EXHIBIT 10.39
ATTACHMENT I
MODIFICATIONS TO SECOND AMENDED JOINT CHAPTER 11 PLAN OF REORGANIZATION
OF WILLIAMS COMMUNICATIONS GROUP, INC. AND CG AUSTRIA, INC.
Section 1.1 Definitions.
(24) "Class 5/6 Channeled Actions" means all Causes of Action of
holders of Allowed Class 5 Senior Redeemable Notes Claims and
Allowed Class 6 Other Unsecured Claims, acting in such
capacity, against a TWC Released Party or a WCG Indemnitee
(except for Causes of Action to enforce any obligation of a
TWC Released Party or WCG Indemnitee under the Plan, a Plan
Document, or the TWC Settlement Agreement) that is based in
whole or in part on any act, omission, event, condition, or
thing in existence or that occurred in whole or in part prior
to the Effective Date.
(85) "Residual Assets" means, with the exception of any (i) Assets
necessary for the operation of the business of New WCG and its
subsidiaries, including all cash and cash equivalents and
amounts maintained in securities accounts by old WCG on the
Effective Date less the amount required to satisfy all
Administrative Claims and (ii) Causes of Action against or
equity interests in any Affiliate, any and all assets of WCG,
including, but not limited to, any and all Causes of Action
against any Person other than an Affiliate.
(96) "SBC Consent" means the consent by SBC, pursuant to the SBC
Stipulation, to (a) the transactions contemplated by the
Leucadia Investment Agreement and the Leucadia Claims Purchase
Agreement; (b) the transactions contemplated by the Plan: and
(c) the Spin-Off.
(97) "SBC Stipulation" means that certain Stipulation, dated
September 23, 2002, by and between SBC Leucadia, and the
Debtors.
(100) "Securities Holder" means any current or former holder of
security issued by a WCG Entity without limitation, Equity
Interests and/or Senior Redeemable Notes) acting in such
capacity, provided, however, that "Securities Holder" shall
not include of a holder an Allowed Claim in Class 5 or 6 under
the Plan, acting in such capacity.
(101) "Securities Holder Channeled Action" means any Cause of Action
(i) of a Securities Holder against a WCG Indemnitee that is
based in whole or in part on any act, omission, event,
condition, or thing in existence or that occurred in whole or
in past prior to the Effective Date or (ii) of any Person for
contribution, reimbursement, or indemnity from old WCG, New
WCC, or a WCG Indemnitee, relating to a Cause of Action of a
Securities Holder, and that in not otherwise discharged,
satisfied, released, exculpated, or otherwise provided for in
or by the Plan or the Confirmation Order.
(102) "Securities Holder Channeling Fund" means (a) the right to
receive 2% of the New WCG Common Stock (on a fully-diluted
basis), to the extent that holders of Securities Holder
Channeled Actions become entitled to receive such stock
pursuant to the Securities Holder Channeling Fund Distribution
Procedures; and/or (b) any recoveries that can be obtained
from officer/director liability insurance policies of the
Company or insurance carriers that cover officers and
directors of the Company or the Company's obligation to
indemnify its officers and directors.
(131) "WCG Indemnitee" means any Affiliate and each of the present
and former directors, managers, officers, employees, agents,
and attorneys, of a WCG Entity acting in such capacity,
excluding Persons who serve or served as officers of SBC to
the extent such Persons possessed
conflicts of interest with respect to the WCG Entities while
acting as directors of WCG in connection with the Spin-Off,
provided, however, that upon written notification by SBC that
the conditions to effectiveness contained in paragraph 14 of
the SBC Stipulation have been satisfied or waived, then such
officers of SBC shall be deemed to be WCG Indemnitees.
SECTION 2.2 TREATMENT OF ADMINISTRATIVE CLAIMS.
(a) Time for Filing Administrative Claims. Except with
respect to (i) a Fee Claim, (ii) an Adequate Protection Claim, (iii) a
TWC Continuing Contract Claim, (iv) a liability incurred and paid in
the ordinary course of business by a Debtor, or (v) an Administrative
Claim that has been allowed on or before the Effective Date, within ten
(10) days after service of notice of entry of the Confirmation Order,
the holder of an Administrative Claim must file with the Bankruptcy
Court and serve notice of such Administrative Claim upon counsel to the
Debtors, the Administrative Agent, and the Committee, provided,
however, that an Indenture Trustee seeking an Administrative Claim for
Indenture Trustees Fees must file with the Bankruptcy Court within four
(4) business days of entry of the Confirmation Order and serve notice
of Administrative Claim being for Indenture Trustees Fees upon Counsel
to the Debtors, the Administrative Agent and the Committee. Such notice
must include at a minimum (1) the name of the holder of the Claim, (2)
the amount of the Claim, and (3) the basis of the Claim. Failure to
file this notice timely and properly shall result in the Administrative
Claim being forever barred and discharged.
(c) Allowance of Administrative Claims. An Administrative
Claim with respect to which notice has been properly filed pursuant to
Section 2.2(a) herein shall become an Allowed Administrative Claim if
no objection is filed within thirty (30) days after the deadline for
filing and serving a notice of such Administrative Claim specified in
Section 2.2(a) herein, or such later date as may be approved by the
Bankruptcy Court on motion of a Debtor. An Administrative Claim for
Indenture Trustees Fees with respect to which notice has been properly
filed pursuant to Section 2.2(a) herein shall become an Allowed
Administrative Claim for Allowed Indenture Trustees Fees if no
objection is filed within four (4) business days after the deadline for
filing and serving a notice of such Administrative Claim for Indenture
Trustees Fees specified in Section 2.2(a) herein. If an objection is
filed within such thirty-day period (or any extension thereof), or four
business day period in the case of an Administrative Claim for
Indenture Trustees Fees, the Administrative Claim shall become an
Allowed Administrative Claim only to the extent allowed by Final Order
or as agreed to by a Debtor after consultation with the other
Proponents and the Administrative Agent. An Administrative Claim that
is a Fee Claim, and with respect to which a Fee Application has been
properly filed pursuant to Section 2.2(b) herein, shall become an
Allowed Administrative Claim only to the extent allowed by Final Order.
An Administrative Claim as to which no notice need be filed as set
forth in Section 2.2(a)(iii), (iv) or (v) shall be an Allowed
Administrative Claim on the Effective Date.
SECTION 3.3 CHANNELING INJUNCTION.
Pursuant to the TWC Settlement Agreement, the Confirmation Order shall
contain an injunction (the "Channeling Injunction") (1) providing that (A) all
Class 5/6 Channeled Actions shall be shall be channeled to and fully and
completely satisfied as a result of the TWC Contributed Distribution and the
other consideration provided by the TWC Entities under the TWC Settlement
Agreement; and (B) all Securities Holder Channeled Actions shall be channeled to
and fully and completely satisfied from the Securities Holder Channeling Fund;
and (ii) enjoining (except as may be required for recovery from officer/director
insurance policies or officer/director insurance carriers of a WCG Entity, and
without prejudice to the power or jurisdiction of any court, forum, or tribunal
to issue an order judgement, or determination of liability necessary to mandate
such coverage) the holders of Class 5/6 Channeled Actions and Securities Holder
Channeled Actions from:
(a) commencing, conducting, or continuing in any manner, directly
or indirectly, any suit, action or other proceeding of any
kind against a TWC Settlement Releasee or its direct or
indirect successor in interest (including, without limitation,
all suits, actions, and proceedings that are pending as of
the Effective Date, which must be withdrawn or dismissed with
prejudice) except as may be necessary to access the Securities
Holder Channeling Fund, provided, however, the foregoing shall
not affect or enjoin a Securities Holder (acting in such
capacity) from commencing, conducting, or continuing any suit,
action or other proceeding of any kind against a TWC Released
Party;
(b) enforcing, levying, attaching, collecting or otherwise
recovering by any manner or means whether directly or
indirectly any judgment, award, decree or order against a TWC
Settlement Releasee or its assets or property, or its direct
or indirect successor in interest, or any assets or property
of such transferee or successor, provided, however, the
foregoing shall not affect or enjoin a Securities Holder
(acting in such capacity) from enforcing, levying, attaching,
collecting or otherwise recovering any judgment, award, decree
or order against a TWC Released Party;
(c) creating, perfecting or otherwise enforcing in any manner,
directly or indirectly, any lien against a TWC Settlement
Releasee or its assets or property, or its direct or indirect
successors in interest, or any assets or property of such
transferee or successor, provided. however, the foregoing
shall not affect or enjoin a Securities Holder (acting in such
capacity) from creating, perfecting or otherwise enforcing
any lien against a TWC Released Party;
(d) asserting any set-off, right of subrogation or recoupment of
any kind, directly or indirectly against any obligation due a
TWC Settlement Releasee or its assets or property, or its
direct or indirect successors in interest, or any assets or
property of such transferee or successor, provided, however,
the foregoing shall not affect or enjoin a Securities Holder
(acting in such capacity) from asserting, any set-off, right
of subrogation or recoupment of any kind against any
obligation due a TWC Released Party; and
SECTION 4.2 CONDITIONS PRECEDENT TO THE OCCURRENCE OF THE EFFECTIVE DATE.
(b) all material statutory, regulatory or other consents,
authorizations, and approvals, including, without limitation (i) all
special temporary authority for the consents, authorizations, and/or
approvals required to be granted by the Federal Communications
Commission ("FCC") to effectuate the transfer of control of WCL's
licenses, without material modifications from their current form, to
New WCG; (ii) the SBC Authorization and (iii) consents and
authorizations under the WCL Credit Documents, the Restated Credit
Documents and each Plan Document, shall have been given or waived for
the transfers and transactions described in the Plan, including,
without limitation, the transfers of property and the payments
described in the Plan, as applicable;
(f) (intentionally omitted)
(g) (intentionally omitted)
SECTION 4.3 WAIVER OF CONDITIONS.
(b) Leucadia, in its sole discretion, may waive, in whole or
in part, the conditions precedent to the occurrence of The Effective
Date of the Plan described in Sections 4.2(b)(i).
(c) The Debtors, with the consent of the Proponents and the
Administrative Agent, may waive the conditions to the occurrence of the
Effective Date described in Section 4.2(e).
SECTION 4.4 EFFECTS OF CONFIRMATION.
(j) Exculpation.
(i) Except to the extent such would violate any applicable
professional disciplinary rules, including DR 6-102 of the Code of
Professional Conduct, from and after the Effective Date, neither the
Debtors, their Affiliates, the Administrative Agent, the Lenders, the
Committee, Leucadia, the TWC Entities, nor any of their respective
directors, officers, employees, members, attorneys, consultants,
advisors, and agents (acting in such capacity), shall have or incur any
liability to any Person for any act taken or omitted to be taken in
connection with the Debtors' restructuring, including the formulation,
preparation, dissemination, implementation, confirmation or approval of
the Restructuring Agreement, the TWC Plan Support Agreement, the TWC
Settlement Agreement, the Plan, the Plan Documents, the Disclosure
Statement, or any contract, instrument, release or other agreement or
document provided for or contemplated in connection with the
consummation of the transactions set forth in the Plan; provided,
however, that the foregoing provisions shall not affect the liability
of any Person that otherwise would result from any such act or omission
to the extent that act or omission is determined in a Final Order to
have constituted gross negligence, willful misconduct, breach of
fiduciary duty in bad faith or breach of fiduciary duty for personal
profit. Any of the foregoing parties in all respects shall be entitled
to rely upon the advice of counsel with respect to their duties and
responsibilities under the Plan.
(ii) From and after the Effective Date, the Indenture Trustees
and their agents, attorneys, and advisors shall be exculpated by all
Persons and entities, including, without limitation, all holders of
Senior Reset Note Claims and Senior Redeemable Notes Claims and other
parties in interest, from any and all claims, causes of action, and
other assertions of liability in connection with the Debtors'
restructuring arising out of the discharge of the powers and duties
conferred upon such Indenture Trustees by the Senior Reset Note
Indenture, the Senior Redeemable Notes indenture or the Plan or any
order of the Bankruptcy Court entered pursuant to or in furtherance of
the Plan, or applicable law, except for actions or omissions to act
arising out of the gross negligence or willful misconduct of the
Indenture Trustees. No holder of a Senior Reset Note Claim and Senior
Redeemable Notes Claim or other party in interest shall have or pursue
any claim or cause of action against the Indenture Trustees and their
agents, attorneys and advisors for making distributions in accordance
with this Plan or for implementing the provisions of this Plan. extent
for actions or omission to act of Indenture Trustees arising out of its
gross negligence, willful misconduct, or breach of a fiduciary duty
(other than from ordinary negligence) that results in personal profit
or harm to the Estates and their creditors.
(k) Release By Holders. As of the Effective Date, each holder of a
Senior Reset Note Claim and Senior Redeemable Notes Claim to the
fullest extent permissible under applicable law, as such law may be
extended or interpreted subsequent to the Effective Date, shall be
deemed to forever release, waive, and discharge all claims,
obligations, suits, judgments, damages, demands, debts, rights, causes
of action, and liabilities, whether liquidated or unliquidated fixed or
contingent, matured or unmatured, known or unknown, foreseen or
unforeseen, or then existing or thereafter arising in law, equity or
otherwise, that against the Indenture Trustees or their agents,
attorneys, and advisors, that are based in whole or in part on any act
taken or omitted to be taken in connection with the Debtors'
restructuring, except for actions or omissions to act of an Indenture
Trustee arising out of its gross negligence, willful misconduct, or
breach of a fiduciary duty (other than from ordinary negligence) that
results in personal profit or harm to the Estates and creditors.
This release, waiver and discharge will be in addition to the discharge
of claims and termination of interests provided herein and under the
Confirmation Order and the Bankruptcy Code (other than from ordinary
negligence.)
(m) Lender Releases. As of the Effective Date, their Proponents. The
Estates, every holder of a Claim or Equity Interest, and the TWC
Entities, forever release, waive and discharge the Released Lender
Parties (and the Released Lender Parties forever release, waive and
discharge the Proponents and the TWC Settlement Releases) from all
claims (as such term is defined in Section 101(5) of the Bankruptcy
Code), obligations, suits, judgments, damages, demands, debts, rights,
causes of action, liabilities, rights of contribution, and rights of
indemnification, whether liquidated or unliquidated, fixed or
contingent, matured or unmatured, known or unknown, foreseen or
unforeseen, then existing or thereafter arising, in law, equity, or
otherwise, that are based in whole or in part on any act, omission,
transaction, or other occurrence taking place on, or prior to, the
Effective Date in any way relating to the Debtors and their business
affairs (including, without limitation, any extensions of credit or
other financial services or accommodations made or not made to the
Debtors and affiliates prior to the Effective Date), the Chapter 11
Cases, the Plan, the WCG Credit Agreement, the WCL Credit Documents,
and the Restructuring Agreement and all documents and instruments
relating to any of the foregoing. The Confirmation Order shall
specifically provide for the foregoing releases and shall enjoin the
prosecution of any such released claim, causes of action, or liability.
SECTION 5.2 GOVERNANCE.
(a) SELECTION OF DIRECTORS AND OFFICERS OF NEW WCG
(i) Immediately following the Effective Date, the initial
board of directors of New WCG shall be composed of nine individuals,
consisting of the Chief Executive Officer of WCG, the following four
individuals selected by Leucadia (the "Leucadia Directors") Ian M.
Cumming, Joseph S. Steinberg, Jeffrey C. Keil and Alan J. Hirschfield
and the following four individuals to be selected by the Committee (the
"Committee Independent Directors") John Patrick Collins, William H.
Cunningham, Michael Diament, and Michael P. Ressner.
(ii) The Committee Independent Directors and two of the
Leucadia Directors must (A) be independent of New WCG within the
meaning of the rules of the New York Stock Exchange or, if New WCG is
listed or traded on another stock exchange, the stock exchange on which
New WCG's securities are listed or traded, and the applicable rules of
the SEC; (B) be independent of Leucadia; and, (C) not be an officer or
employee of New WCG or any of its affiliates.
(iii) An individual is not independent of Leucadia if he or
she (A) is not "independent" of Leucadia within the meaning of the
rules of the New York Stock Exchange or the SEC; (B) is an affiliate or
an officer, director, or employee of Leucadia; (C) is a beneficial
owner of more than 10% of the voting power of Leucadia or,(D) has any
relationship with Leucadia that would typically be required to be
disclosed in a Leucadia proxy statement;
After the initial Board is selected, the terms and manner of
selection of directors of New WCG shall be as provided in the New
Bylaws and the New Charter and in accordance with the terms of
the Stockholders Agreement.
Except as specifically set forth in the Stockholders
Agreement, the Stockholders Agreement to be entered into between New
WCG and Leucadia (the "Stockholders Agreement") shall not restrict or
limit the ability of Leucadia to vote its securities in its sole
discretion on all matters provided to the stockholders of New WCG for a
vote at a stockholders meeting or pursuant to any written consent,
except that, until the second anniversary of the Effective Date,
Leucadia and its affiliates have agreed to vote their securities for
the election of Committee Independent Directors as set forth in the
Stockholders Agreement and otherwise subject to the terms and
conditions thereof.
SECTION 5.4 EFFECTUATING DOCUMENTS.
On or before date of the commencement of the Confirmation
Hearing, the Debtors shall file with the Bankruptcy Court substantially final
forms of the agreements, instruments, and other documents that have been
identified herein as Plan Documents, which agreements, instruments, and
documents shall implement and be governed by the Plan. Entry of the Confirmation
Order shall authorize the officers of the Debtors and New WCG to execute, enter
into, and deliver all documents, instruments, and agreements, including but not
limited to the Plan Documents, and to take all actions necessary or appropriate
to implement the Plan including; but not limited to, filing with the Secretary
of State of the State of Nevada the New WCG Charter or any other document,
instrument, or agreement that may necessary or appropriate to ensure the valid
existence of New WCG on the Effective Date. To the extent the terms of any of
the Plan Documents conflict with the terms of the Plan, the Plan shall control.
SECTION 5.5 TRANSACTIONS ON THE EFFECTIVE DATE.
(a) the New Charter and New Bylaws shall be authorized,
approved and effective in all respects without further action under
applicable law, regulation, order, or rule including, without express
or implied limitation, any action by the stockholders or directors of
Old WCG or New WCG.
(b) each of the transactions that comprise the TWC Settlement
shall occur or be implemented and shall become binding and effective in
all respects, including, without limitation; (i) Leucadia shall make
the New Investment pursuant to the Leucadia Investment Agreement; (ii)
Leucadia shall purchase the TWC Assigned Claims pursuant to the
Leucadia Claims Purchase Agreement; (iii) Leucadia shall receive from
the Residual Trust the Leucadia Claims Distribution and from New WCG
the Leucadia Investment Distribution; (iv) TWC shall contribute the TWC
Contributed Distribution for the benefit of holders of Class 5/6
Channeled Actions, (v) WHBC shall sell the Building Purchase Assets to
WTC pursuant to the
Building Purchase Agreement; (vi) all of the Additional Settlement
Transactions shall be consummated; and (vii) all of the releases
contemplated by the TWC Settlement shall become binding and effective.
SECTION 7.1 SCOPE OF JURISDICTION.
(a) Resolve any cases, controversies, suits, or disputes that
may arise in connection with the consummation, interpretation, or
enforcement of the Plan, the TWC Settlement, the Declaration of Trust,
the liquidation of the Residual Assets, the distribution of Available
Proceeds, if any, the Securities Holder Channeling Fund the Securities
Holder Channeling Funds Distribution Procedures (except without
divesting the plenary jurisdiction of any court, forum or tribunal
with respect to the adjudication or determination of any Securities
Holder Channeled Action or action involving any claim by or on behalf
of a Securities Holder to recover from officer/director insurance
policies of a WCG entity or insurance carriers that cover officers and
directors of a WCG entity and the winding-up of Old WCG or any Person's
obligations incurred in connection therewith, or any other agreements
governing, instruments evidencing, or documents relating to any of the
foregoing, including the interpretation or enforcement of any rights,
remedies, or obligations under any of the foregoing;
SECTION 8.3(b) MODIFICATIONS TO THE PLAN.
(b) After the entry of the Confirmation Order, the Debtors
may, with the consent of each of the other Proponents, TWC, and the
Administrative Agent (which consent shall not be unreasonably withheld)
(i) amend or reconcile any inconsistency in the Plan in such manner as
may be necessary to carry out the purpose and intent of the Plan, in
accordance with the provisions of the Bankruptcy Code and Bankruptcy
Rules or (ii) extend any period of time or deadline provided in the
Plan in order to carry out the purpose and intent of the Plan.
Each Proponent of the Second Amended Joint Chapter 11 Plan of Williams
Communications Group, Inc. and CG Austria, Inc., dated August 12, 2002, hereby
agree and consent to the foregoing modifications.
WILLIAMS COMMUNICATIONS GROUP, INC.
/s/ Howard Janzen
By: Howard Janzen
Its: President
CG AUSTRIA,INC.
/s/ Howard Janzen
By: Howard Janzen
Its: President and CEO
THE OFFICIAL COMMITTEE OF UNSECURED
CREDITORS
By: Amalgamated Gadget, L.P.,
as Investment Manager
By: Scepter Holdings, Inc.,
General Partner
/s/ David R. Gillespie
By: David R. Gillespie, CFO
By: R2 INVESTMENTS, LPC
Its: Chairperson
LEUCADIA NATIONAL CORPORATION
/s/ Joseph A. Orlando
By: Joseph A. Orlando
Its: Vice President and CFO
THE WILLIAMS COMPANIES, INC.
/s/ Jack D. McCarthy
By: Jack D. McCarthy
Its: Senior Vice President
and Chief Financial Officer