UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE
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:
In re :
: CHAPTER 11
CONSOLIDATED HYDRO, INC., : CASE NO. _____________
:
Debtor. :
:
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PLAN OF REORGANIZATION UNDER CHAPTER 11 OF
THE BANKRUPTCY CODE OF CONSOLIDATED HYDRO, INC.
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Consolidated Hydro, Inc. proposes the following plan of reorganization
under section 1121(a) of title 11 of the United States Code:
ARTICLE I - DEFINITION OF TERMS AND RULES OF INTERPRETATION
Unless otherwise required by the context, the words and phrases listed
below shall have the following meanings when used in the Plan. Wherever from the
context it appears appropriate, each term stated in either the singular or the
plural shall include both the singular and the plural and pronouns stated in the
masculine, feminine or neuter gender shall include the masculine, feminine and
neuter. Unless otherwise specified, all section, article, schedule or exhibit
references in the Plan are to the respective section in, article of, schedule
to, or exhibit to, the Plan. The words "herein," "hereof," "hereto," "hereunder"
and other words of similar import refer to the Plan as a whole and not to any
particular section, subsection or clause contained in the Plan. The rules of
construction contained in section 102 of the Bankruptcy Code shall apply to the
construction of the Plan. A term used herein that is not defined herein, but
that is used in the Bankruptcy Code, shall have the meaning ascribed to that
term in the Bankruptcy Code. The headings in the Plan are for convenience of
reference only and shall not limit or otherwise affect the provisions of the
Plan.
1.1 Administrative Expense Claim means any right to payment constituting a
cost or expense of administration of the Chapter 11 Case under sections 503(b)
and 507(a)(1) of the Bankruptcy Code, including, without limitation, any actual
and necessary costs and expenses of preserving the estate of the Debtor, any
actual and necessary costs and expenses of operating the business of the Debtor,
any indebtedness or obligations incurred or assumed by the Debtor in Possession
in connection with the conduct of its business, including, without limitation,
for the acquisition or lease of property or an interest in property or the
rendition of services, all compensation and reimbursement of expenses to
the extent Allowed by the Bankruptcy Court under section 330 or 503 of the
Bankruptcy Code and any fees or charges assessed against the estate of the
Debtor under section 1930 of chapter 123 of title 28 of the United States Code.
1.2 Allowed means (a) with respect to an Administrative Expense Claim, an
Administrative Expense Claim that is allowed or deemed allowed pursuant to
section 503 of the Bankruptcy Code; and (b) with respect to a Claim or Equity
Interest, any Claim or Equity Interest (i) proof of which is timely and properly
filed, or, if no proof of Claim or Equity Interest is timely and properly filed,
a Claim or Equity Interest that is listed by the Debtor on its Schedules, as
such Schedules may be amended from time to time in accordance with Bankruptcy
Rule 1009, as liquidated in amount, not disputed and not contingent, and (ii)
that is allowed or deemed allowed pursuant to section 502 of the Bankruptcy Code
and not Disputed. Unless otherwise specified herein or by order of the
Bankruptcy Court, "Allowed" shall not, for purposes of computation of
distributions under the Plan, include accrual or payment of interest on any
Claim or Equity Interest from and after the Commencement Date.
1.3 Amended CHI By-Laws means the amended By-Laws of CHI Energy, Inc.,
which shall be in substantially the form of Exhibit A annexed hereto.
1.4 Bankruptcy Code means title 11 of the United States Code, as amended
from time to time, as applicable to the Chapter 11 Case.
1.5 Bankruptcy Court means the United States District Court for the
District of Delaware having jurisdiction over the Chapter 11 Case and, to the
extent of any reference under section 157 of title 28 of the United States Code,
the unit of such District Court under section 151 of title 28 of the United
States Code.
1.6 Bankruptcy Judge means the United States District Court Judge presiding
over the Chapter 11 Case, and, to the extent of a reference of the Chapter 11
Case, the United States Bankruptcy Judge presiding over the Chapter 11 Case.
1.7 Bankruptcy Rules means the Federal Rules of Bankruptcy Procedure as
promulgated by the United States Supreme Court under section 2075 of title 28 of
the United States Code, and any Local Rules of the Bankruptcy Court.
1.8 Business Day means any day other than a Saturday, Sunday or any other
day on which commercial banks in New York, New York are required or authorized
to close by law or executive order.
1.9 Cash means legal tender of the United States of America and equivalents
thereof.
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1.10 Chapter 11 Case means the case under chapter 11 of the Bankruptcy Code
commenced by the Debtor, styled In re Consolidated Hydro, Inc.
1.11 CHI means Consolidated Hydro, Inc., a Delaware corporation.
1.12 Claim has the meaning set forth in section 101(5) of the Bankruptcy
Code.
1.13 Class means a category of holders of Claims or Equity Interests as set
forth in Article III of the Plan.
1.14 Class 3 Cash Payment means the sum of $15,000,000 plus the Unofficial
Bondholders' Committee Expenses to be paid in Cash as follows: (a) $10,000,000
plus the Unofficial Bondholders' Committee Expenses on the Effective Date; (b)
up to $5,000,000 payable out of Excess Cash and the proceeds of a working
capital facility (to the extent permitted by the lender under such working
capital facility) on or before December 31, 1997; and (c) if the payment set
forth in subsection (b) is not made in full by December 31, 1997, the balance of
the $5,000,000 payment on or before March 31, 1998, with interest thereon at the
Prime Rate from December 31, 1997, until the date the balance is paid in full.
1.15 Collateral means any property or interest in property of the estate of
the Debtor subject to a Lien to secure the payment or performance of a Claim,
which Lien is not subject to avoidance under the Bankruptcy Code or otherwise
invalid under the Bankruptcy Code or applicable state law.
1.16 Commencement Date means the date on which CHI commences the Chapter 11
Case.
1.17 Confirmation Date means the date on which the Confirmation Order is
signed by the Bankruptcy Judge.
1.18 Confirmation Hearing means the hearing held by the Bankruptcy Court to
consider confirmation of the Plan pursuant to section 1129 of the Bankruptcy
Code, as such hearing may be adjourned or continued from time to time.
1.19 Confirmation Order means the order of the Bankruptcy Court confirming
the Plan pursuant to section 1129 of the Bankruptcy Code.
1.20 Creditors' Committee means the statutory committee of unsecured
creditors appointed in the Chapter 11 Case pursuant to section 1102 of the
Bankruptcy Code, provided, however, that if no such committee is appointed, the
Unofficial Bondholders' Committee shall constitute the Creditors' Committee.
1.21 Debtor means CHI.
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1.22 Debtor in Possession means the Debtor in its capacity as debtor in
possession in the Chapter 11 Case pursuant to sections 1101, 1107(a) and 1108 of
the Bankruptcy Code.
1.23 Disputed means, with reference to any Claim or Equity Interest, any
Claim or Equity Interest proof of which was timely and properly filed and which
has been or hereafter is listed on the Schedules as unliquidated, disputed or
contingent, and in either case or in the case of an Administrative Expense
Claim, any Administrative Expense Claim, Claim or Equity Interest which is
disputed under the Plan or as to which the Debtor has interposed a timely
objection and/or request for estimation in accordance with section 502(c) of the
Bankruptcy Code and Bankruptcy Rule 3018, which objection and/or request for
estimation has not been withdrawn or determined by a Final Order, and any Claim
or Equity Interest proof of which was required to be filed by order of the
Bankruptcy Court but as to which a proof of claim or interest was not timely or
properly filed.
1.24 Distribution Record Date means the day that is three Business Days
from and after the Confirmation Date.
1.25 DnB Facility Agreement means that certain Revolving Credit Agreement
among CHI, as Borrower, the banks listed therein and Den norske Bank AS, as
agent, dated as of October 14, 1993, together with the related documents
thereto, in each case as such agreements may have been modified or amended.
1.26 DnB Facility Claim means any Claim arising from or relating to the DnB
Facility
Agreement.
1.27 Effective Date means the first Business Day on which the conditions
specified in Section 11.1 of the Plan have been satisfied or waived.
1.28 Employment Agreements means the employment agreements entered into
between Reorganized CHI and certain of its key executives, which shall be in
substantially the form annexed hereto as Exhibit C.
1.29 Equity Interest means an interest in the Debtor evidenced by Old
Preferred Stock, Old Common Stock, Old Warrants, Old Options or other
instruments evidencing an ownership interest in CHI, whether or not
transferable.
1.30 Excess Cash means an amount equal to the unrestricted cash balance of
the Debtor as of December 31, 1997, plus the difference between (i) the sum of
all unrestricted cash requirements of Reorganized CHI in the 3-month period
ending March 31, 1998 and (ii) the sum of all unrestricted cash anticipated to
be received by Reorganized CHI through the end of such 3-month period. All such
amounts shall be certified by Reorganized CHI's chief accounting officer in a
writing delivered to each holder of an Allowed Senior Discount Notes Claim and
shall be determined by reference to Reorganized CHI's fiscal 1998 budget and
actual receivables and payables as of December 31, 1997.
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1.31 Final Order means an order of the Bankruptcy Court as to which the
time to appeal, petition for certiorari, or move for reargument or rehearing has
expired and as to which no appeal, petition for certiorari, or other proceedings
for reargument or rehearing shall then be pending or as to which any right to
appeal, petition for certiorari, reargue, or rehear shall have been waived in
writing in form and substance satisfactory to the Debtor or Reorganized CHI or,
in the event that an appeal, writ of certiorari, or reargument or rehearing
thereof has been sought, such order of the Bankruptcy Court shall have been
determined by the highest court to which such order was appealed, or certiorari,
reargument or rehearing shall have been denied and the time to take any further
appeal, petition for certiorari or move for reargument or rehearing shall have
expired; provided, however, that the possibility that a motion under Rule 59 or
Rule 60 of the Federal Rules of Civil Procedure, or any analogous rule under the
Bankruptcy Rules, may be filed with respect to such order shall not cause such
order not to be a Final Order.
1.32 General Unsecured Claim means any Claim that is not a Priority Tax
Claim, Other Priority Claim, Secured Claim, Senior Discount Note Claim, DnB
Facility Claim or Intercompany Claim.
1.33 Intercompany Claim means any Claim of any Nondebtor Subsidiary against
the Debtor.
1.34 Lien has the meaning set forth in section 101(37) of the Bankruptcy
Code.
1.35 Management Option Agreements has the meaning set forth in Section 10.5
of the Plan.
1.36 Management Option Plan has the meaning set forth in Section 10.5 of
the Plan.
1.37 Management Options means options to purchase 810,811 shares of New
Class A Common Stock pursuant to the provisions of the Management Option
Agreements to be entered into under the Management Option Plan.
1.38 New Class A Common Stock means the Class A common stock of Reorganized
CHI authorized and to be issued pursuant to the Plan. The New Class A Common
Stock shall have a par value of $.01 per share and such rights with respect to
dividends, liquidation and other matters as are provided for by applicable
nonbankruptcy law or in the Restated CHI Certificate of Incorporation and the
Amended CHI By-Laws. Each share of New Class A Common Stock shall have one (1)
vote.
1.39 New Class B Common Stock means the Class B common stock of Reorganized
CHI authorized and to be issued pursuant to the Plan. The New Class B Common
Stock shall have a par value of $.01 per share and such rights with respect to
dividends, liquidation and other matters as are provided for by applicable
nonbankruptcy law or in the Restated CHI Certificate of Incorporation and the
Amended CHI By-Laws. Each share of New Class B Common Stock shall have
one-hundredth (1/100) of one vote.
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1.40 New Common Stock means, collectively, the New Class A Common Stock and
the New
Class B Common Stock.
1.41 New Series B Warrants means warrants issued by Reorganized CHI to
purchase 810,811 shares of New Common Stock pursuant to the provisions of the
Series B Warrant Agreement, the form of which is annexed hereto as Exhibit E.
1.42 New Series C Warrants means warrants issued by Reorganized CHI to
purchase 526,316 shares of New Common Stock pursuant to the provisions of the
Series C Warrant Agreement, the form of which is annexed hereto as Exhibit F.
1.43 New Warrants means the New Series B Warrants and the New Series C
Warrants.
1.44 Nondebtor Subsidiary means any of the direct or indirect subsidiaries
of the Debtor or entities controlled by the Debtor, set forth on Exhibit G
annexed hereto.
1.45 Old Common Stock means all authorized and issued class A common stock
of CHI, authorized class B common stock of CHI, Old Options and Old Warrants,
including any right, contractual or otherwise, to acquire any common stock of
CHI, existing prior to the Commencement Date.
1.46 Old Options means any and all rights or options granted or issued by
the Debtor prior to the Commencement Date to purchase common stock of CHI.
1.47 Old Preferred Stock means, collectively, the Series F Preferred Stock,
the Series H Preferred Stock, and the Series G Preferred Stock.
1.48 Old Warrants means any and all warrants issued by the Debtor prior to
the Commencement Date to purchase common stock of CHI, whether or not such
warrants are outstanding.
1.49 Other Priority Claim means any Claim, other than an Administrative
Expense Claim or a Priority Tax Claim, entitled to priority in right of payment
under section 507(a) of the Bankruptcy Code.
1.50 Plan means this chapter 11 plan of reorganization, including, without
limitation, the Plan Supplement and all exhibits, schedules, supplements, and
appendices hereto, either in its present form or as the same may be altered,
amended or modified from time to time.
1.51 Plan Supplement means the documents and forms of documents specified
in Section 14.12 of the Plan.
1.52 Prime Rate means the prime rate as determined by Citibank, N.A.
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1.53 Priority Tax Claim means any Claim of a governmental unit of the kind
specified in sections 502(i) and 507(a)(8) of the Bankruptcy Code.
1.54 Pro Rata Share means a proportionate share, so that the ratio of the
consideration distributed on account of an Allowed Claim or Allowed Equity
Interest in a Class to the amount of such Allowed Claim or Allowed Equity
Interest is the same as the ratio of the amount of the consideration distributed
on account of all Allowed Claims or Allowed Equity Interests in such Class to
the amount of all Allowed Claims or Allowed Equity Interests in such Class.
1.55 Registration Rights Agreement means that certain agreement governing
the registration of New Common Stock, the New Warrants and the additional shares
of New Common Stock issuable upon exercise of the New Warrants or the Management
Options, the form of which is annexed hereto as Exhibit H.
1.56 Releasees means all present and former officers and directors of the
Debtor and any other persons who serve or served as members of management of the
Debtor, all members of the Unofficial Bondholders' Committee, all present and
former officers and directors and other persons who serve or served as members
of the management of any member of such Committee, and all advisors or
consultants of or to the Debtor and the Unofficial Bondholders' Committee.
1.57 Reorganized CHI means CHI Energy, Inc., or any successor thereto by
merger, consolidation or otherwise, on and after the Effective Date.
1.58 Restated CHI Certificate of Incorporation means the Restated
Certificate of Incorporation of Consolidated Hydro, Inc., which shall be in
substantially the form of Exhibit B annexed hereto.
1.59 Schedules means the schedules of assets and liabilities to be filed by
the Debtor pursuant to section 521 of the Bankruptcy Code and Bankruptcy Rule
1007, including any amendments and modifications thereto through the
Confirmation Date.
1.60 Secured Claim means any Claim, to the extent reflected in the
Schedules or a proof of claim as a Secured Claim, which is secured by a Lien on
Collateral to the extent of the value of such Collateral, as determined in
accordance with section 506(a) of the Bankruptcy Code, or, in the event that
such Claim is subject to setoff under section 553 of the Bankruptcy Code, to the
extent of such setoff.
1.61 Senior Discount Notes means the 12% Senior Discount Notes due 2003
issued pursuant to that certain Indenture dated as of June 15, 1993, as amended
and restated in the Amended and Restated Indenture dated as of February 7, 1994.
1.62 Senior Discount Notes Claim means a Claim arising from or relating to
the Senior Discount Notes, including interest accrued on the Senior Discount
Notes through, but not including, the Commencement Date.
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1.63 Series F Distribution means each of (a) that number of New Series B
Warrants equal to the product of (i) the Series F Percentage and (ii) the
aggregate number of New Series B Warrants and (b) that number of New Series C
Warrants equal to the product of (x) the Series F Percentage and (y) the
aggregate number of New Series C Warrants.
1.64 Series F Equity Interest means an Equity Interest represented by the
Series F Preferred Stock.
1.65 Series F Percentage means the quotient, expressed as a percentage,
obtained by dividing (i) the aggregate liquidation preference of the Series F
Preferred Stock (as increased by the aggregate liquidation preference of all
accrued and unpaid dividends, whether declared or not, through the Commencement
Date), by (ii) the sum of the aggregate liquidation preference of the Series F
Preferred Stock, the Series G Preferred Stock and the Series H Preferred Stock
(with respect to the Series F Preferred Stock and Series G Preferred Stock, as
increased by the aggregate liquidation preference of all accrued and unpaid
dividends, whether declared or not, through the Commencement Date, and with
respect to the Series H Preferred Stock, as increased by the aggregate
liquidation preference of (x) all pay-in-kind dividends declared and paid from
inception through the Commencement Date and (y) all accrued and unpaid
dividends, whether declared or not, through the Commencement Date).
1.66 Series F Preferred Stock means the Series F 8% Senior Convertible
Preferred Stock issued pursuant to that certain Purchase Agreement dated March
25, 1992, among CHI, the Morgan Stanley Leveraged Equity Fund II, L.P. and
Madison Group, L.P.
1.67 Series G Distribution means each of (a) that number of New Series B
Warrants equal to the product of (i) the Series G Percentage and (ii) the
aggregate number of New Series B Warrants and (b) that number of New Series C
Warrants equal to the product of (x) the Series G Percentage and (y) the
aggregate number of New Series C Warrants.
1.68 Series G Equity Interest means an Equity Interest represented by the
Series G Preferred Stock.
1.69 Series G Percentage means the quotient, expressed as a percentage,
obtained by dividing (i) the aggregate liquidation preference of the Series G
Preferred Stock (as increased by the aggregate liquidation preference of all
accrued and unpaid dividends, whether declared or not, through the Commencement
Date), by (ii) the sum of the aggregate liquidation preference of the Series F
Preferred Stock, the Series G Preferred Stock and the Series H Preferred Stock
(with respect to the Series F Preferred Stock and Series G Preferred Stock, as
increased by the aggregate liquidation preference of all accrued and unpaid
dividends, whether declared or not, through the Commencement Date, and with
respect to the Series H Preferred Stock, as increased by the aggregate
liquidation preference of (x) all pay-in-kind dividends declared and paid from
inception through the Commencement Date and (y) all accrued and unpaid
dividends, whether declared or not, through the Commencement Date).
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1.70 Series G Preferred Stock means the Series G 9.85% Junior Convertible
Preferred Stock issued pursuant to that certain Purchase Agreement dated March
25, 1992, among CHI, the Morgan Stanley Leveraged Equity Fund II, L.P. and
Madison Group, L.P.
1.71 Series H Distribution means each of (a) that number of New Series B
Warrants equal to the product of (i) the Series H Percentage and (ii) the
aggregate number of New Series B Warrants and (b) that number of New Series C
Warrants equal to the product of (x) the Series H Percentage and (y) the
aggregate number of New Series C Warrants.
1.72 Series H Equity Interest means an Equity Interest represented by the
Series H Preferred Stock.
1.73 Series H Percentage means the quotient, expressed as a percentage,
obtained by dividing (i) the aggregate liquidation preference of the Series H
Preferred Stock (as increased by (x) the aggregate liquidation preference of all
pay-in-kind dividends declared and paid from inception through the Commencement
Date and (y) all accrued and unpaid dividends, whether declared or not, through
the Commencement Date), by (ii) the sum of the aggregate liquidation preference
of the Series F Preferred Stock, the Series G Preferred Stock and the Series H
Preferred Stock (with respect to the Series F Preferred Stock and Series G
Preferred Stock, as increased by the aggregate liquidation preference of all
accrued and unpaid dividends, whether declared or not, through the Commencement
Date, and with respect to the Series H Preferred Stock, as increased by the
aggregate liquidation preference of (x) all pay-in-kind dividends declared and
paid from inception through the Commencement Date and (y) all accrued and unpaid
dividends, whether declared or not, through the Commencement Date).
1.74 Series H Preferred Stock means the Series H 13.5% Cumulative
Redeemable Exchangeable Preferred Stock governed by the Certificate of
Designations for the Series H Preferred Stock.
1.75 Stockholders' Agreement means the Stockholders' Agreement by and among
CHI Energy, Inc. and the stockholders of CHI Energy, Inc., which shall be in
substantially the form of Exhibit I annexed hereto.
1.76 Unofficial Bondholders' Committee means the unofficial committee of
certain holders of Senior Discount Note Claims formed prior to the Commencement
Date.
1.77 Unofficial Bondholders' Committee Expenses means the fees and expenses
outstanding on the Effective Date incurred by the Unofficial Bondholders'
Committee on behalf of the holders of Allowed Senior Discount Note Claims
(including, without limitation, the fees and expenses of counsel) in connection
with the negotiation and documentation of the Plan, the Plan-related documents
and the Chapter 11 Case.
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ARTICLE II - TREATMENT OF ADMINISTRATIVE EXPENSE CLAIMS AND PRIORITY TAX CLAIMS
2.1 PROFESSIONAL COMPENSATION AND REIMBURSEMENT CLAIMS. All entities that
are awarded compensation for services rendered or reimbursement of expenses by
the Bankruptcy Court under subsections 503(b)(2), 503(b)(3), 503(b)(4) or
503(b)(5) of the Bankruptcy Code shall be paid in full in such amounts as are
Allowed by the Bankruptcy Court (a) upon the later of (i) the Effective Date and
(ii) the date upon which an order granting such Administrative Expense Claim is
signed by the Bankruptcy Judge, or (b) upon such other terms as may be mutually
agreed upon between such holder of an Administrative Expense Claim and the
Debtor or, on and after the Effective Date, Reorganized CHI.
2.2 OTHER ADMINISTRATIVE EXPENSE CLAIMS. Except to the extent that any
entity entitled to payment of any Allowed Administrative Expense Claim agrees to
a different treatment, each holder of an Allowed Administrative Expense Claim
other than those Claims provided for under Section 2.1 shall receive Cash in an
amount equal to such Allowed Administrative Expense Claim on the later of the
Effective Date and the date such Administrative Expense Claim becomes an Allowed
Administrative Expense Claim, or as soon thereafter as is practicable; provided,
however, that Allowed Administrative Expense Claims representing liabilities
incurred in the ordinary course of business by the Debtor in Possession or
liabilities arising under loans or advances to or other obligations incurred by
the Debtor in Possession, to the extent authorized and approved by the
Bankruptcy Court if such authorization and approval was required under the
Bankruptcy Code, shall be paid in full and performed by Reorganized CHI in the
ordinary course of business in accordance with the terms and subject to the
conditions of any agreements governing, instruments evidencing or other
documents relating to, such transactions.
2.3 PRIORITY TAX CLAIMS. Except to the extent that a holder of an Allowed
Priority Tax Claim has been paid by the Debtor prior to the Effective Date or
agrees to a different treatment, at the Debtor's option, each holder of an
Allowed Priority Tax Claim (a) shall be paid in full by Reorganized CHI in the
ordinary course of business in accordance with the terms and conditions of any
law, regulation, agreement, instrument or other document relating to such Claim
or (b) shall receive on account of such Allowed Claim deferred Cash payments
having a value, as of the Effective Date, equal to such Allowed Priority Tax
Claim, over a period not exceeding six years after the date of assessment of
such Allowed Priority Tax Claim.
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ARTICLE III - CLASSIFICATION OF CLAIMS AND EQUITY INTERESTS
Claims, other than Administrative Expense Claims and Priority Tax Claims,
and Equity Interests are classified for all purposes, including voting,
confirmation and distribution pursuant to the Plan, as follows:
CLASS STATUS
Class 1 -- Other Priority Claims................................... Unimpaired
Class 2 -- Secured Claims ......................................... Unimpaired
Class 3 -- Senior Discount Note Claims............................... Impaired
Class 4 -- DnB Facility Claim...................................... Unimpaired
Class 5 -- General Unsecured Claims................................ Unimpaired
Class 6 -- Intercompany Claims .....................................Unimpaired
Class 7 -- Series F Equity Interests................................. Impaired
Class 8 -- Series H Equity Interests................................. Impaired
Class 9 -- Series G Equity Interests................................. Impaired
Class 10 -- Old Common Stock Equity Interests......................... Impaired
ARTICLE IV - TREATMENT OF CLAIMS AND EQUITY INTERESTS AND VOTING
The Allowed Claims against, and Allowed Equity Interests in, CHI shall be
treated, and holders thereof shall be entitled to vote, as follows:
4.1 CLASS 1 - OTHER PRIORITY CLAIMS
(a) Impairment and Voting. Class 1 is unimpaired by the Plan. Each holder
of an Allowed Other Priority Claim is conclusively presumed to have accepted the
Plan and is not entitled to vote to accept or reject the Plan.
(b) Treatment. To the extent unpaid prior to the Effective Date and except
to the extent that a holder of an Allowed Other Priority Claim agrees to a
different treatment, each Allowed
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Other Priority Claim shall be reinstated or rendered unimpaired in accordance
with section 1124 of the Bankruptcy Code.
4.2 CLASS 2 - SECURED CLAIMS
(a) Impairment and Voting. Class 2 is unimpaired by the Plan. Each holder
of an Allowed Secured Claim is conclusively presumed to have accepted the Plan
and is not entitled to vote to accept or reject the Plan.
(b) Treatment. Except to the extent that a holder of an Allowed Secured
Claim agrees to a different treatment, each Allowed Secured Claim shall be
reinstated or rendered unimpaired in accordance with section 1124 of the
Bankruptcy Code, notwithstanding any contractual provision or applicable
nonbankruptcy law that entitles the holder of an Allowed Secured Claim to demand
or receive payment of such Allowed Secured Claim prior to the stated maturity of
such Allowed Secured Claim from and after the occurrence of a default.
4.3 CLASS 3 - SENIOR DISCOUNT NOTE CLAIMS
(a) Impairment and Voting. Class 3 is impaired by the Plan. The beneficial
holders of Allowed Senior Discount Note Claims are entitled to vote to accept or
reject the Plan.
(b) Treatment. Each holder of an Allowed Senior Discount Note Claim shall
receive, in full satisfaction of such Allowed Senior Discount Note Claim, its
Pro Rata Share of (a) 10,000,000 shares of New Common Stock; and (b) the Class 3
Cash Payment.
(c) Allocation of Principal and Interest. All distributions to holders of
Allowed Senior Discount Note Claims shall be allocated first to the original
principal amount of each of such Claims (as determined for federal income tax
purposes) and then, to the extent the consideration exceeds such amount, to the
remainder of such Claim.
(d) Unofficial Bondholders' Committee Expenses. Notwithstanding anything to
the contrary contained herein, the portion of the Class 3 Cash Payment
consisting of the Unofficial Bondholders' Committee Expenses will be distributed
directly to the parties to whom such fees and expenses are owing.
4.4 CLASS 4 - DNB FACILITY CLAIM
(a) Impairment and Voting. Class 4 is unimpaired by the Plan. DnB is
conclusively presumed to have accepted the Plan and is not entitled to vote to
accept or reject the Plan.
(b) Treatment. Except to the extent that DnB agrees to a different
treatment, the DnB Facility Claim shall be reinstated or rendered unimpaired in
accordance with section 1124 of the Bankruptcy Code, notwithstanding any
contractual provision or applicable nonbankruptcy law that
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entitles DnB to demand or receive payment of the DnB Facility Claim prior to the
stated maturity of such Claim from and after the occurrence of a default.
4.5 CLASS 5 - GENERAL UNSECURED CLAIMS
(a) Impairment and Voting. Class 5 is unimpaired by the Plan. Each holder
of a General Unsecured Claim is conclusively presumed to have accepted the Plan
and is not entitled to vote to accept or reject the Plan.
(b) Treatment. To the extent unpaid prior to the Effective Date and except
to the extent that a holder of an Allowed General Unsecured Claim agrees to a
different treatment, each Allowed General Unsecured Claim shall be reinstated or
rendered unimpaired in accordance with section 1124 of the Bankruptcy Code.
4.6 CLASS 6 - INTERCOMPANY CLAIMS
(a) Impairment and Voting. Class 6 is unimpaired by the Plan. Each holder
of an Intercompany Claim is conclusively presumed to have accepted the Plan and
is not entitled to vote to accept or reject the Plan.
(b) Treatment. To the extent unpaid prior to the Effective Date and except
to the extent that a holder of an Allowed Intercompany Claim agrees to a
different treatment, each Allowed Intercompany Claim shall be reinstated or
rendered unimpaired in accordance with section 1124 of the Bankruptcy Code.
4.7 CLASS 7 - SERIES F EQUITY INTERESTS
(a) Impairment and Voting. Class 7 is impaired by the Plan. Each holder of
an Allowed Series F Equity Interest is entitled to vote to accept or reject the
Plan.
(b) Treatment.
(i) If Class 8 votes to accept the Plan, on the Effective Date, each
holder of an Allowed Series F Equity Interest shall receive, in full
satisfaction of such Allowed Equity Interest, its Pro Rata Share of the
Series F Distribution; or
(ii) If Class 8 votes to reject the Plan, on the Effective Date, each
holder of an Allowed Series F Equity Interest shall receive, in full
satisfaction of such Allowed Equity Interest, its Pro Rata Share of (x) the
Series F Distribution, and (y) the Series G Distribution.
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4.8 CLASS 8 - SERIES H EQUITY INTERESTS
(a) Impairment and Voting. Class 8 is impaired by the Plan. Each holder of
an Allowed Series H Equity Interest is entitled to vote to accept or reject the
Plan.
(b) Treatment. On the Effective Date, each holder of an Allowed Series H
Equity Interest shall receive, in full satisfaction of such Allowed Equity
Interest, its Pro Rata Share of the Series H Distribution.
4.9 CLASS 9 - SERIES G EQUITY INTERESTS
(a) Impairment and Voting. Class 9 is impaired by the Plan. Each holder of
an Allowed Series G Equity Interest is entitled to vote to accept or reject the
Plan.
(b) Treatment.
(i) If Class 8 votes to accept the Plan, on the Effective Date, each
holder of an Allowed Series G Equity Interest shall receive, in full
satisfaction of such Allowed Equity Interest, its Pro Rata Share of the
Series G Distribution; or
(ii) If Class 8 votes to reject the Plan, the holders of Allowed
Series G Equity Interests will not receive any distributions on account of
such Equity Interests and the share certificates or any other instruments
evidencing any Series G Equity Interest shall be deemed cancelled without
further action under any applicable agreement, law, regulation, order or
rule.
4.10 CLASS 10 - OLD COMMON STOCK EQUITY INTERESTS
(a) Impairment and Voting. Class 10 is impaired by the Plan. Each holder of
an Allowed Old Common Stock Equity Interest is conclusively presumed to have
rejected the Plan and is not entitled to vote to accept or reject the Plan.
(b) Treatment. The holders of Allowed Old Common Stock Equity Interests
will not receive any distributions on account of such Equity Interests. On the
Effective Date, and in accordance with Section 9.1 of the Plan, the Old Common
Stock certificates shall be cancelled without further action under any
applicable agreement, law, regulation, order or rule, and the Old Common Stock
evidenced thereby shall be extinguished.
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ARTICLE V - PROVISIONS REGARDING DISTRIBUTION
5.1 METHOD OF DISTRIBUTIONS UNDER THE PLAN.
(a) In General. Subject to Bankruptcy Rule 9010, all distributions under
the Plan shall be made by Reorganized CHI to the holder of each Allowed Claim as
of the Distribution Record Date at the address of such holder as listed on the
Schedules and to the holder of each Allowed Old Preferred Stock Equity Interest
as of the Distribution Record Date at the address of such holder as listed in
the transfer ledger for Old Preferred Stock, unless, in either instance, the
Debtor or Reorganized CHI has been notified in writing of a change of address,
including, without limitation, by the filing of a proof of Claim or Equity
Interest by such holder that provides an address for such holder different from
the address reflected on the Schedules (for holders of Allowed Claims) or on the
transfer ledger (for holders of Allowed Old Preferred Stock Equity Interests).
(b) Distributions of Cash. At the option of Reorganized CHI, any payment of
Cash made by Reorganized CHI pursuant to the Plan shall be made by check or wire
transfer.
(c) Timing of Distributions. Any payment or distribution required to be
made under the Plan on a day other than a Business Day shall be made on the next
succeeding Business Day.
(d) Minimum Distributions. No payment of Cash less than one hundred dollars
shall be made by Reorganized CHI to any holder of a Claim unless a request
therefor is made in writing to Reorganized CHI in accordance with Section 14.9
of the Plan.
(e) Fractional Shares or Warrants. No fractional shares of New Common Stock
or fractional New Warrants or Cash in lieu thereof shall be distributed under
the Plan. When any distribution on account of an Allowed Claim or Allowed Equity
Interest pursuant to the Plan would otherwise result in the issuance of a number
of shares of New Common Stock or New Warrants that is not a whole number, the
actual distribution of shares of New Common Stock or New Warrants shall be
rounded as follows: (a) fractions of 1/2 or greater shall be rounded to the next
higher whole number and (b) fractions of less than 1/2 shall be rounded to the
next lower whole number. The total number of shares of New Common Stock or New
Warrants to be distributed to a Class of Claims or Equity Interests, as the case
may be, shall be adjusted as necessary to account for the rounding provided in
this Section 5.1(e).
(f) Unclaimed Distributions. Any distributions under the Plan that are
unclaimed for a period of one year after distribution thereof shall be revested
in Reorganized CHI and any entitlement of any holder of any Allowed Claim or
Allowed Equity Interest to such distributions shall be discharged and forever
barred. If any distribution to any holder is returned as undeliverable,
Reorganized CHI shall use reasonable efforts to determine the current address of
such holder, but no distribution to such holder shall be made unless and until a
determination has been made concerning the then-current address of such holder,
at which time such distribution
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shall be made to such holder without interest. Amounts in respect of any
undeliverable distributions made by Reorganized CHI shall be returned to
Reorganized CHI until such distribution is claimed. If no proofs of Claim or
Equity Interest are filed and the Schedules filed with the Bankruptcy Court fail
to state addresses for holders of Allowed Claims or Allowed Equity Interests,
the distributions in respect of such Allowed Claims or Allowed Equity Interests
shall be deemed unclaimed property under section 347(b) of the Bankruptcy Code.
All unclaimed property shall revert to Reorganized CHI and such Claim or Equity
Interest shall be discharged and forever barred.
(g) Distributions to Holders as of the Distribution Record Date. As of the
close of business on the Distribution Record Date, the claims register (for
Claims) and the transfer ledgers (for Equity Interests) shall be closed, and
there shall be no further changes in the record holders of any Claims or Equity
Interests. The Debtor and Reorganized CHI shall have no obligation to recognize
any transfer of any Claims or Equity Interests occurring after the Distribution
Record Date. The Debtor and Reorganized CHI shall instead be entitled to
recognize and deal for all purposes under the Plan with only those record
holders stated on the claims register (for Claims) and transfer ledgers (for
Equity Interests) as of the close of business on the Distribution Record Date.
(h) Hart-Scott-Rodino Compliance. Any shares of New Common Stock to be
distributed under the Plan to any entity required to file a Premerger
Notification and Report Form under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended, shall not be distributed until the notification and
waiting periods applicable under such Act to such entity shall have expired or
been terminated.
5.2 WAIVER OF ENFORCEMENT OF PRIORITY. Generally, the Plan does not take
into account the relative priority of the Equity Interests in Classes 7, 8 and 9
as set forth in the Restated Certificate of Incorporation of Consolidated Hydro,
Inc. and any subordination provisions relating thereto. Pursuant to the Plan and
if Class 8 votes to accept the Plan, (a) on the Effective Date, (i) all holders
of Class 7 Equity Interests will be deemed to have waived any and all priority
and subordination rights that they may have with respect to distributions to
holders of Class 8 Equity Interests and Class 9 Equity Interests pursuant to the
Plan, and (ii) all holders of Class 8 Equity Interests will be deemed to have
waived any and all priority and subordination rights that they may have with
respect to distributions to holders of Class 9 Equity Interests; and (b) the
confirmation of the Plan will permanently enjoin, effective as of the Effective
Date, (x) all holders of Class 7 Equity Interests from enforcing or attempting
to enforce any such rights with respect to the distributions under the Plan to
the holders of Class 8 Equity Interests and Class 9 Equity Interests, and (y)
all holders of Class 8 Equity Interests from enforcing or attempting to enforce
any such rights with respect to the distributions under the Plan to the holders
of Class 9 Equity Interests. Notwithstanding the foregoing provision, if Class 8
votes to reject the Plan such provision shall not apply, and shall be of no
effect, to the holders of Class 8 Equity Interests.
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5.3 SURRENDER OF EXISTING SECURITIES AND AGREEMENTS. Each holder of a share
certificate, bond or other instrument evidencing a Claim or Old Preferred Stock
Equity Interest shall surrender such share certificate, bond or similar
instrument to Reorganized CHI, unless such requirement is waived by Reorganized
CHI. No distribution of property hereunder shall be made to, or on behalf of,
any such holders unless and until such share certificate, bond or similar
instrument is received by Reorganized CHI or the unavailability of such share
certificate, bond or similar instrument is established to the reasonable
satisfaction of Reorganized CHI or such requirement is waived by Reorganized
CHI. Reorganized CHI may require any holder that is unable to surrender or cause
to be surrendered any such share certificates, bonds or similar instruments to
deliver an affidavit of loss and indemnity and/or furnish a bond in form and
substance (including, without limitation, with respect to amount) reasonably
satisfactory to Reorganized CHI. Any holder that fails within the later of one
year after the Confirmation Date and the date of Allowance of its Claim or Old
Preferred Stock Equity Interest (a) if possible, to surrender or cause to be
surrendered such share certificate, bond or instrument, (b) if requested, to
execute and deliver an affidavit of loss and indemnity reasonably satisfactory
to Reorganized CHI and (c) if requested, to furnish a bond reasonably
satisfactory to Reorganized CHI, shall be deemed to have forfeited all rights,
claims and causes of action against the Debtor and Reorganized CHI and shall not
participate in any distribution hereunder.
ARTICLE VI - PROCEDURES FOR TREATING DISPUTED CLAIMS AND EQUITY INTERESTS
6.1 PROSECUTION OF OBJECTIONS. Unless otherwise ordered by the Bankruptcy
Court after notice and a hearing, the Debtor or Reorganized CHI shall have the
exclusive right (except as to applications for allowances of compensation and
reimbursement of expenses under sections 330 and 503 of the Bankruptcy Code) to
make and file objections to proofs of Administrative Expense Claims, Claims and
Equity Interests. The Debtor or Reorganized CHI shall serve a copy of each
objection upon the holder of the Administrative Expense Claim, Claim or Equity
Interest to which the objection is made as soon as practicable, but in no event
later than thirty days after the Effective Date.
6.2 NO DISTRIBUTIONS PENDING ALLOWANCE. Notwithstanding any other provision
hereof, if any portion of a Claim or Equity Interest is Disputed, no payment or
distribution shall be made on account of such Claim or Equity Interest, unless
and until such Disputed Claim or Disputed Equity Interest becomes Allowed.
6.3 DISTRIBUTIONS AFTER ALLOWANCE. Payments and distributions to each
holder of a Claim or Equity Interest that is Disputed, or that is not Allowed,
to the extent that such Claim or Equity Interest ultimately becomes Allowed,
shall be made in accordance with the provisions hereof governing the Class of
Claims or Equity Interests in which such Claim or Equity Interest is classified.
As soon as practicable after the date that the order or judgment of the
Bankruptcy Court allowing any Disputed Claim or Disputed Equity Interest becomes
a Final Order, Reorganized CHI shall distribute to the holder of such Claim or
Equity Interest any payment or property that would
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have been distributed to such holder if the Claim or Equity Interest had been
Allowed as of the Effective Date (or such other date on which such distribution
would have been made), without any interest on such payment or property.
ARTICLE VII - EXECUTORY CONTRACTS AND UNEXPIRED LEASES
7.1 ASSUMPTION OR REJECTION OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES.
Pursuant to sections 365(a) and 1123(b)(2) of the Bankruptcy Code, all executory
contracts and unexpired leases that exist between the Debtor and any person
shall be deemed assumed by Reorganized CHI as of the Effective Date, except for
any executory contract or unexpired lease (a) that has been assumed or rejected
pursuant to an order of the Bankruptcy Court entered prior to the Confirmation
Date, (b) as to which a motion for approval of the rejection of such executory
contract or unexpired lease has been filed and served prior to the Confirmation
Date or (c) that is set forth in Schedule 7.1 hereto; provided, however, that
the Debtor or Reorganized CHI reserves the right, on or prior to the
Confirmation Date, to amend Schedule 7.1 to delete any executory contract or
unexpired lease therefrom or add any executory contract or unexpired lease
thereto, in which event such executory contract(s) or unexpired lease(s) shall
be deemed to be, respectively, assumed or rejected. The Debtor or Reorganized
CHI shall provide notice of any amendments to Schedule 7.1 to the executory
contracts and unexpired leases affected thereby prior to the Confirmation
Hearing. The listing of a document on Schedule 7.1 shall not constitute an
admission by the Debtor or Reorganized CHI that such document is an executory
contract or an unexpired lease or that the Debtor or Reorganized CHI has any
liability thereunder.
7.2 APPROVAL OF ASSUMPTION OR REJECTION OF EXECUTORY CONTRACTS AND
UNEXPIRED LEASES. Entry of the Confirmation Order shall constitute (a) the
approval, pursuant to sections 365(a) and 1123(b)(2) of the Bankruptcy Code, of
the assumption of all executory contracts and unexpired leases that are assumed
pursuant to Section 7.1 of the Plan, (b) the extension of time, pursuant to
section 365(d)(4) of the Bankruptcy Code, within which the Debtor may assume or
reject any unexpired leases hereof through the date of entry of an order
approving the assumption or rejection of such unexpired leases, and (c) the
approval, pursuant to sections 365(a) and 1123(b)(2) of the Bankruptcy Code, of
the rejection of the executory contracts and unexpired leases set forth in
Schedule 7.1 that are rejected pursuant to Section 7.1 of the Plan.
7.3 CURE OF DEFAULTS. Except as may otherwise be agreed to by the parties,
on the Effective Date, Reorganized CHI shall cure any and all undisputed
defaults under any executory contract or unexpired lease assumed pursuant to the
Plan in accordance with section 365(b)(1) of the Bankruptcy Code. All disputed
defaults that are required to be cured shall be cured either within 30 days of
the entry of a Final Order determining the amount, if any, of the Debtor's or
Reorganized CHI's liability with respect thereto, or as may otherwise be agreed
to by the parties.
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7.4 REJECTION OF CERTAIN PUT AND CALL AGREEMENTS. The Put and Call
Agreements between (i) the Debtor and SES Partners, L.P. I and (ii) the Debtor
and SES Partners, L.P. II are treated as executory contracts and, pursuant to
sections 365(a) and 1123(b)(2) of the Bankruptcy Code, are rejected as of the
Effective Date.
7.5 BAR DATE FOR FILING PROOFS OF CLAIM RELATING TO EXECUTORY CONTRACTS AND
UNEXPIRED LEASES REJECTED PURSUANT TO THE PLAN. Claims arising out of the
rejection of an executory contract or unexpired lease pursuant to this Article
VII must be filed with the Bankruptcy Court and served upon the attorneys for
the Debtor no later than thirty days after the later of (a) notice of entry of
an order approving the rejection of such executory contract or unexpired lease
or (b) notice of entry of the Confirmation Order. Any Claims not filed within
such time will be forever barred from assertion against the Debtor, its estate,
Reorganized CHI and its property. Unless otherwise ordered by the Bankruptcy
Court, all Claims arising from the rejection of executory contracts and
unexpired leases shall be treated as General Unsecured Claims under the Plan.
7.6 INSURANCE POLICIES. Each of the Debtor's insurance policies and any
agreements, documents or instruments relating thereto are treated as executory
contracts under the Plan. Notwithstanding the foregoing, distributions under the
Plan to any holder of a Claim covered by any of such insurance policies and
related agreements, documents or instruments that are assumed hereunder, shall
be in accordance with the treatment provided under Article IV of the Plan.
Nothing contained in this Section 7.6 shall constitute or be deemed a waiver of
any claim, right or cause of action that the Debtor may hold against the insurer
under any policy of insurance, or against the holder of a Claim covered by
insurance policies.
7.7 INDEMNIFICATION OBLIGATIONS. For purposes of the Plan, the obligations
of the Debtor to defend, indemnify, reimburse or limit the liability of present
and former directors, officers or employees who were directors, officers or
employees, respectively, on or after the Commencement Date against any claims or
obligations pursuant to the Debtor's certificate of incorporation or by-laws,
applicable state law or specific agreement, or any combination of the foregoing,
shall survive confirmation of the Plan, remain unaffected thereby, and not be
discharged irrespective of whether indemnification, defense, reimbursement or
limitation is owed in connection with an event occurring before, on or after the
Commencement Date.
7.8 COMPENSATION AND BENEFIT PROGRAMS. Except as provided in Section 7.1 of
the Plan and unless otherwise modified, terminated or rejected on or before the
Effective Date, all employment, consulting and severance practices and policies,
and all compensation and benefit plans, policies, and programs of the Debtor
applicable to its directors, officers, employees, consultants or independent
contractors, including, without limitation, all savings plans, retirement plans,
health care plans, severance benefit plans, incentive plans, workers'
compensation programs and life, disability and other insurance plans are treated
as executory contracts under the Plan and hereby are assumed pursuant to
sections 365(a) and 1123(b)(2) of the Bankruptcy Code.
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7.9 RETIREE BENEFITS. Payments, if any, due to any person for the purpose
of providing or reimbursing payments for retired employees and their spouses and
dependents for medical, surgical, or hospital care benefits, or benefits in the
event of sickness, accident, disability, or death under any plan, fund, or
program (through the purchase of insurance or otherwise) maintained or
established in whole or in part by the Debtor prior to the Commencement Date
shall be continued for the duration of the period the Debtor has obligated
itself to provide such benefits.
ARTICLE VIII - LIMITED RELEASES
8.1 LIMITED RELEASE OF RELEASEES AND OTHER PARTIES. Except as otherwise
provided in the Plan, as of the Effective Date, each of the Debtor, the Debtor
in Possession and each holder of a Claim against or Equity Interest in the
Debtor or Debtor in Possession releases all Releasees, the lenders under the DnB
Facility, the holders of the Senior Discount Notes, the holders of the Old
Preferred Stock and the holders of the Old Common Stock, from claims,
obligations, rights, causes of action and liabilities held by the Debtor, Debtor
in Possession or such holder against such individuals and entities, whether
known or unknown, existing or hereafter arising, based in whole or in part upon
any act or omission or other event occurring prior to the Commencement Date or
during the course of the Chapter 11 Case, including through the Effective Date,
in any way relating to the Debtor, the Debtor in Possession, the Chapter 11
Case, the Plan, the DnB Facility Agreement, the Senior Discount Notes, the Old
Preferred Stock and the Old Common Stock, and the ownership, management and
operation of the Debtor.
8.2 LIMITED RELEASE BY RELEASEES AND OTHER PARTIES. Except as otherwise
provided in the Plan, as of the Effective Date, each of the Releasees, in any
capacity, the lenders under the DnB Facility, the holders of the Senior Discount
Notes, the holders of the Old Preferred Stock and the holders of the Old Common
Stock, generally releases each of the Debtor, the Debtor in Possession, and each
holder of a Claim against or Equity Interest in the Debtor or Debtor in
Possession, in each case in any capacity, from claims, obligations, rights,
causes of action and liabilities held by such Releasee, the lenders under the
DnB Facility, the holders of the Senior Discount Notes, the holders of the Old
Preferred Stock and the holders of the Old Common Stock against the Debtor, the
Debtor in Possession or any such Releasee or holder, whether known or unknown,
existing or hereafter arising, based in whole or in part upon any act or
omission or other event occurring prior to the Commencement Date or during the
course of the Chapter 11 Case, including through the Effective Date, in any way
relating to the Debtor, the Debtor in Possession, the Chapter 11 Case, the Plan,
the DnB Facility Agreement, the Senior Discount Notes, the Old Preferred Stock
and the Old Common Stock, and the ownership, management and operation of the
Debtor.
8.3 BINDING EFFECT OF RELEASES. On the Effective Date, each Releasee and
each holder of a Claim and each holder of an Equity Interest shall be deemed to
have agreed to the provisions of Section 8.1 and 8.2 of the Plan, and shall be
bound thereby for all purposes whatsoever.
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ARTICLE IX - IMPLEMENTATION OF THE PLAN
9.1 CANCELLATION OF CERTAIN SECURITIES. On the Effective Date, (a) all Old
Common Stock then issued and outstanding or held in CHI's treasury and (b) if
Class 8 votes to reject the Plan, all Series G Preferred Stock, shall be
cancelled and extinguished, and no consideration will be paid or delivered with
respect thereto, in all events without any action on the part of CHI,
Reorganized CHI or any other entity. The share certificates or any other
instruments evidencing any Old Common Stock Equity Interest or Series G Stock
Equity Interest, if Class 8 votes to reject the Plan, shall be deemed cancelled
without further action under any applicable agreement, law, regulation, order or
rule and the obligations of CHI under any agreement or certificate of
designation governing such Equity Interests will be discharged.
9.2 NEW SECURITIES.
(a) Authorization. As of the Effective Date, the issuance of (i) 9,085,517
shares of New Class A Common Stock, (ii) 914,483 shares of New Class B Common
Stock, (iii) 10,000,000 additional shares of New Common Stock (which may be
issued as either New Class A Common Stock or New Class B Common Stock) and (iv)
10,000,000 shares of new preferred stock by Reorganized CHI is hereby authorized
without further act or action under applicable law, regulation, order or rule.
(b) Issuance. The following new securities shall be issued pursuant to the
Plan without further act or action under applicable law, regulation, order or
rule:
(i) 10,000,000 shares of New Common Stock to be issued to the holders
of the Senior Discount Notes;
(ii) 810,811 New Series B Warrants;
(iii) 526,316 New Series C Warrants; and
(iv) 810,811 Management Options.
(c) Reserve. The following new securities shall be reserved for issuance
pursuant to the New Series B Warrant Agreement, the New Series C Warrant
Agreement and the Management Option Plan, in each case without further act or
action under applicable law, regulation, order or rule:
(i) 810,811 shares of New Common Stock, to be reserved for the New
Series B Warrants;
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(ii) 526,316 shares of New Common Stock to be reserved for the New
Series C Warrants; and
(iii) 810,811 shares of New Class A Common Stock to be reserved for
the Management Options.
9.3 REGISTRATION RIGHTS. Each person or entity receiving a distribution of
New Common Stock, New Warrants or New Common Stock issued upon the exercise of
the New Warrants or the Management Options pursuant to the Plan shall be
entitled to become a party to the Registration Rights Agreement.
9.4 EFFECTUATING DOCUMENTS AND FURTHER TRANSACTIONS. The Debtor or
Reorganized CHI is authorized to execute, deliver, file or record such
contracts, instruments, releases, indentures and other agreements or documents
and take such actions as may be necessary or appropriate to effectuate and
further evidence the terms and conditions of the Plan and any notes or
securities issued pursuant to the Plan.
9.5 CORPORATE ACTION. On the Effective Date, all matters provided for under
the Plan that would otherwise require approval of the shareholders or directors
of the Debtor or Reorganized CHI under the Plan, including, without limitation,
the issuance of New Common Stock, New Warrants and Management Options, the
effectiveness of the Amended CHI By-Laws and the Restated CHI Certificate of
Incorporation, the election or appointment, as the case may be, of directors and
officers of Reorganized CHI pursuant to the Plan, and the authorization and
approval of the Management Option Plan and the Employment Agreements shall be
deemed to have occurred and shall be in effect from and after the Effective Date
pursuant to the applicable general corporation law of the states of Delaware,
without any requirement of further action by the shareholders or directors of
the Debtor or Reorganized CHI. On the Effective Date or as soon thereafter as is
practicable, Reorganized CHI shall, if required, file its Restated CHI
Certificate of Incorporation with the Secretary of State of Delaware, in
accordance with the applicable general corporation law of the state of Delaware.
9.6 STOCKHOLDERS' AGREEMENT. Upon its effectiveness, the Stockholders'
Agreement attached hereto as Exhibit I shall bind each holder (including each
original recipient and transferee of an original recipient or other transferee)
of the New Common Stock and the New Common Stock issued upon exercise of the New
Warrants and Management Options. The Stockholders' Agreement shall become
effective on or after the Effective Date when executed by the holders of Allowed
Senior Discount Notes Claims receiving 66-2/3% or more of the New Common Stock
distributed under the Plan. The Stockholders' Agreement will remain in effect
until terminated in accordance with its terms.
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ARTICLE X - GOVERNANCE AND MANAGEMENT OF REORGANIZED CHI
10.1 GENERAL. On the Effective Date, the management, control and operation
of Reorganized CHI shall become the general responsibility of the Board of
Directors of Reorganized CHI, who shall, thereafter, have the responsibility for
the management, control and operation of Reorganized CHI.
10.2 MEETINGS OF REORGANIZED CHI STOCKHOLDERS. In accordance with the
Restated CHI Certificate of Incorporation and the Amended CHI By-Laws, as the
same may be amended from time to time, the first annual meeting of the
stockholders of Reorganized CHI shall be held on a date in 1998 selected by the
Board of Directors of Reorganized CHI, and subsequent meetings of the
stockholders of Reorganized CHI shall be held at least once annually each year
thereafter.
10.3 DIRECTORS AND OFFICERS OF REORGANIZED CHI.
(a) Board of Directors. The Stockholders' Agreement provides for a seven
member board of directors and sets forth certain procedures governing the
nomination and election of directors. The board will consist of two members of
the Company's management, one independent outside director, two directors
designated by Swiss Bank Corporation and two directors designated by Morgan
Stanley & Co. Incorporated. On the Effective Date, Morgan Stanley & Co.
Incorporated and Swiss Bank Corporation will each designate one of their two
directors. At anytime thereafter, either or both may designate their second
director and cause such person to be elected to the Board of Directors, without
further action by the directors or shareholders of Reorganized CHI. The identity
of the initial members of the Board of Directors of Reorganized CHI will be
disclosed at or immediately prior to the Confirmation Hearing. Each of the
members of such initial Board of Directors shall serve until the first annual
meeting of stockholders of Reorganized CHI or his or her earlier resignation or
removal in accordance with the Restated CHI Certificate of Incorporation or
Amended CHI By-Laws, as the same may be amended from time to time.
(b) Officers. The officers of CHI immediately prior to the Effective Date
shall serve as the initial officers of Reorganized CHI on and after the
Effective Date. Such officers shall serve in accordance with the Employment
Agreements, or any other applicable employment agreement with Reorganized CHI,
and applicable nonbankruptcy law.
10.4 AMENDED BY-LAWS AND RESTATED CERTIFICATE OF INCORPORATION. The Amended
CHI By-Laws and the Restated CHI Certificate of Incorporation shall become
effective as of the Effective Date and shall, among other things: (a) prohibit
the issuance of nonvoting equity securities as required by section 1123(a)(6) of
the Bankruptcy Code, subject to further amendment of such certificate of
incorporation and by-laws as permitted by applicable law and (b) effectuate the
provisions of the Plan, in each case without any further action by the
shareholders or directors of CHI, the Debtor in Possession or Reorganized CHI,
and (c) provide that the name of CHI shall be changed to CHI Energy, Inc..
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10.5 MANAGEMENT OPTION PLAN. If not adopted by the Debtor prior to the
Effective Date, Reorganized CHI shall adopt a stock option plan, the form of
which is annexed hereto as Exhibit D (the "Management Option Plan"). Under the
Management Option Plan, Reorganized CHI shall enter into stock option agreements
with key employees, the forms of which also are annexed hereto as Exhibit D (the
"Management Option Agreements"). Pursuant to the Management Option Agreements,
Reorganized CHI shall issue the Management Options to key employees in
accordance with the vesting schedule set forth in the Management Option Plan.
10.6 EMPLOYMENT AGREEMENTS. As of the Effective Date, the Debtor or
Reorganized CHI shall have entered into the Employment Agreements.
ARTICLE XI - EFFECTIVENESS OF THE PLAN
11.1 CONDITIONS PRECEDENT TO EFFECTIVENESS. The Plan shall not become
effective unless and until the following conditions shall have been satisfied or
waived pursuant to Section 11.3 of the Plan:
(a) Confirmation Order. The Confirmation Order, in form and substance
reasonably acceptable to the Debtor, the Unofficial Bondholders' Committee
and the Creditors' Committee, shall have been signed by the Bankruptcy
Judge, and there shall not be a stay or injunction in effect with respect
thereto;
(b) Working Capital Facility. Reorganized CHI shall have credit
availability under a working capital facility, in amount, form and
substance acceptable to the Debtor, Unofficial Bondholders' Committee and
the Creditors' Committee, if any, to provide Reorganized CHI with (i)
access to letters of credit for projects; (ii) working capital to meet its
ordinary and peak requirements and (iii) additional borrowings to support
future projects.
(c) Execution and Delivery of Certain Agreements. The following
agreements, in form satisfactory to the Debtor, the Unofficial Bondholders'
Committee and the Creditors' Committee, if any, shall have been executed
and delivered, and all conditions precedent thereto shall have been
satisfied:
(i) Amended CHI By-Laws;
(ii) Restated CHI Certificate of Incorporation;
(iii) Employment Agreements;
(iv) New Series B Warrant Agreement;
(v) New Series C Warrant Agreement;
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(vi) Management Option Plan and Management Option Agreements;
(vii) Registration Rights Agreement; and
(viii) Stockholders' Agreement.
(d) Documentation. All actions, documents and agreements necessary to
implement the Plan shall have been effected or executed.
11.2 EFFECT OF FAILURE OF CONDITIONS. In the event that one or more of the
conditions specified in Section 11.1 of the Plan have not occurred or been duly
waived by the Debtor, Unofficial Bondholders' Committee and the Creditors'
Committee, if any, as provided in Section 11.3 on or before 60 days after the
Confirmation Date, upon notification submitted by the Debtor to the Bankruptcy
Court and to counsel for the Unofficial Bondholders' Committee and the
Creditors' Committee, if any, (a) the Confirmation Order shall be vacated, (b)
no distributions under the Plan shall be made, (c) the Debtor and all holders of
Claims and Equity Interests shall be restored to the status quo ante as of the
day immediately preceding the Confirmation Date as though the Confirmation Date
never occurred and (d) the Debtor's obligations with respect to the Claims and
Equity Interests shall remain unchanged and nothing contained herein shall
constitute or be deemed a waiver or release of any Claims or Equity Interests by
or against the Debtor or any other person or to prejudice in any manner the
rights of the Debtor or any person in any further proceedings involving the
Debtor.
11.3 WAIVER OF CONDITIONS. The Debtor may waive, by a writing signed by an
authorized representative of each of the Debtor, the Unofficial Bondholders'
Committee and the Creditors' Committee, if any, and subsequently filed with the
Bankruptcy Court, one or more of the conditions precedent to effectiveness of
the Plan set forth in this Article XI.
ARTICLE XII - EFFECT OF CONFIRMATION OF PLAN
12.1 TERM OF BANKRUPTCY INJUNCTION OR STAYS. All injunctions or stays
provided for in the Chapter 11 Case under sections 105 or 362 of the Bankruptcy
Code, or otherwise, and in existence on the Confirmation Date, shall remain in
full force and effect until the Effective Date. From and after the Effective
Date, any "50-percent shareholder" of the Debtor within the meaning of section
382(g)(4)(D) of the Internal Revenue Code of 1986, as amended, shall be
permanently enjoined from claiming a worthless stock deduction with respect to
its Equity Interest for any taxable year of such shareholder ending prior to the
Effective Date.
12.2 REVESTING OF ASSETS. The property of the estate of the Debtor shall
revest in Reorganized CHI on the Effective Date, and thereafter Reorganized CHI
may operate its business, and may use, acquire and dispose of property free of
any restrictions imposed under the Bankruptcy Code. As of the Effective Date,
all property of the Debtor and Reorganized CHI shall be free and
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clear of all Liens, claims and interests of holders of Claims and Equity
Interests, except as provided in the Plan.
12.3 DISCHARGE OF DEBTOR. The rights afforded herein and the treatment of
all Claims and Equity Interests herein shall be in exchange for and in complete
satisfaction, discharge and release of Claims and Equity Interests of any nature
whatsoever, including any interest accrued on such Claims from and after the
Commencement Date, against the Debtor and the Debtor in Possession, or any of
its assets or properties. Except as otherwise provided herein, (a) on the
Effective Date, all such Claims against and Equity Interests in the Debtor shall
be satisfied, discharged and released in full, and (b) all persons shall be
precluded from asserting against Reorganized CHI or its assets or properties any
other or further Claims or Equity Interests based upon any act or omission,
transaction or other activity of any kind or nature that occurred prior to the
Confirmation Date.
12.4 PERMANENT INJUNCTION. Except as otherwise expressly provided in the
Plan or the Confirmation Order, all entities who have held, hold or may hold
Claims against or Equity Interests in the Debtor, are permanently enjoined, on
and after the Effective Date, from (a) commencing or continuing in any manner
any action or other proceeding of any kind with respect to any such Claim or
Equity Interest, (b) the enforcement, attachment, collection or recovery by any
manner or means of any judgment, award, decree or order against the Debtor on
account of any such Claim or Equity Interest, (c) creating, perfecting or
enforcing any encumbrance of any kind against the Debtor or against the property
or interests in property of the Debtor on account of any such Claim or Equity
Interest and (d) asserting any right of setoff, subrogation or recoupment of any
kind against any obligation due from the Debtor or against the property or
interests in property of the Debtor on account of any such Claim or Equity
Interest. Such injunction shall extend to successors of the Debtor (including,
without limitation, Reorganized CHI) and its respective properties and interests
in property.
ARTICLE XIII - RETENTION OF JURISDICTION
The Bankruptcy Court shall have exclusive jurisdiction of all matters
arising out of, and related to, the Chapter 11 Case and the Plan pursuant to,
and for the purposes of, sections 105(a) and 1142 of the Bankruptcy Code and
for, among other things, the following purposes:
13.1 To hear and determine pending applications for the assumption or
rejection of executory contracts or unexpired leases, if any are pending, and
the allowance of Claims resulting therefrom;
13.2 To determine any and all adversary proceedings, applications and
contested matters;
13.3 To ensure that distributions to holders of Allowed Claims and Allowed
Equity Interests are accomplished as provided herein;
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13.4 To hear and determine any timely objections to Administrative Expense
Claims, or to proofs of Claims or Equity Interests filed, both before and after
the Confirmation Date, including without limitation, any objections to the
classification of any Claim or Equity Interest, and to allow or disallow any
Disputed Claim or Disputed Equity Interest;
13.5 To enter and implement such orders as may be appropriate in the event
the Confirmation Order is for any reason stayed, revoked, modified or vacated;
13.6 To issue such orders in aid of execution and consummation of the Plan,
to the extent authorized by section 1142 of the Bankruptcy Code;
13.7 To consider any amendments to or 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;
13.8 To hear and determine all applications for compensation and
reimbursement of expenses of professionals under sections 330, 331 and 503(b) of
the Bankruptcy Code;
13.9 To hear and determine disputes arising in connection with the
interpretation, implementation or enforcement of the Plan;
13.10 To recover all assets of the Debtor and property of the Debtor's
estate, wherever located;
13.11 To hear and determine matters concerning state, local and federal
taxes in accordance with sections 346, 505 and 1146 of the Bankruptcy Code;
13.12 To hear any other matter not inconsistent with the Bankruptcy Code;
and
13.13 To enter a final decree closing the Chapter 11 Case.
ARTICLE XIV - MISCELLANEOUS PROVISIONS
14.1 EXEMPTION FROM TRANSFER TAXES. Pursuant to section 1146(c) of the
Bankruptcy Code, the issuance, transfer or exchange of notes or equity
securities under the Plan, the creation of any mortgage, deed of trust or other
security interest, the making or assignment of any lease or sublease, or the
making or delivery of any deed or other instrument of transfer under, in
furtherance of, or in connection with the Plan, including, without limitation,
any merger agreements or agreements of consolidation, deeds, bills of sale or
assignments executed in connection with any of the transactions contemplated
under the Plan shall not be subject to any stamp, real estate transfer, mortgage
recording or other similar tax.
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14.2 EXCULPATION. Neither the Debtor, Reorganized CHI, the Unofficial
Bondholders' Committee nor the Creditors' Committee, if any, nor any of their
respective members, officers, directors, employees, advisors or agents shall
have or incur any liability to any holder of a Claim or Equity Interest for any
act or omission in connection with, related to, or arising out of, the Chapter
11 Case, the pursuit of confirmation of the Plan, the consummation of the Plan
or the administration of the Plan or the property to be distributed under the
Plan, except for willful misconduct or gross negligence, and, in all respects,
the Debtor, Reorganized CHI, the Bondholder' Committee and the Creditors'
Committee, if any, and each of their respective members, officers, directors,
employees, advisors and agents shall be entitled to rely upon the advice of
counsel with respect to their duties and responsibilities under the Plan.
14.3 TERMINATION OF CREDITORS' COMMITTEE. If a Creditors' Committee is
appointed, the appointment of the Creditors' Committee shall terminate on the
later of the Effective Date and the date of the hearing to consider applications
for final allowances of compensation and reimbursement of expenses.
14.4 PAYMENT OF STATUTORY FEES. All fees payable pursuant to section 1930
of the title 28 of the United States Code, as determined by the Bankruptcy Court
at the Confirmation Hearing, shall be paid on the Effective Date.
14.5 AMENDMENT OR MODIFICATION OF THE PLAN. Alterations, amendments or
modifications of the Plan may be proposed in writing by the Debtor at any time
prior to the Confirmation Date in accordance with Section 1127(a) of the
Bankruptcy Code, provided that the Plan, as altered, amended or modified,
satisfies the conditions of sections 1122 and 1123 of the Bankruptcy Code, and
the Debtor shall have complied with section 1125 of the Bankruptcy Code;
provided, however, that the holders of Claims and Equity Interests agree or
consent to such alteration, amendment or modification or if the proposed
alteration, amendment or modification does not materially and adversely change
the treatment of the Claim or Equity Interest of such holder.
14.6 SEVERABILITY. In the event that the Bankruptcy Court determines, prior
to the Confirmation Date, that any provision in the Plan is invalid, void or
unenforceable, such provision shall be invalid, void or unenforceable only with
respect to the holder or holders of such Claims or Equity Interests as to which
the provision is determined to be invalid, void or unenforceable. The
invalidity, voidness or unenforceability of any such provision shall in no way
limit or affect the enforceability and operative effect of any other provision
of the Plan.
14.7 REVOCATION OR WITHDRAWAL OF THE PLAN. The Debtor reserves the right to
revoke or withdraw the Plan prior to the Confirmation Date. If the Debtor
revokes or withdraws the Plan prior to the Confirmation Date, then the Plan
shall be deemed null and void. In such event, nothing contained herein shall
constitute or be deemed a waiver or release of any claims by or against the
Debtor or any other person or to prejudice in any manner the rights of the
Debtor or any person in any further proceedings involving the Debtor.
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14.8 BINDING EFFECT. The Plan shall be binding upon and inure to the
benefit of the Debtor, the holders of Claims and Equity Interests, and their
respective successors and assigns, including, without limitation, Reorganized
CHI.
14.9 NOTICES. All notices, requests and demands to or upon the Debtor or
Reorganized CHI to be effective shall be in writing and, unless otherwise
expressly provided herein, shall be deemed to have been duly given or made when
actually delivered or, in the case of notice by facsimile transmission, when
received and telephonically confirmed, addressed as follows:
If to the Debtor:
Consolidated Hydro, Inc.
680 Washington Boulevard
Stamford, Connecticut 06901
Attn: Mr. Edward M. Stern
Telephone: (203) 425-8850
Facsimile: (203) 425-8880
with copies to:
Weil, Gotshal & Manges LLP Richards, Layton & Finger, P.A.
767 Fifth Avenue One Rodney Square
New York, New York 10153 Wilmington, Delaware 19899
Attn: Lori R. Fife, Esq. Attn: Thomas L. Ambro, Esq.
Telephone: (212) 310-8000 Telephone: (302) 658-6541
Facsimile: (212) 310-8007 Facsimile: (302) 658-6548
If to the Unofficial Bondholders' Committee:
Wachtell Lipton Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attn: Chaim J. Fortgang, Esq.
Telephone: (212) 403-1000
Facsimile: (212) 403-2000
14.10 GOVERNING LAW. Except to the extent the Bankruptcy Code, Bankruptcy
Rules or other federal law is applicable, or to the extent an exhibit to the
Plan provides otherwise, the rights and obligations arising under the Plan shall
be governed by, and construed and enforced in accordance with, the laws of the
State of Delaware, without giving effect to the principles of conflicts of law
of such jurisdiction.
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14.11 WITHHOLDING AND REPORTING REQUIREMENTS. In connection with the
consummation of the Plan, the Debtor or Reorganized CHI, as the case may be,
shall comply with all withholding and reporting requirements imposed by any
federal, state, local or foreign taxing authority and all distributions
hereunder shall be subject to any such withholding and reporting requirements.
14.12 PLAN SUPPLEMENT. Any and all exhibits or schedules not filed with the
Plan shall be contained in the Plan Supplement and filed with the Clerk of the
Bankruptcy Court at least 10 days prior to the Confirmation Hearing. Upon its
filing with the Bankruptcy Court, the Plan Supplement may be inspected in the
office of the Clerk of the Bankruptcy Court during normal court hours. Holders
of Claims or Equity Interests may obtain a copy of the Plan Supplement upon
written request to the Debtor in accordance with Section 14.9 of the Plan.
14.13 ADMINISTRATIVE EXPENSES INCURRED AFTER THE CONFIRMATION DATE.
Administrative expenses incurred by the Debtor or Reorganized CHI after the
Confirmation Date, including, without limitation, claims for professionals' fees
and expenses, shall not be subject to application and may be paid by the Debtor
or reorganized CHI, as the case may be, in the ordinary course of business and
without further approval of the Bankruptcy Court.
14.14 SECTION 1125(e) OF THE BANKRUPTCY CODE. (a) The Debtor has, and upon
confirmation of the Plan shall be deemed to have, solicited acceptances of the
Plan in good faith and in compliance with the applicable provisions of the
Bankruptcy Code, and (b) the Debtor, each of the members of the Unofficial
Bondholders' Committee (and each of their respective affiliates, agents,
directors, officers, employees, advisors and attorneys) have participated in
good faith and in compliance with the applicable provisions of the Bankruptcy
Code in the offer, issuance, sale, solicitation and purchase of the securities
offered and sold under the Plan, and therefore are not, and on account of such
offer, issuance, sale, solicitation and/or purchase shall not be, liable at any
time for the violation of any applicable law, rule or regulation governing the
solicitation of acceptances or rejections of the Plan or the offer, issuance,
sale or purchase of the securities offered and sold under the Plan.
14.15 HEADINGS. Headings are used in the Plan for convenience and reference
only, and shall not constitute a part of the Plan for any other purpose.
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14.16 EXHIBITS AND SCHEDULES. All Exhibits and Schedules to the Plan,
including the Plan Supplement, are incorporated into and are a part of the Plan
as if set forth in full herein.
Dated: Stamford, Connecticut
August 8, 1997
CONSOLIDATED HYDRO, INC., a Delaware corporation
By:______________________________________________
Name: Edward M. Stern
Title: President and Chief Operating Officer
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TABLE OF CONTENTS
PAGE
ARTICLE I - DEFINITION OF TERMS AND RULES OF INTERPRETATION................ 1
ARTICLE II - TREATMENT OF ADMINISTRATIVE EXPENSE CLAIMS
AND PRIORITY TAX CLAIMS....................................... 10
2.1 PROFESSIONAL COMPENSATION AND REIMBURSEMENT CLAIMS............ 10
2.2 OTHER ADMINISTRATIVE EXPENSE CLAIMS........................... 10
2.3 PRIORITY TAX CLAIMS........................................... 10
ARTICLE III - CLASSIFICATION OF CLAIMS AND EQUITY INTERESTS................ 11
ARTICLE IV - TREATMENT OF CLAIMS AND EQUITY INTERESTS AND VOTING........... 11
4.1 CLASS 1 - OTHER PRIORITY CLAIMS............................... 11
4.2 CLASS 2 - SECURED CLAIMS...................................... 12
4.3 CLASS 3 - SENIOR DISCOUNT NOTE CLAIMS......................... 12
4.4 CLASS 4 - DNB FACILITY CLAIM.................................. 12
4.5 CLASS 5 - GENERAL UNSECURED CLAIMS............................ 13
4.6 CLASS 6 - INTERCOMPANY CLAIMS................................. 13
4.7 CLASS 7 - SERIES F EQUITY INTERESTS........................... 13
4.8 CLASS 8 - SERIES H EQUITY INTERESTS........................... 14
4.9 CLASS 9 - SERIES G EQUITY INTERESTS........................... 14
4.10 CLASS 10 - OLD COMMON STOCK EQUITY INTERESTS.................. 14
ARTICLE V - PROVISIONS REGARDING DISTRIBUTION.............................. 15
5.1 METHOD OF DISTRIBUTIONS UNDER THE PLAN........................ 15
5.2 WAIVER OF ENFORCEMENT OF PRIORITY............................. 16
5.3 SURRENDER OF EXISTING SECURITIES AND AGREEMENTS............... 17
ARTICLE VI - PROCEDURES FOR TREATING DISPUTED CLAIMS AND EQUITY INTERESTS.. 17
6.1 PROSECUTION OF OBJECTIONS..................................... 17
6.2 NO DISTRIBUTIONS PENDING ALLOWANCE............................ 17
6.3 DISTRIBUTIONS AFTER ALLOWANCE................................. 17
ARTICLE VII - EXECUTORY CONTRACTS AND UNEXPIRED LEASES..................... 18
7.1 ASSUMPTION OR REJECTION OF EXECUTORY CONTRACTS
AND UNEXPIRED LEASES.......................................... 18
7.2 APPROVAL OF ASSUMPTION OR REJECTION OF EXECUTORY CONTRACTS
AND UNEXPIRED LEASES........................................ 18
7.3 CURE OF DEFAULTS.............................................. 18
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7.4 REJECTION OF CERTAIN PUT AND CALL AGREEMENTS.................. 19
7.5 BAR DATE FOR FILING PROOFS OF CLAIM RELATING TO
EXECUTORY CONTRACTS AND UNEXPIRED LEASES REJECTED
PURSUANT TO THE PLAN........................................ 19
7.6 INSURANCE POLICIES............................................ 19
7.7 INDEMNIFICATION OBLIGATIONS................................... 19
7.8 COMPENSATION AND BENEFIT PROGRAMS............................. 19
7.9 RETIREE BENEFITS.............................................. 20
ARTICLE VIII - LIMITED RELEASES............................................ 20
8.1 LIMITED RELEASE OF RELEASEES AND OTHER PARTIES................ 20
8.2 LIMITED RELEASE BY RELEASEES AND OTHER PARTIES................ 20
8.3 BINDING EFFECT OF RELEASES.................................... 20
ARTICLE IX - IMPLEMENTATION OF THE PLAN.................................... 21
9.1 CANCELLATION OF CERTAIN SECURITIES............................ 21
9.2 NEW SECURITIES................................................ 21
9.3 REGISTRATION RIGHTS........................................... 22
9.4 EFFECTUATING DOCUMENTS AND FURTHER TRANSACTIONS............... 22
9.5 CORPORATE ACTION.............................................. 22
9.6 STOCKHOLDERS' AGREEMENT....................................... 22
ARTICLE X - GOVERNANCE AND MANAGEMENT OF REORGANIZED CHI................... 23
10.2 MEETINGS OF REORGANIZED CHI STOCKHOLDERS...................... 23
10.3 DIRECTORS AND OFFICERS OF REORGANIZED CHI..................... 23
10.4 AMENDED BY-LAWS AND RESTATED CERTIFICATE OF INCORPORATION..... 23
10.5 MANAGEMENT OPTION PLAN........................................ 24
10.6 EMPLOYMENT AGREEMENTS......................................... 24
ARTICLE XI - EFFECTIVENESS OF THE PLAN..................................... 24
11.1 CONDITIONS PRECEDENT TO EFFECTIVENESS......................... 24
11.2 EFFECT OF FAILURE OF CONDITIONS............................... 25
11.3 WAIVER OF CONDITIONS.......................................... 25
ARTICLE XII - EFFECT OF CONFIRMATION OF PLAN............................... 25
12.1 TERM OF BANKRUPTCY INJUNCTION OR STAYS........................ 25
12.2 REVESTING OF ASSETS........................................... 25
12.3 DISCHARGE OF DEBTOR........................................... 26
12.4 PERMANENT INJUNCTION.......................................... 26
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ARTICLE XIII - RETENTION OF JURISDICTION................................... 26
ARTICLE XIV - MISCELLANEOUS PROVISIONS..................................... 27
14.1 EXEMPTION FROM TRANSFER TAXES................................. 28
14.2 EXCULPATION................................................... 28
14.3 TERMINATION OF CREDITORS' COMMITTEE........................... 28
14.4 PAYMENT OF STATUTORY FEES..................................... 28
14.5 AMENDMENT OR MODIFICATION OF THE PLAN......................... 28
14.6 SEVERABILITY.................................................. 28
14.7 REVOCATION OR WITHDRAWAL OF THE PLAN.......................... 28
14.8 BINDING EFFECT................................................ 29
14.9 NOTICES....................................................... 29
14.10 GOVERNING LAW................................................. 29
14.11 WITHHOLDING AND REPORTING REQUIREMENTS........................ 30
14.12 PLAN SUPPLEMENT............................................... 30
14.13 ADMINISTRATIVE EXPENSES INCURRED AFTER THE
CONFIRMATION DATE........................................... 30
14.14 SECTION 1125(e) OF THE BANKRUPTCY CODE........................ 30
14.15 HEADINGS...................................................... 30
14.16 EXHIBITS AND SCHEDULES........................................ 31
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INDEX OF EXHIBITS AND SCHEDULE
EXHIBITS
EXHIBIT A ................................. Form of By-Laws of CHI Energy, Inc.
EXHIBIT B ............................ Form of Restated Certificate of
Incorporation of Consolidated Hydro, Inc.
EXHIBIT C ......................................... Form of Employment Agreement
EXHIBIT D ................................ CHI Energy, Inc. 1997 Stock Option
Plan and Management Option Agreements
EXHIBIT E .................................. Form of Series B Warrant Agreement
EXHIBIT F .................................. Form of Series C Warrant Agreement
EXHIBIT G ...................................... List of Nondebtor Subsidiaries
EXHIBIT H ........................................Registration Rights Agreement
EXHIBIT I ..............................................Stockholders' Agreement
SCHEDULE
SCHEDULE 7.1 ............................... Executory Contracts and Unexpired
Leases to be Rejected
-iv-
UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE
- - - ------------------------------------ x
:
In re :
: CHAPTER 11
CONSOLIDATED HYDRO, INC., : CASE NO. _____________
:
Debtor. :
:
- - - ------------------------------------ x
PLAN OF REORGANIZATION UNDER CHAPTER 11
OF THE BANKRUPTCY CODE OF CONSOLIDATED HYDRO, INC.
WEIL, GOTSHAL & MANGES LLP
Attorneys for the Debtor
767 Fifth Avenue
New York, New York 10153
(212) 310-8000
and
RICHARDS, LAYTON & FINGER, P.A.
Attorneys for the Debtor
One Rodney Square
Wilmington, Delaware 19899
(302) 685-6541
Dated: Stamford, Connecticut
August 8, 1997
EXHIBIT A TO THE PLAN
Form of By-Laws of CHI Energy, Inc.
EXHIBIT B TO THE PLAN
Form of Restated Certificate of Incorporation of Consolidated Hydro, Inc.
EXHIBIT C TO THE PLAN
Form of Employment Agreement
EXHIBIT D TO THE PLAN
CHI Energy, Inc. 1997 Stock Option Plan and Management Option Agreements
EXHIBIT E TO THE PLAN
Form of Series B Warrant Agreement
EXHIBIT F TO THE PLAN
Form of Series C Warrant Agreement
EXHIBIT G TO THE PLAN
List of Nondebtor Subsidiaries
EXHIBIT H TO THE PLAN
Registration Rights Agreement
EXHIBIT I TO THE PLAN
Stockholders' Agreement
SCHEDULE 7.1 TO THE PLAN
Executory Contracts and Unexpired Leases to be Rejected
EXECUTORY CONTRACTS AND UNEXPIRED LEASES TO BE REJECTED
-------------------------------------------------------
1. Amended and Restated Stockholders, Optionholders and Warrantholders
Agreement among Consolidated Hydro, Inc., and its stockholders,
optionholders and warrantholders dated March 25, 1992.
2. Consolidated Hydro, Inc. Amended and Restated 1992 Stock Option Plan.
3. Put and Call Agreement dated as of June 20, 1993, by and among Consolidated
Hydro, Inc., SES Partners, L.P. and Summit Energy Storage Inc.
4. Call Agreement dated as of November 1, 1993, by and among Consolidated
Hydro, Inc., SES Partners II, L.P. and Summit Energy Storage Inc.
5. Warrant Agreement dated as of November 1, 1993, between Consolidated Hydro,
Inc. and SES Partners II, L.P.
NYFS10...:\84\38684\0003\1791\PLN6027I.52N