facility
Documents"). The negotiation by the parties of the Working
Capital Facility and the Working Capital Facility Documents on
substantially the terms set forth in the Post-Confirmation
Financing Motion has been in good faith and at arms-length and
without intent to hinder, to delay or to defraud the Debtors, any
creditor of the Debtors or Reorganized Wherehouse. Entering into
the Working Capital Facility Documents is in the best interests
of the Debtors, the creditors of the Debtors, Reorganized
Wherehouse and their respective estates and is necessary for the
implementation of the Plan, and the transactions contemplated
under the Working Capital Facility Documents shall be deemed to
have been entered into in good faith and for good and valuable
consideration. The execution of the Working Capital Facility
Documents by Reorganized Wherehouse complies with Section 364 of
the Bankruptcy Code, and Congress is a good faith lender within
the meaning of and subject to the protections and benefits of
Section 364(e) of the Bankruptcy Code.
47. The Debtors, Reorganized Wherehouse, Congress and all
other parties in interest (including, but not limited to A&S and
the A&S Released Parties) will be acting in good faith if they
proceed to consummate the Plan and the agreements, settlements,
transactions and transfer contemplated thereby and to take the
action authorized by this action, notwithstanding an appeal of
this Order, so long as no stay was issued pending appeal, even if
they act with knowledge of the pendency of that appeal.
48. The primary purpose of the Plan is not the avoidance of
taxes or the avoidance of the application of Section 5 of the
Securities Act of 1933.
49. Based on the Debtors' relative financial positions,
historic manner of operation, treatment of the Debtors by their
creditors and for the other reasons set forth in the Disclosure
Statement, substantive consolidation of the Debtors is
appropriate, fair and equitable and non-discriminatory to all
Holders of Claims and Interests.
50. Reorganized Wherehouse constitutes a "successor to the
debtor" for purposes of Sections 1123, 1129 and 1145 of the
Bankruptcy Code.
Now, upon the motion of the Debtors and after due
deliberation, the Court hereby ORDERED, ADJUDGES AND DECREES
THAT:
1. The findings of facts and the conclusions of law
set forth above are hereby incorporated and shall be, and hereby
are, an order of this Court.
2. The Plan is hereby (a) incorporated herein by
reference as if fully set forth at length and (b) confirmed in
all respects; to the extent there is any conflict between the
Plan and this Order, the terms of the Plan shall control.
3. The Rouse Objection is overruled. All withdrawn
Objections are hereby deemed withdrawn with prejudice. All
Objections that have not been withdrawn, determined to be moot,
or otherwise disposed of, are overruled.
4. The record of the Confirmation hearing is hereby
closed, except to the extent Vote Change Affidavits are submitted
by Holders of Senior Subordinated Note Claims.
5. Any and all Vote Change Affidavits are hereby
approved pursuant to Bankruptcy Rule 3018, and such votes are
changed to acceptances of the Plan.
6. The Debtors and Reorganized Wherehouse (and their
respective officers) and all parties in interest herein are
hereby authorized, empowered and directed to take, or cause to be
taken, any and all actions, and to execute all documents, which
may be required, necessary or appropriate to enable them to
consummate this Order, implement effectively the provisions of
the Plan and all transactions related thereto, including, without
limitation, those acts specifically authorized herein.
7. Reorganized Wherehouse is authorized and directed
to execute the New Certificate of Incorporation, substantially in
the form of Exhibit C to the Plan, and to file the New
Certificate of Incorporation with the Secretary of State of
Delaware, and the New Certificate of Incorporation is approved in
all respects.
8. Reorganized Wherehouse is authorized and directed
to adopt the New Bylaws substantially in the form of Exhibit B to
the Plan, and the New Bylaws are approved in all respects.
9. The Warrant Agreements, as set forth in
Exhibits E, F and G to the Plan are approved in all respects.
10. Reorganized Wherehouse is authorized and directed
to execute the Warrant Agreements, and upon execution and
delivery of the Warrant Agreements in accordance with the Plan,
the Warrant Agreements shall be the legal, valid and binding
obligations of Reorganized Wherehouse, enforceable against
Reorganized Wherehouse in accordance with their terms, and the
Warrants shall be the legal, valid and binding obligations of
Reorganized Wherehouse, enforceable against Reorganized
Wherehouse in accordance with the terms of the Warrant
Agreements.
11. Reorganized Wherehouse is authorized to issue the
Warrants.
12. Reorganized Wherehouse is authorized to issue the
shares of New Common Stock provided for in the New Certificate of
Incorporation, including, without limitation, the number of
shares to be issued pursuant to the Plan, the number of shares
issuable upon exercise of the Warrants and the number of shares
issuable upon exercise of any management options.
13. In accordance with the Plan, on the Effective
Date: (i) the Chapter 11 Case and Estate of Holdings shall be,
and hereby are, substantively consolidated with and into the
Chapter 11 Case and Estate of Wherehouse, (ii) any and all Claims
against Holdings shall be, and hereby are, deemed to be Claims
against Wherehouse, and (iii) any and all Claims against Holdings
and Wherehouse shall be, and hereby are, satisfied in accordance
with the terms of the Plan.
14. On the Effective Date and pursuant to the
substantive consolidation effected by the Plan, (i) any and all
Claims between the Debtors shall be, and hereby are,
extinguished, (ii) any and all Interests in Wherehouse of which
Holdings is the Holder shall be, and hereby are, cancelled, and
(iii) any Claim against one of the Debtors which the other Debtor
has guaranteed or as to which the other Debtor is liable, jointly
or otherwise, shall be, and hereby are, disallowed and
extinguished as necessary to avoid duplication and so as to
result in one Claim against the consolidated Debtors.
15. On the Effective Date, all of the property of the
Estates remaining after giving effect to the substantive
consolidation pursuant to Sections 9.01, 9.02 and 9.03 of the
Plan shall be, and hereby is, deemed transferred to Reorganized
Wherehouse (except (i) the New Common Stock and Warrants and all
other consideration delivered to the Estates by Reorganized
Wherehouse pursuant to the Asset Purchase Agreement and (ii) any
property of the Estates that is transferred to any other Entity
on or prior to the Effective Date or that is abandoned or Causes
of Action that are being released pursuant to the Plan), and
title to all property so transferred to Reorganized Wherehouse
shall pass to Reorganized Wherehouse on the Effective Date on the
terms and conditions set forth in the Asset Purchase Agreement,
free and clear of all Claims, all liens securing Claims and all
Interests, except any lien preserved under Section 5.03(a) of the
Plan. Reorganized Wherehouse shall not be liable or responsible
for any Claim against the Debtors or the Estates or any
obligation of the Debtors or the Estates except as expressly
assumed by Reorganized Wherehouse in the Asset Purchase Agreement
or pursuant to the Plan. Reorganized Wherehouse shall be, and
hereby is, deemed the successor to the Debtors for the purposes
of Sections 1123, 1129 and 1145 of the Bankruptcy Code.
16. The transfer of assets pursuant to the Asset
Purchase Agreement and the Plan is hereby approved in all
respects.
17. The Debtors and Reorganized Wherehouse are
authorized and directed to execute and deliver the Asset Purchase
Agreement, substantially in the form of Exhibit A to the Plan,
and upon execution and delivery, the Asset Purchase Agreement
shall be the legal, valid and binding obligation of the Debtors
and Reorganized Wherehouse enforceable against the Debtors and
Reorganized Wherehouse in accordance with its terms. Reorganized
Wherehouse is a good faith purchaser within the meaning of, and
subject to the protections and benefits of Section 363(m) of the
Bankruptcy Code.
18. After the Plan becomes effective, the Estates
shall be liquidated in accordance with the Plan and applicable
law. Subject to any further order of the Bankruptcy Court,
Reorganized Wherehouse shall act as liquidating agent of and for
the Estates from and after the Effective Date and as such is
hereby both authorized and obligated, as agent for and on behalf
of the Estates, to admit, object to or contest any and all
Claims, to defend, protect and enforce any and all rights and
interests, to make any and all distributions required or
permitted to be made under the Plan, to file any and all reports,
requests for relief or opposition thereto, and to take any and
all other actions necessary or appropriate to implement the Plan
or to wind up the Estates in accordance with applicable law and
hereby is authorized to pay (from its own funds and without any
right of contribution or reimbursement as against the Estates)
any and all claims, liabilities, losses, damages, costs and
expenses incurred in connection therewith or as a result thereof,
including all fees and expenses of its professionals accruing
from and after the Confirmation Date without any application to
the Bankruptcy Court. Reorganized Wherehouse is not entitled to
receive any compensation or indemnification whatsoever from the
Estates for its services as such liquidating agent or in respect
of any such claims, liabilities, losses, damages, costs or
expenses.
19. A&S and each A&S Holder shall be, and hereby is
deemed to be, reciprocally bound by the provisions of Section
12.05 of the Plan and shall constitute a Release Obligor for the
purposes of Section 12.05 of the Plan.
20. The settlements of claims and defenses comprising
and included in the Plan, including the settlement of the amount
of the Senior Lender Secured Claims, the releases set forth in
Section 12.04 of the Plan, the releases of the Release Obligors
set forth in Section 12.05 of the Plan, the settlement of the
Acquisition Related Causes of Action pursuant to Section 12.09 of
the Plan and the Deferred Purchase Price Settlement set forth in
Section 12.10 of the Plan, are hereby approved pursuant to
Bankruptcy Rule 9019(a) as just, equitable, reasonable, non-
discriminatory and good faith compromises of the controversies
and Claims resolved by such settlements, and such settlements are
binding on all entities affected thereby.
21. (i) The McMahan Settlement described in Section
12.10 of the Plan is hereby approved, (ii) A&S is authorized to
make the payments to settle such action pursuant to a draw on the
1992 Merger Agreement Letter of Credit, under the terms and
conditions set forth in Section 12.10 of the Plan and the McMahan
Settlement, and the Effective Date of the Plan shall constitute
an Event of Default under Section 8.3(a)(v)(A) of the 1992 Merger
Agreement for the sole purposes of (x) authorizing A&S to draw
immediately on the 1992 Merger Agreement Letter of Credit to make
the Settlement Payment and to consummate the McMahan Settlement,
notwithstanding, among other things, the "Stipulation Granting
Relief from the Automatic Stay to Permit Certain Litigation
Related to the 1988 Merger to Proceed to Judgment but Excluding
any Enforcement Thereof," entered on July 30, 1996, (y)
authorizing A&S to draw immediately on the 1992 Merger Agreement
Letter of Credit and collect and retain the entire amount
remaining after making the Settlement Payment and the payments
required under the McMahan Settlement and (z) authorizing A&S to
receive and retain all proceeds from the "Escrow Funds" (as that
term is defined in the Escrow Agreement dated as of June 11, 1992
by and among A&S, Holdings and Chase Manhattan Bank, N.A.), if
any (the proceeds described in clauses (y) and (z) constituting
the "Letter of Credit Proceeds"), (iii) A&S is authorized to pay
all litigation costs and expenses (including, without limitation,
fees and expenses for attorneys and witnesses) related to the
Actions (as defined in the McMahan Settlement) and to distribute
immediately all Letter of Credit Proceeds to the A&S Holders
without further application to or order of the Court, (iv) the
Debtors are directed (after presentation by A&S of the 1992
Merger Agreement Letter of Credit for cancellation, which shall
occur after receipt by A&S of all Letter of Credit Proceeds) to
deliver to Bankers Trust Company, as the issuing bank of the 1992
Merger Agreement Letter of Credit, a certificate in the form
attached as Annex B to the 1992 Letter of Credit Agreement
designating A&S as the person to which any positive balance in
the Notional Funding Account-Principal and the Notional Funding
Account-Interest (in each case as defined in the 1992 Letter of
Credit Agreement) and net of any Letter of Credit Charges (as
defined in the 1992 Letter of Credit Agreement) shall be refunded
upon final reconciliation of such accounts, (v) Bankers Trust
Company, as the issuing bank of the 1992 Merger Agreement Letter
of Credit, is directed to honor any properly presented drawing
certificate (in the form of Exhibit "A" to the 1992 Merger
Agreement Letter of Credit) under the 1992 Merger Agreement
Letter of Credit, and not to reduce or withhold any (or otherwise
interfere in any way with A&S's right to receive) the Letter of
Credit Proceeds, other than deducting any Letter of Credit
Charges from the refunds as provided by clause (iv) above, and
(vi) upon and subsequent to the entry of this Order (x) neither
the Debtors nor Reorganized Wherehouse shall submit a Decrease
Certificate (as defined in the 1992 Letter of Credit Agreement),
(y) A&S shall be responsible for all fees and costs of Litigation
Counsel (as defined in the 1992 Merger Agreement) not previously
paid by the Debtors (including, without limitation, any holdbacks
from the interim statements previously submitted to the Debtors),
and (z) neither the Debtors nor Reorganized Wherehouse shall pay
any additional fees or costs of Litigation Counsel (as defined in
the 1992 Merger Agreement).
22. The Debtors and Reorganized Wherehouse are
authorized to take such action as reasonably requested by A&S to
assist in obtaining (i) the Letter of Credit Proceeds and (ii) an
order of the United States District Court approving the McMahan
Settlement; provided that the Debtors shall not be required to
take any action that would result in any Claim against the
Estates or any other liability to the Debtors, the Estates or
Reorganized Wherehouse.
23. The BT Adversary Proceeding shall be, and hereby
is, deemed dismissed with prejudice on the Effective Date, with
each party to bear its own costs.
24. The Adversary Proceeding captioned United States
Trust Company of New York and the Official Committee of Unsecured
Creditors v. Cerberus Partners, L.P., et al, Adversary Proceeding
No. A-96-182, shall be, and hereby is, deemed dismissed with
prejudice on the Effective Date, with each party to bear its own
costs.
25. The terms and the conditions of the Working
Capital Facility and the Working Capital Facility Documents on
substantially the terms set forth in the Post-Confirmation
Financing Motion are hereby approved in all respects.
Reorganized Wherehouse is authorized, without further approval by
the Court, its board of directors or its shareholders but subject
to the approval of the Trade Committee with respect to the
intercreditor agreement to be entered into by Congress and
certain suppliers of Reorganized Wherehouse and the covenants of
the Working Capital Facility Documents, to execute and to deliver
all definitive documentation relating to the Working Capital
Facility, including without limitation, the Working Capital
Facility Documents, and upon the execution thereof by Reorganized
Wherehouse, the Working Capital Facility Documents shall
constitute the legal, valid and binding obligations of
Reorganized Wherehouse, enforceable against Reorganized
Wherehouse in accordance with their respective terms and are
entered into for good and valuable consideration, including the
benefits of the Plan. Upon the entry of this Order, the Debtors
are authorized to pay immediately to Congress $75,000 as a non-
refundable commitment fee to be applied to the $150,000 closing
fee to be paid in connection with the Working Capital Facility.
The remainder of any fees and/or deposits shall be paid pursuant
to the terms and conditions of the Working Capital Facility
Documents. Nothing contained in this Order or the Plan shall
release, adversely modify or impair the enforceability or
priority of any obligation or lien entered into or created in
connection with the Working Capital Facility Documents. Congress
is a good faith lender within the meaning of and subject to the
protections and benefits of Section 364(e) of the Bankruptcy Code.
26. The liens and the security interests to be granted
by Reorganized Wherehouse in favor of Congress under the Working
Capital Facility Documents shall be, and hereby are, deemed
perfected, first priority liens on the Effective Date, and shall
be senior to any and all liens granted by Reorganized Wherehouse,
except as otherwise permitted in the Working Capital Facility
Documents.
27. If the Confirmation Order is reversed or modified
and the Debtors resume operations as debtors in possession,
subject to a Chapter 11 trustee, or if following such reversal or
modification the case is converted to Chapter 7, then the Debtors
shall be obligated for their debt to Congress, including that
debt evidenced by the Working Capital Facility Documents, and
Congress shall, and hereby does, have a first and superpriority
lien, security interest and administrative claim pursuant to
Sections 503(b), 507(b) and 364(c) and (d) of the Bankruptcy Code
in all of the Debtors' present and future inventory and all
proceeds (including accounts) therefrom, all general intangibles
and all of the Debtors' and the Estates' unencumbered assets and
the proceeds therefrom.
28. If the Confirmation Order is reversed or the Plan
is later modified in a manner that affects the rights, liens or
priorities of Congress, the Holders of the Senior Lender Claims
shall deliver to Congress subordination agreements in form and
substance satisfactory to Congress.
29. The liens, security interest and administrative
priorities granted to Congress shall be, and hereby are,
irrevocably in full force and effect without subsequent
modification.
30. Notwithstanding any other provision of this Order
or the Plan, Reorganized Wherehouse shall repay in full in cash,
not later than the Effective Date, all loans made and any other
amounts owed under the Debtor-In-Possession Credit Agreement,
dated as of September 25, 1995, as amended, by and among the
Debtors, certain lenders and Bankers Trust Company, individually
and as Agent for such lenders.
31. Pursuant to Article 7.02 of the Plan, and in
accordance with Sections 365 and 1123(b)(2) of the Bankruptcy
Code, the Debtors are hereby authorized to assume and to assign
to Reorganized Wherehouse those unexpired leases and executory
contracts set forth on the Schedule of Assumed Contracts (except
the lease of store No. 506 with Encino Valley Shopping Center,
which is the subject of a pending motion to assume).
32. Any unexpired lease or executory contract assumed
by the Debtors at any time during the pendency of the Chapter 11
Cases (and not otherwise assigned) shall be assigned to and
assumed by Reorganized Wherehouse, unless prior to the Effective
Date the Debtors, with the Bank Agent's approval, elect that such
lease or contract shall be assigned to and assumed by another
Entity. Any assignment of such leases or contracts is hereby
approved pursuant to Section 365 of the Bankruptcy Code.
33. Any unexpired lease or executory contract that has
not been expressly rejected or assumed by the Debtors with the
Bankruptcy Court's approval on or prior to the Effective Date
shall be deemed to have been rejected by the Debtors as of the
Effective Date unless there is then pending before the Bankruptcy
Court a motion to assume such unexpired lease or executory
contract (any contracts so rejected, the "Rejected Contracts").
The rejection of the Rejected Contracts is hereby approved
pursuant to Section 365 of the Bankruptcy Code.
34. As to any leases or executory contracts assumed
hereunder, unless a statement as to the amount of a party's claim
under Section 365(b) of the Bankruptcy Code (the "Cure Amount")
is filed with the Court on or before December 31, 1996, the Cure
Amounts for such leases and contracts shall be, and hereby are,
deemed to have been satisfied in full upon the payment by the
Debtors on the Effective Date of any Cure Amount set forth in the
Notice of Section 365(b) Payment mailed to such party on or about
December 17, 1996, or any amendment thereof. If a party timely
files with the Court a statement as to the amount of such party's
Cure Amount and such Cure Amount is disputed by the Debtors, the
requirements of Section 365(b) of the Bankruptcy Code shall be,
and hereby are, deemed to have been satisfied in full upon the
payment by the Debtors of the Allowed amount of such party's Cure
Amount promptly after the Court's determining the Allowed amount
of such Cure Amount. All other requirements of Section 365 with
respect to the assumption of such leases and contracts shall be,
and hereby are, deemed to have been satisfied upon entry of this
Order.
35. Claims, if any, arising from the rejection of the
Rejected Contracts shall be filed within thirty (30) days after
the entry of this Order or be forever barred from enforcement or
assertion in the Court or any other court. The Debtors shall
forthwith provide notice of rejection to the non-debtor parties
to the Rejected Contracts and of their requirement to file a
proof of claim pursuant to this paragraph.
36. On the Effective Date, the Prepetition Loan
Documents, including all notes and other instruments outstanding
thereunder or issued pursuant thereto and all obligations of the
Debtors or the Estates thereunder or in respect thereof, the
Senior Subordinated Notes and the Senior Subordinated Note
Indenture and all obligations of the Debtors or the Estates
thereunder or in respect thereof, the Convertible Subordinated
Debentures and the Convertible Subordinated Debenture Indenture
and all obligations of the Debtors or the Estates thereunder or
in respect thereof, and all Interests shall be, and hereby are,
cancelled and discharged and fully satisfied by confirmation of
the Plan and the distributions to be made pursuant to the Plan;
provided, however, that the 1992 Merger Agreement Letter of
Credit shall not be cancelled and the rights of the Debtors under
1992 Merger Agreement Letter of Credit (if any) and the 1992
Letter of Credit Agreement shall be governed by Section 12.10 of
the Plan.
37. Except as otherwise provided in the Plan,
distributions in respect of Claims that, on the Effective Date,
are Allowed Claims shall be made by Reorganized Wherehouse (or
its designee) on or as promptly as practicable after the
Effective Date. Distributions in respect or as a result of
Claims Allowed after the Effective Date shall be made as soon as
practicable after such Claim becomes Allowed.
38. Any party in interest may object to an Impaired
Claim, except a Claim that is Allowed as set forth in the Plan.
Any such objection must be filed and served no later than the
later of (a) the 60th day following the Effective Date, (b) 30
days after the filing of the proof of claim of such Claim, or (c)
any later day set by order of the Bankruptcy Court, which the
Debtors or Reorganized Wherehouse may request on an ex parte
basis. Only Reorganized Wherehouse may object to Claims that are
not Impaired. Objections to Claims, except Claims that are
Allowed pursuant to the Plan, may be filed and served by
Reorganized Wherehouse at any time on or prior to the applicable
dates set forth above. Unless otherwise ordered by the
Bankruptcy Court, the Debtors or Reorganized Wherehouse shall
litigate the merits of each Disputed Claim until it is abandoned
by the Holder, determined by Final Order or compromised and
settled by the Debtors or Reorganized Wherehouse, subject to any
required approval of the Bankruptcy Court. No payments or
distributions shall be made in respect of any Disputed Claim.
39. Only those Holders of record of Claims as of the
close of business on the date of entry of this Order shall be
entitled to receive distributions under the Plan.
40. As of the Effective Date, the confirmation of the
Plan shall (i) discharge the Debtors, the Estates and Reorganized
Wherehouse from any debt that arose before the Confirmation Date,
any debt of the kind specified in Sections 502(g), 502(h) or
502(i) of the Bankruptcy Code, all Claims treated in the Plan,
all contingent and unliquidated liability of every type and
description to the fullest extent discharge of such liabilities
is permitted under the Bankruptcy Code, and all other Claims
against either or both of the Debtors or the Estates that were
outstanding, accrued or existing, or might reasonably have been
asserted, on the Confirmation Date, in each instance whether or
not a proof of such Claim is filed or deemed filed, whether or
not such Claim is Allowed, and whether or not the holder of such
Claim has voted on the Plan, and (ii) terminate all rights and
interests of the Holders of all Interests.
41. On the Effective Date, the distributions and
rights provided under the Plan shall be in complete satisfaction,
discharge and release, effective as of the Confirmation Date, of
all Claims against and Interests in the Debtors and the Estates
and of all liens upon any property of the Estates or Reorganized
Wherehouse.
42. This Order shall constitute an injunction
restraining any Entity from commencing or continuing any action,
suit or proceeding, or employing any process, or otherwise
acting, to collect, offset or recover any Claim discharged under
the Plan to the fullest extent authorized or provided by the
Bankruptcy Code, including Sections 524 and 1141 thereof. This
Order shall constitute an injunction enjoining any Entity from
enforcing or attempting to enforce any Cause of Action against
any present or former shareholder, director, officer, employee,
attorney or agent of either or both of the Debtors or Reorganized
Wherehouse based on, arising from or relating to any failure to
pay, or make provision for payment of, any amount payable in
respect of any Priority Tax Claim on which the payments due under
Section 3.01 of the Plan have been made or are not yet due under
Section 3.01.
43. The Debtors' discharge provided in the Plan shall
not diminish or impair the enforceability of any insurance
policies that may cover claims against the Debtors or any other
person or Entity.
44. The release of Causes of Action pursuant to the
Plan shall, pursuant to Section 105 of the Bankruptcy Code, also
act as an injunction against any Entity commencing or continuing
any action, or acting to collect, offset, or recover any Cause of
Action released under the Plan to the fullest extent authorized
under the Bankruptcy Code, and the Bankruptcy Court shall retain
exclusive jurisdiction over any contested or litigated matters to
enforce this injunction.
45. This Court hereby retains jurisdiction of these
proceedings pursuant to and for the purposes of Sections 105(a)
and 1127 of the Bankruptcy Code to the fullest extent permitted
by law, and shall have such jurisdiction exclusively to the
fullest extent permitted by law, including for the purpose of
hearing requests for relief and determining disputes related to
the issues specified in Section 14.01 of the Plan.
46. When the Plan becomes effective as set forth in
Section 13.02 of the Plan, the Official Committee shall cease to
exist and its members and employees or agents (including
attorneys, investment bankers, financial advisors, accountants
and other professionals) shall be, and hereby are, released and
discharged from all further authority, duties, responsibilities
and obligations relating to, arising from or in connection with
the Chapter 11 Cases.
47. To the fullest extent permitted under Section 1145
of the Bankruptcy Code, the offer and sale of the New Common
Stock and the Warrants (and any shares of New Common Stock issued
upon exercise of the Warrants) and transactions in such
securities shall be and hereby are exempt from the registration
requirements of Section 5 of the Securities Act of 1933, as
amended, and any state or local law requiring registration for
offer or sale of a security or registration or licensing of an
issuer of, underwriter of, or broker or deal in, such New Common
Stock or Warrants, and such securities may be resold subject to
the limitations contemplated by Section 1145 of the Bankruptcy
Code. The offer and sale of the New Common Stock and the
Warrants under the Plan is deemed to be a public offering of the
New Common Stock and the Warrants.
48. To the fullest extent permitted under Section
1146(c) of the Bankruptcy Code, the issuance, transfer or
exchange of any security under the Plan, or the execution,
delivery or recording of an instrument of transfer pursuant to,
in implementation of or as contemplated by the Plan, or the
revesting, transfer or sale of any real property of the Debtors
pursuant to, in implementation of or as contemplated by the Plan
shall not be taxed under any state or local law imposing a stamp
tax, transfer tax or similar tax or fee. Consistent with the
foregoing, each recorder of deeds or similar official for any
county, city or governmental unit in which any instrument
hereunder is to be recorded shall be, and hereby are, ordered and
directed to accept such instrument, without requiring the payment
of any documentary stamp tax, deed stamps, stamp tax, transfer
tax, intangible tax or similar tax.
49. Claims for Administrative Expenses shall become
Allowed only as provided in Section 2.01 of the Plan as follows:
(a) an Ordinary Course Administrative Expense or Approved Chapter
11 Liability that is not disputed by Reorganized Wherehouse by
written notice given to the claimant prior to the 60th day after
the Effective Date shall become Allowed on such day; (b) a
Reclamation Claim shall become Allowed only to the extent either
(i) Reorganized Wherehouse and the Holder of the Reclamation
Claim agree upon the amount thereof in a stipulation approved by
the Bankruptcy Court or (ii) the Holder files with the Bankruptcy
Court and serves on Reorganized Wherehouse a motion requesting
payment of such Reclamation Claim within 60 days after the
Effective Date and a Final Order is entered granting such motion;
(c) a Fee Claim shall become Allowed if allowed or approved by
the Bankruptcy Court upon an application filed no later than 60
days after the Effective Date and (d) all other claims for an
Administrative Expenses (including Ordinary Course Administrative
Expenses and Approved Chapter 11 Liabilities that are disputed by
Reorganized Wherehouse as set forth in Section 2.01(a) of the
Plan) shall become Allowed only if the Holder of such Claim files
with the Bankruptcy Court and serves on Reorganized Wherehouse,
within 60 days after the Effective Date, a motion requesting
payment of such Administrative Expense and only if and to the
extent such Claim is allowed by the Bankruptcy Court pursuant to
a Final Order. Any objections to an application or motion for
allowance of an Administrative Expense must be filed and served
on Reorganized Wherehouse and the moving party within 30 days
after the last date for filing such application or motion. If
the Holder of an Administrative Expense fails to file an
application or motion within the time required under Section 2.01
of the Plan, such Administrative Expense shall be barred and
discharged.
50. Upon the occurrence of the Effective Date in
accordance with the terms of the Plan and this Order, the Debtors
shall promptly mail to all creditors and parties in interest with
and publish in a newspaper of general circulation in Southern
California a notice of entry of this Order and occurrence of the
Effective Date, which notice shall set forth, among other things,
the date of the Effective Date and the dates for filing
applications and motions for the allowance of Administrative
Expenses and objections thereto.
51. The failure to reference or discuss any particular
provision of the Plan in this Order shall have no effect on the
validity, binding effect and enforceability of such provision and
such provision shall have the same validity, binding effect and
enforceability as every other provision of the Plan.
Dated: Wilmington, Delaware
January 7, 1997
/s/ Helen S. Balick
-----------------------------
Honorable Helen S. Balick
United States Bankruptcy Judge