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IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF MARYLAND
SOUTHERN DIVISION
In re: *
SEVENTY-FIFTH AVENUE * Case No. 95-1-3103-DK
ASSOCIATES LIMITED (Chapter 11)
PARTNERSHIP, *
Debtor. *
* * * * * * * * * * *
DEBTOR'S FOURTH REVISED
PLAN OF REORGANIZATION
Seventy-Fifth Avenue Associates Limited Partnership, by Ronald S. Haft
individually and as a general partner thereof, hereby proposes this Debtor's
Fourth Revised Plan of Reorganization, pursuant to Chapter 11, Title 11 of the
United States Code.
INTRODUCTION
This Fourth Revised Plan of Reorganization sets forth the treatment of
Claims and interests in the case of Seventy-Fifth Avenue Associates Limited
Partnership.
ARTICLE I
DEFINITIONS
The terms set forth below in this Article I shall be used in this
Fourth Revised Plan of Reorganization and, when so used, unless the context
requires otherwise, shall have the meanings set forth below. A term used in
the Fourth Revised Plan that is not defined shall have the meaning ascribed to
that term, if any, by the Bankruptcy Code.
Administrative Expense(s): means those expenses and costs allowed
pursuant to section 503(b) of the Bankruptcy Code, including court costs and
professional fees incurred by the Debtor-in-Possession subsequent to the filing
of this Reorganization Case.
Allowed Claim(s): means any right to payment as defined in section
101(5) of the Bankruptcy Code: (a) in respect of which a proof of Claim has
been filed with the Bankruptcy Court
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on or before the Bar Date; or (b) which is listed in the Schedules and
Statements of Liabilities of Debtor filed by the Debtor-in-Possession with the
Bankruptcy Court, including any amendments thereto, and is not listed as
disputed, contingent or unliquidated as to amount, and which has not otherwise
been paid during the course of this bankruptcy case from any source; and, as to
any Claim, either no objection to the allowance thereof has been filed or, if
any objection has been filed, such objection has been denied by a Final Order
or the Claim fixed as to amount by a Final Order.
Bank: means The Bank of New York.
Bank Security Interest: means the liens and Security Interest of the
Bank pursuant to all of the Bank's Loan Documents, including but not limited to
a deed of trust and deed of trust note in the original amount of
$16,000,000.00, dated December 19, 1986.
Bankruptcy Code: means the United States Bankruptcy Code, 11 U.S.C.
Section 101 et seq. as in effect from time to time.
Bankruptcy Court or Court: means the United States Bankruptcy Court
for the District of Maryland, or any court or tribunal subsequently constituted
to adjudicate matters arising under the Bankruptcy Code or any successor
bankruptcy laws promulgated by the Congress of the United States and which
assumes jurisdiction over this Reorganization Case.
Bar Date: means the date established by the Bankruptcy Court for
filing proofs of Claim in this Reorganization Case; provided, however, that if
the Bankruptcy Court has ordered an extension of the time by which a particular
Creditor may file a proof of Claim, the date set with respect to such Creditor
shall be the Bar Date with respect to such Creditor, but only as to such
Creditor.
Chapter 11: means Chapter 11 of the Bankruptcy Code.
Claim: has that meaning ascribed to it by section 101(5) of the
Bankruptcy Code.
Class: means a Claim or interest, or a group of Claims or interests,
consisting of those Claims or interests which are substantially similar to each
other, as classified under the Plan, or a
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Claim or interest or a group of Claims or interests classified by amount as may
be reasonable and necessary as administrative convenience Claims, or a group of
Claims or interests which are otherwise required to be separately classified.
Confirmation of the Plan: means the signing by the Court of an order
confirming the Plan in accordance with the provisions of Chapter 11 of the
Bankruptcy Code.
Confirmation Date: means the date of the signing by the Court of the
order of Confirmation of the Plan.
Combined Entities: means any entity through which RSH or HHH or both
now own or any time in the past have owned, operate or operated, manage or
managed, their private interests in various shopping centers, office buildings,
warehouses and other assets, including the entities set forth in Exhibit 1.1.17
attached to the Settlement Agreement.
CPI: means Combined Properties Incorporated.
CPI Management Agreement: means the Amended and Restated Exclusive
Leasing and Management Agreement by and between CPI and Seventy-Fifth Avenue
dated May 12, 1993, as amended from time to time.
Creditor: has that meaning ascribed to it in section 101(10) of the
Bankruptcy Code.
Dart: means Dart Group Corporation.
Dart Claims: means all causes of action, Claims and demands of any
nature whatsoever of Dart and its affiliates and subsidiaries including, inter
alia, Claims for the reformation of its leases with the Debtor and a refund of
rents paid.
Dart/RSH Settlement Agreement: means that agreement by and among
Ronald S. Haft and Dart among others, dated as of October 6, 1995.
Debtor or Debtor-in-Possession: means Seventy-Fifth Avenue Associates
Limited Partnership.
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Disallowed Claim(s): means any Claim (or Claims) which has been
disallowed pursuant to a Final Order.
Disputed Claim(s): means a Claim (or Claims) against the Debtor and
Debtor-in-Possession, either scheduled or to the extent that a proof of Claim
has been filed or is deemed to have been filed, as to which an objection has
been timely filed and which objection, if timely filed, has not been withdrawn
on or before any date fixed for filing such objections by order of the
Bankruptcy Court and has not been denied by a Final Order. To the extent an
objection relates to the allowance of only a part of a Claim, such Claim shall
be a Disputed Claim only to the extent of the objection.
Effective Date: means that date after the Confirmation of the Plan
when all of the terms and conditions of Article XIII of the Plan have fully
complied with.
Encroached Portion: means that portion of the real property owned
by the Debtor that is currently subject to encroachments by improvements owned
by Pennsy Drive Warehouses, L.L.C.
Equity Security: means the interest of a limited partner in the
Debtor.
Executory Contract: means any unexpired lease or contract to which
the Debtor and Debtor-in-Possession is a party and which is executory within
the meaning of section 365 of the Bankruptcy Code.
Final Order: means an order of the Court or of any court of competent
jurisdiction which has been entered and which has become final by expiration of
the time for an appeal therefrom or, if an appeal(s) is taken, by resolution of
such appeal(s) in favor of one of the parties thereto and the expiration of the
time for further appeal(s) therefrom.
Headquarters Newco: means 75th Avenue Headquarters, L.L.C., a limited
liability company to be formed pursuant to the laws of the State of Delaware
whose sole members are in Dart's discretion Trak Auto, Crown Books Corporation
or Dart and/or other entities wholly owned by Trak Auto, Crown Books
Corporation and/or Dart. .
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Herbert Haft Assertions: means those causes of action, choses in
action, Claims, interests and demands of any nature whatsoever, known or
unknown, which have been or could be asserted by Herbert H. Haft against the
Debtor, including but not limited to all of those causes of action which have
been or could have been brought in the Superior Court Litigation.
Indemnification Claims: means the indemnification and/or guaranty
Claims, if any, of Gloria G. Haft, Robert M. Haft, Linda G. Haft and their
family trusts against the Debtor, which Claims, if any, arise out of, inter
alia, the Indemnification Agreement of July 31, 1994 and the Heads of Agreement
of May 17, 1994.
Insider: has the meaning ascribed to that term by section 101(31) of
the Bankruptcy Code.
Loan Documents: means any notes, deeds of trust, mortgages, pledges,
assignment of rents or other similar documents memorializing an extension of
credit or financing to the Debtor.
Notice and a Hearing: has the meaning ascribed to that term by
section 102(1) of the Bankruptcy Code.
Other Family Members: means Robert M. Haft, Linda G. Haft and
Gloria G. Haft and their respective family trusts.
Partnership Agreement: means the Limited Partnership Agreement of the
Debtor as amended from time to time.
Petition Date: means May 25, 1995.
Plan: means this Fourth Revised Plan of Reorganization.
Priority Claims: means all Claims as defined in sections 507(a)(3),
(a)(4) and (a)(6) of the Bankruptcy Code only [excluding claims as defined in
sections 507(a)(1), (a)(2), (a)(5), (a)(7) and (a)(8)of the Bankruptcy Code].
Proponent(s): means Seventy-Fifth Avenue Associates Limited
Partnership, by Ronald S. Haft individually and as a general partner thereof.
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Pro Rata: means the proportion that the dollar amount of an Allowed
Claim in a particular Class or Classes bears to the aggregate dollar amount of
all Allowed Claims in such particular Class or Classes.
Rejection Claim: means any Claim arising under section 502(g) of the
Bankruptcy Code and any Claim of a holder of an Executory Contract which
pursuant to prior Order of Court is allowed as a Claim under section 502(g)of
the Bankruptcy Code.
Remaining Cash Collateral: means the cash collateral of the Debtor
remaining as of the Effective Date, after the deduction therefrom of the
amounts needed to satisfy the claims for legal fees and costs of the Class One
Creditor.
Reorganization Case: means the case of the reorganization of
Seventy-Fifth Avenue commenced by the filing of a Voluntary Petition for Relief
pursuant to Chapter 11 on or about May 25, 1995, being jointly administered and
now pending in this Court under the designation In re: Haft Equities-Bladen
Limited Partnership, et. al., Case Nos. 95-1-3093-DK through 95-1-3104-DK.
Restructured Loan: means an amended and restated deed of trust note
in the principal amount of $16,000,000.00, as well as amended and restated Loan
Documents to be executed and delivered by Headquarters Newco to the Bank
pursuant to the Plan.
Schedules: means the schedules of assets and liabilities filed by the
Debtor-in-Possession with the Bankruptcy Court.
Secured Claim: means any Allowed Claim secured by a Security
Interest.
Secured Creditor: means the holder of a Security Interest which was
properly perfected as required by law or order of this Court with respect to
property in which the Debtor-in-Possession has an interest, to the extent of
the value of the interest of the holder of such Claim in the
Debtor-in-Possession's interest in such property.
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Security Interest: means mortgage, deed of trust, chattel mortgage,
pledge, assignment of rent, pledge, unavoidable judgment lien of record, tax
lien of record, or consensual lien recorded in the appropriate jurisdiction or
otherwise duly perfected, giving the holder thereof a validly perfected
non-preferential lien on the real or personal property of the Debtor except as
otherwise defined in the Plan.
Settlement Agreement: means the Settlement Agreement dated as of
August 14, 1996 by and between Herbert H. Haft and Ronald S. Haft, including
all Exhibits attached thereto, as well as any amendments thereto.
Seventy-Fifth Avenue: means Seventy-Fifth Avenue Associates Limited
Partnership.
Special Prepayment(s): means the payments in the aggregate amount of
$5,000,000.00 to be made by Dart to the Bank pursuant to the terms of the Plan.
75th Avenue Headquarters: means the office and warehouse located at
3300 75th Avenue, Landover, Maryland and all land, structures and improvements
with respect thereto.
75th Avenue Property: means all of Seventy-Fifth Avenue's right,
title and interest in the 75th Avenue Headquarters, as well as all rights of
Seventy-Fifth Avenue under any leases, security deposits, contract rights,
licenses, permits, certificates and all other intangible rights owned by
Seventy-Fifth Avenue and which are appurtenant to the 75th Avenue Headquarters.
Superior Court Litigation: means the consolidated law suits in the
Superior Court of the District of Columbia, Civil Division and designated:
Herbert H. Haft v Ronald S. Haft et. al., Civil Action Nos. 94-CA9883 and
95-CA12666.
Tax Claim: means all Claims of governmental units pursuant to section
507(a)(8)of the Bankruptcy Code.
Tier II Partnership: means Seventy Fifth Avenue Tier II Limited
Partnership, holder of a sixty-six and two-thirds percent (66 2/3%) limited
partnership interest in Seventy-Fifth Avenue.
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Unsecured Creditor(s): means any entity having a pre-Petition Date
non-priority Claim for which the entity did not have a Security Interest
securing that Claim.
Warehouse Lease: means the lease agreement dated December 26, 1984,
as amended by that certain Amendment to Lease Agreement also dated December 26,
1984, by and between Seventy-Fifth Avenue and Dart Group Corporation.
Wooded Lot: means the 2.66 acres of vacant land near the 75th Avenue
Headquarters.
Wooded Lot Lease: means the lease agreement dated November 22, 1988
by and between Seventy-Fifth Avenue and Dart Group Corporation pertaining to
the Wooded Lot.
ARTICLE II
PROVISION FOR ADMINISTRATIVE CLAIMS
2.01. The holder of an Administrative Expense Claim awarded by a
Final Order of the Court will receive cash equal to the unpaid portion of such
Allowed Administrative Expense Claim on the later of (a) the Effective Date and
(b) the date on which said entity becomes a holder of such Allowed
Administrative Expense Claim pursuant to a Final Order; provided, however,
those Claims that represent liabilities incurred by the Debtor-in-Possession in
the ordinary course of its business, during the pendency of this Reorganization
Case, shall be assumed by the Debtor and paid in the ordinary course of
business in accordance with the terms and conditions of any agreement relating
thereto, or as otherwise agreed.
2.02. Upon the disposition of any property (including real or
personal property, partnership interests, or partnership property) of the
Debtor-in-Possession, the Court, upon application of the Debtor-in-Possession
or any party in interest, may determine the amount of any Tax Claim accruing as
a result of the disposition of said property pursuant to section
503(b)(1)(B)(i) of the Bankruptcy Code.
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ARTICLE III
PROVISION FOR PRIORITY CLAIMS
3.01. All entities having Allowed Priority Claims shall be paid in
cash, in full, on the Effective Date by the Debtor.
ARTICLE IV
PROVISION FOR TAX CLAIMS
4.01. The balance of Allowed Tax Claims, if any, owing on the
Effective Date shall be paid at the sole discretion of the Debtor, by either
(i) equal annual cash payments on each anniversary of the Effective Date, with
interest, pursuant to 11 U.S.C. Section 507(a)(8), until the last anniversary
of the Effective Date that precedes the sixth (6th) anniversary of the date of
the assessment of such Allowed Claim, or (ii) an immediate cash payment to the
extent of cash on hand as of the Effective Date or from contributions from
Ronald S. Haft, or (iii) such other treatment as may be agreed upon by the
Debtor-in-Possession and the holder of such Allowed Tax Claim.
ARTICLE V
CLASSIFICATION OF CLAIMS AND INTERESTS OF SEVENTY-FIFTH AVENUE
5.01. Class One: Shall consist of the Allowed Secured Claim of The
Bank of New York in the real property and related assets of Seventy-Fifth
Avenue, as more particularly described in the Loan Documents related thereto.
5.02. Class Two: Shall consist of the Allowed Claims of Unsecured
Creditors against Seventy-Fifth Avenue, excluding the Dart Claims and excluding
the Indemnification Claims.
5.03. Class Three: Shall consist of the Allowed Dart Claims.
5.04. Class Four: Shall consist of the Allowed interests of the
Equity Security holders of Seventy-Fifth Avenue.
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5.05. Class Five: Shall consist of the Allowed interests of the
general partner of Seventy-Fifth Avenue.
5.06. Class Six: Shall consist of the Herbert Haft Assertions.
5.07. Class Seven: Shall consist of the Allowed Indemnification
Claims.
ARTICLE VI
TREATMENT OF CLASSES OF CLAIMS OR
INTERESTS UNDER THE SEVENTY-FIFTH AVENUE PLAN
A. THE CREDITORS AND INTERESTS OF SEVENTY-FIFTH AVENUE SHALL BE
TREATED AS FOLLOWS:
6.01. The Class One Creditor shall be paid in full and final
satisfaction, discharge and release of its Claim as follows:
(a) The Class One Creditor's Claim shall be Allowed as of
the Effective Date in the amount equal to the sum of:
(i) the principal balance of the deed of trust note
in the original and outstanding principal amount of $16,000,000.000
dated December 19, 1986, (ii) accrued and unpaid interest, if any, at
the non-default contract rate provided in the existing Loan Documents
of the Class One Creditor, (iii) all reasonable fees and expenses
provided for in the existing Loan Documents of the Class One Creditor,
including attorneys' and other professional fees, incurred by the
Class One Creditor in connection with this Reorganization Case, less
(iv) any post-petition adequate protection payments, that are in
excess of post-petition interest payments at the non-default contract
rate.
(b) In consideration for the treatment provided in this
Plan, the Class One Creditor shall waive any Claims it may assert for (x)
interest at the default rate, (y) unpaid late fees, if any, and (z) prepayment
charges permitted under its existing Loan Documents. On the Effective Date,
the Class One Creditor shall receive a payment in cash from the Debtor in an
amount equal to (i) accrued and unpaid interest, if any, at the non-default
contract rate provided in the existing Loan Documents of the Class One Creditor
and (ii) all accrued and unpaid reasonable fees and expenses provided for in
the existing Loan Documents of the Class One Creditor, including attorneys' and
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other professional fees, incurred by the Class One Creditor in connection with
this Reorganization Case
(c) On the Effective Date, fee simple title to all of the
Debtor's real property, improvements, fixtures, including all property subject
to the Warehouse Lease and the Wooded Lot Lease, and all of the Debtor's rights
under any leases, security deposits, contract rights, licenses, permits,
certificates and any intangible rights owned by the Debtor which are
appurtenant to such real property, shall be conveyed (the "Conveyance") to
Headquarters Newco. The Conveyance, and all property transferred pursuant
thereto, shall be subject to the Bank's Security Interest, as amended, and the
Warehouse Lease, as amended, pursuant to the terms of sections 6.01 and 6.03(a)
of the Plan, but not the Wooded Lot Lease. The Bank's Security Interest, as
amended, and all obligations thereunder, shall be assumed by Headquarters
Newco, and shall only be recourse to Headquarters Newco to the extent of the
assets of Headquarters Newco subject to the Security Interest of the Class One
Creditor, and shall not be recourse, directly or indirectly, as to the members
of Headquarters Newco or Ronald S. Haft, and shall be guaranteed by Dart, Trak
Auto Corporation and Crown Books Corporation pursuant to the terms of section
6.01(e)(v) of the Plan.
(d) As soon as practical on or after the Effective Date,
the real property of the Debtor shall be replatted, and fee simple title to the
Encroached Portion shall be conveyed by Headquarters Newco by quitclaim deed to
Pennsy Drive Warehouses, L.L.C., free and clear of the lien of the Deed of
Trust Loan and free and clear of any other liens or encumbrances; provided
however, that the Class One Creditor shall thereupon release the Encroached
Portion from its Security Interest, subject to (i) its review and approval
(which approval shall not be unreasonably withheld) of the subdivision plat and
legal description for both the Encroached Portion and the property remaining
subject to its Security Interest, (ii) its confirmation that the Encroached
Portion will be separately assessed for real estate tax purposes, (iii) its
confirmation that the property
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remaining subject to its Security Interest, after the release of the Encroached
Portion, complies with all subdivision and zoning laws and regulations and (iv)
its receipt of an endorsement to its title insurance policy confirming that the
title insurance is not affected by the release of the Encroached Portion.
(e) On the Effective Date, Headquarters Newco shall
execute and deliver the Restructured Loan which shall contain the following
terms and conditions:
(i) The Restructured Loan shall be dated as of the
Effective Date and shall have a term of five (5) years, with all
unpaid indebtedness due and payable on the fifth anniversary of the
Effective Date.
(ii) The Restructured Loan shall bear interest at a
fixed (the "Fixed Rate Option") or adjustable rate (the "Adjustable
Rate Option"), at the election of Dart, to be exercised five (5)
business days before the Effective Date.
(iii) The Fixed Rate Option shall be equal to the
sum of (A) 200 basis points in excess of the rate on U.S. treasury
instruments having a maturity date closest to the maturity date of the
Restructured Loan, with such fixed rate to be determined as of the
Confirmation of the Plan, provided the Effective Date occurs within
thirty (30) days thereafter; otherwise to be determined five (5)
business days prior to the Effective Date, plus (B) the Bank's actual
swap spread for loans having maturities equal to that of the
Restructured Loan, not to exceed 50 basis points.
(iv) The Adjustable Rate Option shall be equal to
200 basis points in excess of the one-year LIBOR, with such rate to be
determined as of the Confirmation of the Plan, provided the Effective
Date occurs within thirty (30) days thereafter; otherwise to be
determined five (5) business days prior to the Effective Date.
Thereafter the interest rate on the outstanding balance of the
Restructured Loan shall be reset on each anniversary of the Effective
Date to a rate equal to the one-year LIBOR plus 200 basis points,
LIBOR to be determined as of each such anniversary date.
(v) Payment of the Restructured Loan and performance
of all of Headquarter Newco's obligations under the Restructured Loan
shall be guaranteed by Dart, pursuant to the terms of an unconditional
and irrevocable guarantee to be executed and delivered to the Bank on
the Effective Date. Trak Auto Corporation and Crown Books
Corporation, respectively, shall also execute and deliver guaranties
limited in amount to that percentage of the Restructured Loan equal to
the percentage of floor space of 75th Avenue Headquarters that each
occupies pursuant to its respective sub-lease with Dart, as of the
Effective Date.
(vi) The Restructured Loan shall be secured by
valid, perfected and first priority liens and security interests in
and to the real property, improvements and
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fixtures that are subject to the Warehouse Lease (except for the
Encroached Portion), the Warehouse Lease (as modified pursuant to the
Plan) and all other property, rights and interests of the Debtor,
whether or not subject to the existing Security Interest of the Class
One Creditor. As additional security for the Restructured Loan the
Class One Creditor shall have an assignment of and be entitled to
receive directly form Dart, all amounts payable by Dart to
Headquarters Newco under the Warehouse Lease as amended pursuant to
the terms of the Plan and Headquarters Newco shall irrevocably direct
Dart to remit to the Class One Creditor such portion of the monthly
rental payments due under the Warehouse Lease (as amended pursuant to
the terms of the Plan) as is necessary to pay the monthly debt service
to the Class One Creditor under the Restructured Loan.
(vii) If the Fixed Rate Option has been elected,
debt service shall be constant equal monthly payments of principal and
interest in an amount sufficient to fully amortize the $11,000,000.00
principal balance of the Restructured Loan in ten years after the
Effective Date (after giving effect to the Special Prepayments,
provided for in section 6.01(f) of the Plan as if they were both made
on the Effective Date). If the Adjustable Rate Option has been
elected, debt service shall be monthly payments of interest at the
then applicable rate plus monthly payments of principal in the amount
of $91,666.67 until the Restructured Loan is paid in full. Under
either option elected, the first such debt service payment will be due
on the first day of the month following the month in which the
Effective Date occurs, provided that the first payment shall be
adjusted such that interest is paid in arrears.
(viii) If the Fixed Rate Option has been elected,
Headquarters Newco's right to prepay the Restructured Loan prior to
the stated maturity (except for the Special Prepayments provided for
in section 6.03(f) of the Plan) shall be subject to a yield
maintenance provision contained in the Restructured Loan. If the
Adjustable Rate Option has been elected, then Headquarters Newco may
prepay the Restructured Loan, or any part thereof, without penalty on
any anniversary date of the Effective Date, at the expiration of the
then applicable LIBOR interest contract.
(ix) Such representations, warranties, covenants,
conditions and defaults that are substantially similar in nature and
scope to those in the existing Loan Documents and which are in a form
and substance satisfactory to the Bank, Dart, Headquarters Newco and
the Debtor.
(f) On the Effective Date, Dart shall deposit
$5,000,000.00 with the Class One Creditor for the account of Dart.
$2,500,000.00 will be available to and will, on the Effective Date, fund the
first Special Prepayment (and upon such funding will be considered prepaid rent
by Dart under the Warehouse Lease). The remaining $2,500,000.00 will be
available to and will fund the second Special Prepayment (and upon such funding
will be considered prepaid rent by Dart under the Warehouse Lease). While said
funds are on deposit, they shall be invested for Dart's account,
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as Dart may from time to time direct, in securities issued or backed by the
United States Government. No entity or person other than Dart shall have any
rights in or to said funds while on deposit, provided, however, that the Class
One Creditor shall have its common law right of set off and a Security Interest
in said deposit and the proceeds thereof to secure the second Special
Prepayment which shall be due on August 15, 1997.
(g) On the Effective Date, the Class One Creditor shall
release Robert M. Haft, Linda G. Haft, Ronald S. Haft and Herbert H. Haft,
respectively, as to any Claims arising out of the Class One Creditor's existing
Loan Documents, provided, that concurrently therewith, the Class One Creditor
receives from such person a release of any Claims such person may have against
the Class One Creditor arising out of the Class One Creditor's existing Loan
Documents. The exchange of such mutual releases between the Class One
Creditor and any one or more of such persons shall not be (i) dependent upon
the exchange of mutual releases between the Class One Creditor and any other
person, nor (ii) a precondition to the Confirmation of the Plan.
6.02. The Class Two Creditors shall be paid in full and final
satisfaction, discharge and release of their Claims as follows:
(a) Each holder of an Allowed Class Two Claim, if any, shall
receive from cash on hand as of the Effective Date or, to the extent thereafter
needed, from contributions from Ronald S. Haft cash payments in an amount equal
to one hundred percent (100%) of its Allowed Claim, as follows:
(i) Seventy-Fifth Avenue shall first satisfy all
Allowed Administrative Expense Claims, Priority Claims and Tax Claims;
and
(ii) Thereafter, on a monthly basis following the
Effective Date, the holders of Allowed Class Two Claims, if any, shall
receive Pro Rata cash distributions, from the cash on hand as of the
Effective Date or, to the extent thereafter needed, from contributions
from Ronald S. Haft, until such time as they receive one hundred
percent (100%) of such Allowed Claims.
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6.03. The Class Three Creditor shall be treated in full and final
satisfaction of its Claims as follows:
(a) On the Effective Date, Headquarters Newco and the
Class Three Creditor shall execute an amendment of the existing Warehouse
Lease, which amendment shall provide, inter alia, that the Class Three Creditor
pay monthly, as basic rent, a sum equal to the corresponding regularly
scheduled monthly installment of principal and interest due and payable from
time to time under the Restructured Loan.
(b) The Class Three Creditor's rent obligations shall
include the Special Prepayments which the Class Three Creditor shall be
obligated to make as prepaid rent in compliance with the terms and conditions
of section 6.01(f) of the Plan. The rent under the amended Warehouse Lease
shall automatically readjust to reflect (i) the adjusted monthly debt service
on the remaining outstanding balance of the Restructured Loan after each of the
Special Prepayments is made, including but not limited to the first Special
Prepayment which shall be paid on the Effective date, and (ii) any adjustments
in the interest rate if the Adjustable Rate Option is elected (as set forth in
section 6.01(d) of the Plan). In the event of any other prepayments of
principal allowed under the Restructured Loan documents or consented to by the
Class One Creditor, such prepayments shall also result in corresponding
reductions of the Class Three Creditor's monthly payment of rent obligations
under the amended Warehouse Lease.
(c) The Restructured Loan documents and the amended
Warehouse Lease shall provide that the Restructured Loan cannot be refinanced
or otherwise modified in any way without the prior written consent of the Class
Three Creditor.
(d) The Wooded Lot Lease shall be terminated as of the
Effective Date.
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(e) Apart from the treatment provided in this section 6.03 and
as otherwise provided in the Plan, the Class Three Creditor shall not receive
any distributions or payments in satisfaction of its Claims, and the Dart
Claims shall be deemed discharged upon the Confirmation of the Plan.
6.04. The Class Four Equity Security holders of Seventy-Fifth Avenue
shall be treated as follows:
(a) The holder of any Equity Security of Seventy-Fifth
Avenue shall retain its Equity Security in the reorganized Debtor subject to
the terms and conditions of Article VII of the Plan.
6.05. The Class Five general partnership interests shall be treated
as follows:
(a) The general partner shall retain his general
partnership interest in the reorganized Debtor subject to the terms and
conditions of Article VII of the Plan.
6.06. The Class Six Herbert Haft Assertions shall be treated as
follows:
(a) The Class Six Herbert Haft Assertions shall be
treated as set forth in and subject to the terms and conditions of Article VII
of the Plan.
6.07. The Class Seven Indemnification Claimants shall be treated as
follows:
(a) The Class Seven Indemnification Claimants shall be
treated as set forth in and subject to the terms and conditions of Article VII
of the Plan.
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ARTICLE VII
Capital Restructuring for the Reorganized Debtor
7.01. Herbert H. Haft shall not receive any distributions from the
Debtor on account of the Herbert Haft Assertions.
7.02. On the Effective Date or on such other date as may be agreed
upon by and among Robert M. Haft, Linda G. Haft and Dart, Robert M. Haft and
Linda G. Haft shall each receive a cash distribution, pursuant to the terms of
section 8.02.1 of the Plan, in respect of their limited partnership interest in
the Tier II Partnership.
7.03. Except as expressly provided for under the Plan, the Claims
and interests of Ronald S. Haft, Robert M. Haft, Herbert H. Haft and Linda G.
Haft shall not receive any payments or other distributions under the Plan.
7.03.1 To the extent of any allowed Indemnification Claims that are
not satisfied from any other source, Ronald S. Haft shall either (i) satisfy
such Claims, or (ii) cause such amounts to be contributed to the Debtor as may
be necessary to satisfy such Claims.
ARTICLE VIII
MEANS FOR EXECUTION OF THE PLAN
8.01. On the Effective Date, fee simple title to all of the Debtor's
real property, improvements, fixtures, including all property subject to the
Warehouse Lease and the Wooded Lot Lease, and all of the Debtor's rights under
any leases, security deposits, contract rights, licenses, permits, certificates
and any intangible rights owned by the Debtor which are appurtenant to such
real property, shall be conveyed to Headquarters Newco, free and clear of all
Claims, rights of possession, liens and encumbrances, except as expressly set
forth in the Plan.
8.01.1 As soon as possible after the Effective Date, the real
property conveyed to Headquarters Newco shall, subject to the terms of Section
6.01(d) of the Plan, be subdivided, so that
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the fee simple title to the Encroached Portion shall be conveyed by quitclaim
deed to Pennsy Drive Warehouses L.L.C., free and clear of the liens of the
Class One Creditor, as well as any other liens and encumbrances.
8.02. On or about the Effective Date, the Debtor-in-Possession
shall, in accordance with the terms and conditions of the Plan, pay, in cash,
to the respective holders of Allowed Administrative Expense Claims and Allowed
Priority Claims an amount equal to that holder's respective Allowed Claim. The
Debtor-in-Possession shall thereafter, in accordance with the terms and
conditions of the Plan, commence distributions to the holders of Allowed Claims
and interests. CPI on behalf of the Debtor-in-Possession shall act as
disbursement agent for the purpose of making those distributions provided under
the Plan.
8.02.1 On the Effective Date or on such other date as may be agreed
upon by and among Robert M. Haft, Linda G. Haft and Dart, the payments to
Robert M. Haft and Linda G. Haft, as described in section 7.02 of the Plan,
shall be made by Dart as part of the consideration paid by Dart for the
conveyance of the Debtor's Property to Headquarters Newco pursuant to the terms
of the Plan. The payments shall be in the amount of $1,562,000.00 to each of
Robert M. Haft and Linda G. Haft.
8.02.2 On the Effective Date, Dart shall deposit $5,000,000.00 with
the Class One Creditor for the account of Dart to be used to fund the Special
Prepayments.
8.02.3 On the Effective Date, the payment to the Class One Creditor
provided in section 6.01 (b) of the Plan and the payment of Allowed
Administrative Expense Claims as provided in section 2.01 of the Plan shall be
made from the cash collateral of the Debtor and the Remaining Cash Collateral,
if any, shall be conveyed to Headquarters Newco. If, however, the cash on hand
of the Debtor, as of the Effective Date, is insufficient to make the payments
to the Class One Creditor as required by section 6.01 (b) of the Plan and all
Allowed Administrative Expense Claims as required
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by section 2.01 of the Plan, Ronald S. Haft shall make a capital contribution
to the Debtor in such amount as is necessary to make such payments.
8.03. Ronald S. Haft, the general partner of the
Debtor-in-Possession, shall serve as the general partner of the Debtor after
the Effective Date.
8.04. The Debtor-in-Possession shall continue to exist after the
Effective Date in accordance with applicable non-bankruptcy law, to the extent
necessary to wind up its affairs.
8.05. The Partnership Agreement of the Debtor-in-Possession shall be
amended as necessary to satisfy the requirements of the Plan, subject to
further amendment as permitted by applicable law and by the partnership
agreement of the Tier II Partnership.
8.05.1 As soon as practical on or after the Effective Date, the
reorganized Debtor shall execute such other and further documents as are
reasonably necessary to carry out the terms and conditions of the Plan.
8.06. All avoidance actions assert able by the Debtor-in-Possession
pursuant to Sections 542 through 553 of the Bankruptcy Code shall be retained
by the Debtor; provided, however, that, any and all Claims that the
Debtor-in-Possession may have against (i) the Bank and Dart and their
respective affiliates, successors and assigns, (ii) any of the Other Family
Members and (iii) Herbert H. Haft, that arose prior to the Effective Date,
including but not limited to all avoidance actions assertable by the
Debtor-in-Possession pursuant to Sections 542 through 553 of the Bankruptcy
Code shall be deemed released as of the Effective Date and further provided
that, subject and pursuant to the terms of the Settlement Agreement, all causes
of action, if any, against Herbert H. Haft are released.
8.07. Except for the transfers and conveyances made pursuant to the
Plan and the Class One Creditor's Security Interest, the Confirmation of the
Plan shall constitute a revesting of title for all purposes of the
Debtor-in-Possession's property in said Debtor, free and clear of all liens and
Claims
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except as set forth in the Plan, no further order of court shall be required
for the Debtor to sell, convey, loan or encumber its property in any manner.
8.08. Except as otherwise expressly provided in the Plan, the
Confirmation of the Plan shall cause on the Effective Date the discharge of the
Debtor, effective immediately, from any Claim and any "debt" (as that term is
defined in section 101 of the Bankruptcy Code) and the Debtor-in-Possession's
liability in respect thereof will be extinguished completely, whether reduced
to judgment or not, liquidated or unliquidated, contingent or fixed, asserted
or unasserted, matured or unmatured, disputed or undisputed, legal or
equitable, known or unknown, that arose from any agreement that the Debtor
entered into or obligations that the Debtor-in-Possession incurred before the
Confirmation of the Plan, including without limitation, liabilities of a kind
specified in sections 502(g), (h) and (i) of the Bankruptcy Code, whether or
not a proof of Claim is filed or deemed filed under section 501 of the
Bankruptcy Code, whether or not such Claim is allowed under section 502 of the
Bankruptcy Code, or whether or not the holder of such Claim has accepted the
Plan.
8.08.1 Except as expressly set forth in the Plan, Security Interests
shall not be released by virtue of the discharge of Claims and debts which
occurs upon Confirmation of the Plan.
8.08.2 Notwithstanding any provisions of the Plan to the contrary,
the Indemnification Claims shall not be discharged. In each and every respect,
all rights of the holders of the Indemnification Claims are fully preserved,
and nothing in the Plan shall in any way affect or impair any right of any
holder of an Indemnification Claim against the Debtor, Ronald S. Haft or any
other person or entity.
8.09. Except as expressly provided in the Plan, the Confirmation of
the Plan will provide that all persons (including but not limited to
individuals, corporations, partnerships, joint ventures, associations, trusts,
estates, unincorporated organizations, and governments) who have held, hold or
may hold Claims are permanently enjoined, on and after the Confirmation of the
Plan, from:
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(a) commencing or continuing in any manner or form the
enforcement, attachment, collection or recovery, by any manner or means, of any
pre-petition Claim, judgment, award, decree or order against the Debtor or its
current or former partners solely by virtue of their status as a partner
(except to the extent such provision against the Debtor's partners alters the
rights of the holder of a Security Interest, in which event this provision
shall not apply); of creating, perfecting or enforcing any encumbrance of any
kind against the Debtor; from exercising any discretionary and/or "call"
provisions of any loan documents allowing the acceleration of Claims; from
asserting any set off, right of subrogation, or recoupment of any kind against
any obligation due from the Debtor or from any act in any manner, in any place
whatsoever, that does not conform to or comply with the provisions of the Plan;
provided, however, that proceedings may be continued only for the purpose of
obtaining a liquidation of any asserted Claims against the Debtor on the
condition that the holder of any such judgment shall be enjoined from executing
against any of the assets of the Debtor-in-Possession, and further provided
that nothing contained herein shall preclude actions commenced in the Court to
seek compliance with or to enforce the terms and conditions of the Plan.
Unless otherwise provided, the injunction provided herein shall remain in full
force and effect until the consummation of the Plan.
(b) The provisions contained in Section 8.09(a) of the
Plan, as well as the treatment of Claims provided in the Plan, shall not be
deemed or construed to preclude (i) actions or enforcement efforts necessitated
from a breach or default under the terms of the Plan or (ii) a Secured Creditor
from enforcing any remedy available to it pursuant to applicable law or its
Loan Documents based upon a post-Confirmation Date default by the Debtor under
the terms of the Secured Creditor's Loan Documents as modified by the terms and
conditions of the Plan, or (iii) any of the Other Family Members from asserting
and pursuing any rights, demands, debts, obligations
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or Claims of any nature whatsoever that they may have against the Debtor,
Ronald S. Haft , Herbert H. Haft or the Combined Entities.
8.10. The Proponents reserve the right, in accordance with the
Bankruptcy Code, to amend or modify the Plan or the treatment of any Claim
prior to the Confirmation of the Plan. After the Confirmation of the Plan, the
Proponents may amend or modify the Plan, or a portion thereof, in accordance
with section 1127(b) of the Bankruptcy Code, or remedy any defect or omission,
or reconcile any inconsistency in the Plan, in such a manner as may be
necessary to carry out the purpose and intent of the Plan; provided, however,
that no amendment, waiver, modification or supplement shall be made to the Plan
without the prior written consent of (i) Dart and the Bank, or their respective
representatives, and (ii) the Other Family Members, provided that such written
consents shall not be unreasonably conditioned, withheld or delayed.
8.11. The obligations of Dart with respect to the Plan shall be
subject to compliance with the Standstill Order, dated December 6, 1995, of the
Court of Chancery of the State of Delaware in and for New Castle County.
8.12. Headquarters Newco shall be formed on or before the Effective
Date. Its sole members, in Dart's discretion shall be Dart, Trak Auto, Crown
Books Corporation and/or subsidiaries wholly-owned by Dart, Trak Auto and/or
Crown Books Corporation The transfer of any membership interest in
Headquarters Newco, without the prior written consent of the Class One
Creditor, shall constitute an event of default under the Class One Creditor's
Loan Documents, as amended pursuant to the terms of the Plan.
8.13. Any deeds, leases, assignments, pledges, deeds of trust,
transfers of security, mortgages, modifications or other documents of
conveyance contemplated by this Plan, including but not limited to the
subdivision and conveyance of the Encroached Portion, whether made before or
after the Confirmation of the Plan, shall be deemed instruments of transfer
under a plan pursuant
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to 11 U.S.C. Section 1146 and, as a result, may not be taxed under any law
imposing a stamp or similar tax.
ARTICLE IX
JURISDICTION OF THE COURT
9.01. Notwithstanding the Confirmation of the Plan, the Court will
retain jurisdiction until consummation of the Plan to ensure that the purposes
and intent of the Plan are carried out. The Court's jurisdiction shall be over
any and all disputes and litigation pending at the time of the Confirmation of
the Plan, any controversies that may arise thereafter, and any controversies
that may affect the Debtor-in-Possession's ability to effectuate the
consummation of the Plan.
9.01.1 By way of illustration of the jurisdiction retained by the
Court, but not by way of limitation of the same, the Court shall retain
jurisdiction in this case, among other things, for the following purposes:
(a) Classification and re-examination of any Claims of
any Creditors and the determinations of any objections which may be filed
thereto, provided, however, that the Debtor-in-Possession's failure to object
to any Claim which has been allowed for the purpose of voting shall not be
deemed a waiver of the Debtor-in-Possession's right to later object thereto;
(b) The correction of any defect or omission in the Plan
and in the Confirmation of the Plan, as may be necessary to effectuate the
consummation of the Plan;
(c) The modification of the Plan after Confirmation;
(d) To determine any and all applications, Claims,
adversary proceedings, or to allow, disallow, estimate, liquidate, or determine
any Claim against the Debtor-in-Possession and to enter or enforce any order
requiring the filing of any such Claim before a particular date;
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(e) To determine any and all pending applications for
rejection or disaffirmance of Executory Contracts or leases and to hear and
determine and, if need be, to liquidate any and all Claims arising therefrom;
(f) To enter such orders as may be necessary to enforce
the injunctions provided in the Plan;
(g) To determine proceedings pursuant to Section 510 of
the Bankruptcy Code to equitably subordinate any Claim or Class of Claims; and
(h) All other matters which the Court must determine
under the Plan.
9.02. Notwithstanding the retention of jurisdiction by the
Bankruptcy Court, (i) the holders of Security Interests may, after the
Effective Date, enforce any post Confirmation Date defaults in any court of
competent jurisdiction, including state or federal courts, as applicable, and
(ii) any of the Other Family Members may enforce any or all of their rights
arising out of the Indemnification Claims in any court of competent
jurisdiction, including, as applicable any state or federal court, and provided
further that jurisdiction over any dispute arising out of or relating to the
Indemnification Claims shall not be retained by the Court.
ARTICLE X
EXECUTORY CONTRACTS
10.01. Subject to the deliveries, conveyances and agreements required
by the Plan, the Debtor-in-Possession reserves the right to apply to the Court
prior to the Confirmation of the Plan to assume or reject any Executory
Contract pursuant to 11 U.S.C. Section 365.
10.02. On the Effective Date, the Debtor shall reject the Wooded Lot
Lease and the Wooded Lot Lease shall be terminated as of the Effective Date.
Except as otherwise set forth in the Plan, the Confirmation of the Plan shall
automatically constitute an assumption and assignment by the Debtor to
Headquarters Newco of all unexpired leases in which the Debtor-in-Possession is
a lessor which
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are not otherwise provided for in the Plan which (i) have not been rejected
prior to that date, (ii) have not been assumed, in whole or in part, by prior
Order of Court or, (iii) which are not the subject of a pending application
seeking a rejection thereof. The Confirmation of the Plan shall automatically
constitute an assumption and assignment on the Effective Date by the Debtor to
Headquarters Newco of the Warehouse Lease as amended pursuant to section 6.03
of the Plan.
10.02.1 The CPI Management Agreement will terminate on the Effective
Date, without any penalty to any person or entity, including but not limited to
the Debtor or Headquarters Newco. The Debtor shall, as necessary, provide such
notice to CPI as is required to effectuate said termination.
10.03. Pursuant to Bankruptcy Rule 3002 (c)(4), and except as
otherwise ordered by the Court, proofs of Claim for Claims arising from the
rejection of an Executory Contract or unexpired lease shall be filed with the
Court no later than thirty (30) days after the later of the entry of a Final
Order approving such rejection and the Confirmation of the Plan, or such Claim
shall be forever barred.
ARTICLE XI
GENERAL PROVISIONS
11.01. To the extent a Claim is a contingent or Disputed Claim, the
Debtor-in-Possession shall not be required to make the applicable disputed
portion of a payment to a holder of such contingent or Disputed Claim which
would otherwise be payable to said contingent or Disputed Claimant. Until such
time as a contingent or Disputed Claim becomes fixed and absolute, such Claim
shall be treated as a contested Claim for purposes related to estimation,
allocations and distributions under the Plan and Disputed Claims shall not have
the ability to vote.
11.02. Nothing contained in section 11.01 of the Plan shall be
construed to prohibit the holder of a Disputed Claim or contingent Claim from
seeking an order of the Court authorizing the temporary estimation of such
Claim for voting purposes. In the event that said Claim becomes an
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Allowed Claim, then the Debtor-in-Possession shall thereafter cause to be paid
to the holder an amount which would have theretofore been paid to such holder
under the Plan had the Allowed Claim amount of such Claim been fixed and
determined as of the Effective Date in accordance with the terms of the Plan
and in the same manner as any other Creditor of the same Class.
11.03. Whenever any payment to be made under the Plan is due on a day
other than a business day, such payment will instead be made on the next
business day.
11.04 No action taken by any of the Other Family Members in the
Reorganization Case, including without limitation the filing of proofs of
claims, the filing of any pleadings, any statement made in connection with any
hearing, withdrawal of any objections to confirmation, the casting of any
ballot or withdrawal of any ballot cast in connection with the Plan shall in
any way impair or affect any Claims of any of the Other Family Members against
the Debtor, Ronald S. Haft, Herbert H. Haft or the Combined Entities, nor shall
any such action in any way constitute or be deemed to constitute any grounds
for, or give rise to, any defense to, offset of, or reduction in liability of
the Debtor, Ronald S. Haft, Herbert H. Haft, or the Combined Entities to the
Other Family Members.
ARTICLE XII
MISCELLANEOUS PROVISIONS
12.01. The adoption of the amended Partnership Agreement in
accordance with Article VII of the Plan shall be deemed to have occurred and be
effective on the Effective Date, without any further requirement of action by
the Equity Security holders. Effective as of the Effective Date Ronald S.
Haft, the general partner of the Debtor, shall, without the need for any
further order of the Court, have an irrevocable power of attorney to execute
said amendment on behalf of all limited partners of the Debtor and to execute
all documents needed to effectuate the Conveyance to Headquarters Newco
described in section 6.01(c) of the Plan.
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12.02. All applications for payment of Administrative Expense Claims
must be filed within forty-five (45) days of the Effective Date. Any such
Claim that is not filed by that date shall be forever barred and discharged.
12.03. As soon as possible, but in no event more than two (2) months
after the Effective Date, any party in interest may file and prosecute
objections to Claims and equity interests, which objections shall be filed with
the Bankruptcy Court, provided however, the Class One Claim and the Class Three
Claim shall for all purposes be allowed as provided in the Plan.
12.04. In order to confirm the Plan, and to the extent necessary, the
Debtor invokes the entitlement of Section 1129(b) of the Bankruptcy Code, such
that, as long as the Plan does not discriminate unfairly and is fair and
equitable with respect to any Class of Claims or interests that are impaired
under and have not accepted the Plan, the Plan may be confirmed by the Court.
12.05. On or before the tenth (10th) day preceding the commencement
of the hearing on the Confirmation of the Plan, the Debtor and/or any party in
interest shall file with the Court such agreements and other documents as may
be necessary or appropriate to effectuate and further evidence the terms and
conditions of the Plan, including the Class One Creditor's proposed principal
loan documents evidencing the Restructured Loan.
12.06. Should any provision of this Plan be determined to be invalid,
void or unenforceable, such determination shall not in any way limit or affect
the enforceability and operative effect of any or all other provisions of the
Plan and the Court shall, with the consent of the Proponents, the Class One
Creditor, the Class Three Creditor and the Other Family Members, have the power
to alter and interpret such term or provision to make it valid or enforceable
to the maximum extent practicable, consistent with the original purpose of the
term or provision held to be invalid, void or unenforceable, and such term or
provision shall then be applicable as altered or interpreted. Notwithstanding
any such holding, alteration or interpretation, the remainder of the terms and
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provisions of the Plan shall remain in full force and effect and in no way
shall be affected, impaired or invalidated by such holding, alteration or
interpretation. The Confirmation of the Plan shall constitute a judicial
determination and shall provide that each term and provision of the Plan, as it
may have been altered or interpreted in accordance with the foregoing, is valid
and enforceable pursuant to its terms.
12.07. All fees payable pursuant to Chapter 123 of Title 28, United
States Code, as determined by the Bankruptcy Court on the Confirmation Date,
shall be payable on the Effective Date. Any statutory fees accruing after the
Confirmation of the Plan shall constitute Administrative Expenses and be paid
in accordance with Article II of the Plan.
12.08. Until the Effective Date, all creditors and
parties-in-interests' rights to make any motion or seek any other relief
whatsoever including, but not limited to, moving for relief from the automatic
stay, appointment of a trustee or conversion or dismissal of the Debtor's
Chapter 11 case (including, without limitation, on the grounds of any failure
to consummate the Plan or the Plan to become effective) shall not be impaired
or restricted by the terms of the Plan, the Confirmation of the Plan, or by
virtue of having voted for the Plan. Following the Effective Date, the rights
of the parties shall be governed by the Plan and applicable law.
12.09. Provided that it does not delay the implementation of the
Plan, nor diminish the value of the Plan to Dart, Trak Auto or Headquarters
Newco, Dart, Trak Auto and Headquarters Newco agree to use reasonable efforts
to cooperate with the Debtor, without cost to Dart, Trak Auto or Bridgeview
Newco, in the event the Debtor elects to structure the conveyance(s) provided
in Section 6.01 of the Plan in a tax-free manner pursuant to section 1031 of
the Internal Revenue Code.
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ARTICLE XIII
EFFECTIVENESS OF THE PLAN
13.01. As a condition precedent to the effectiveness and the
Effective Date of the Plan, the following events shall have first occurred:
(a) The Confirmation of the Plan has become a Final
Order;
(b) All documents, instruments and agreements, in form
and substance satisfactory to the Proponents, provided for under or necessary
to implement the Plan shall have been executed and delivered by the parties
thereto, unless such execution or delivery shall have been waived by the
parties entitled under such documents, instruments or agreements to waive such
execution or delivery;
(c) Dart and Ronald S. Haft have executed an amendment to
the terms of the Dart/RSH Settlement Agreement, in a form mutually satisfactory
to them;
(d) Dart shall have deposited with the Class One Creditor
$5,000,000.00 for the account of Dart to be used to fund the Special
Prepayments; and
(e) Headquarters Newco shall have delivered to the Bank
(i) a certified copy of Headquarter Newco's Operating Agreement, (ii) a
certified resolution of Headquarter Newco and its corporate members, (iii) an
incumbency certificate for the managing member of Headquarters Newco and (iv)
an opinion of Headquarters Newco's counsel as to the due authorization of
Headquarters Newco's execution of the amended Loan Documents and as to their
validity, binding effect and enforceability, subject to the usual bankruptcy
and insolvency qualifications.
(f) Dart and the Other Family Members have entered into
definitive settlement agreements, by and among them, in a form mutually
acceptable to them, dealing with all matters in dispute between them and have
thereafter entered into a closing thereon.
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13.02. Any of the conditions precedent to the effectiveness and the
Effective Date of the Plan may be waived by the unanimous consent of the
Proponents, Dart, the Other Family Members and the Class One Creditor.
13.03. In the event that (i) Dart, Trak Auto, Ronald S. Haft and the
Other Family Members have not entered into definitive settlement agreements,
by and among them, by May 20, 1997, and/or (ii) have not effected the closing
of such settlement agreements by August 15, 1997, then in either such event the
Plan shall be deemed null and void and of no further force and effect at the
election of the Class One Creditor, exercised by written notice to the Debtor,
the Court and all parties in interest.
13.04. If Dart has not previously done so, promptly upon the
execution of any definitive settlement agreement among Dart, Trak Auto Robert
M. Haft, Linda G. Haft and Gloria G. Haft dealing with matters in dispute
between them, Dart and Trak Auto agree to give notice to the other parties to
the Standstill Order described in Section 8.11 of the Plan, as to the
Confirmation of the Plan, the pendency of such definitive settlement agreement,
and such other matters, if any, as Dart may in its discretion deem appropriate.
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IN THE UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF MARYLAND
SOUTHERN DIVISION
In re: *
SEVENTY-FIFTH AVENUE * Case No. 95-1-3103-DK
ASSOCIATES LIMITED (Chapter 11)
PARTNERSHIP, *
Debtor. *
* * * * * * * * * * *
ORDER CONFIRMING DEBTOR'S
FOURTH REVISED PLAN OF REORGANIZATION
A Confirmation hearing having been held on April 4, 1997 to consider
the Debtor's Third Amended Plan of Reorganization, and upon the motion of all
parties-in-interest the Court having granted leave to the Debtor to file
revisions to said plan, and the Debtor having filed the Debtor's Revised Third
Amended Plan of Reorganization on May 2, 1997 and mailed a copy of the Revised
Third Amended Plan to creditors, equity security holders and other
parties-in-interest, and the Court having entered an Order on June 12, 1997
Confirming the Debtor's Revised Third Amended Plan of Reorganization (the
"First Confirmation Order"), and the Debtor thereafter having filed a
Stipulation and Consent Order Providing for Modification of Debtor's Third
Revised Amended Plan of Reorganization and a Fourth Revised Plan of
Reorganization (the "Plan") on October 28, 1997 and, after proper notice, this
Court has determined:
1. The Plan complies with the applicable provisions of Chapter 11
of the Bankruptcy Code;
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2. The Debtor has complied with the applicable provisions of
Chapter 11 of the Bankruptcy Code;
3. The Plan has been proposed in good faith and not by any means
forbidden by law;
4. Any payment made or promised by the Debtor for services or for
costs and expenses incurred in connection with the case, or in connection with
the Plan and incident to the case, has been disclosed to the Court and is
reasonable or is subject to the approval of the Court;
5. The Debtor has disclosed the identity and affiliations of each
individual proposed to serve, after confirmation of the Plan, as a director,
officer or voting trustee of the Debtor, or a successor of the Debtor under the
Plan and the continuance of such individuals is consistent with the interests
of creditors, equity security holders and public policy, and the proponents of
the Plan have disclosed the identity of any insider that will be employed or
retained by the reorganized Debtor and the nature of any compensation for such
insider;
6. Each holder of a claim or interest has accepted the Plan, or
will receive or retain under the Plan property of a value, as of the Effective
Date of the Plan, that is not less than such holder would receive or retain if
the Debtor were liquidated under Chapter 7 of the Bankruptcy Code on such date;
7. With respect to each class of claims or interests, such class
has accepted the Plan or is not impaired under the Plan;
8. Except to the extent that the holder of a particular claim has
agreed to a different treatment of such claim, the Plan provides that:
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(a) On the Effective Date of the Plan, each holder of a
claim of a kind specified in Section 507(a)(1) of the Bankruptcy Code
will receive on account of such claim cash equal to the allowed amount
of the claim; and
(b) On the Effective Date of the Plan, each holder of a
claim of a kind specified in Section 507(a)(8) of the Bankruptcy Code
will receive on account of such claim deferred cash payments, over a
period not exceeding six years after the date of the assessment of the
claim, of a value, as of the Effective Date of the Plan, equal to the
allowed amount of the claim;
9. At least one class of impaired claims has actually accepted
the Plan, determined without including any acceptance of the Plan by any
insider;
10. All fees payable pursuant to Section 1930 have been paid or
shall be paid on the Effective Date of the Plan;
11. Confirmation of the Plan is not likely to be followed by the
liquidation or the need for further reorganization of the Debtor; and
12. It is in the best interests of the estate that the Plan be
confirmed.
This Court, therefore, finds that the Plan complies with the
requirements of 11 U.S.C. Section 1129. Accordingly, it is this 30th day
of October, 1997,
ORDERED that the First Confirmation Order is hereby vacated,
and deemed null and void and of no further force or effect; and it is further
ORDERED that the Debtor's Fourth Revised Plan of
Reorganization be, and is hereby, CONFIRMED; and it is further
ORDERED that this Court shall retain jurisdiction over this
case as set forth in Article IX of the Plan; and it is further
ORDERED any deeds, leases, assignments, pledges, deeds of
trust, transfers of security, mortgages, modifications or other documents of
conveyance contemplated by this Plan,
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including, but not limited to, the subdivision and conveyance of the Encroached
Portion, as well as the conveyance to Headquarters Newco, whether made before
or after the Confirmation of the Plan, shall be deemed instruments of transfer
under a plan pursuant to 11 U.S.C. Section 1146 and, as a result, may not be
taxed under any law imposing a stamp or similar tax; and it is further
ORDERED that this Order shall be deemed null and void and of
no further force and effect, in the event that the Class One Creditor exercises
the election specified in Section 13.03 of the Plan prior to the Effective
Date; and it is further
ORDERED that the Debtor shall mail a copy of this Order to all
creditors and parties-in-interest and shall thereafter certify such mailing.
Entered: October 31, 1997 /s/ Duncan Keir
------------------------------
DUNCAN W. KEIR
United States Bankruptcy Judge
cc: Joel I. Sher, Esquire
Sandra A. Manocchio, Esquire
Shapiro and Olander
36 South Charles Street, 20th Floor
Baltimore, MD 21201-3147
4