EXHIBIT 2.1
UNITED STATES BANKRUPTCY COURT
FOR THE SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION
In re ) Case Nos. 01-56156, 01-56158,
) 01-56160
)
COOKER RESTAURANT CORPORATION, et al.,(1) ) Jointly Administered Under
) CASE NO. 01-56156
Debtors and Debtors in Possession ) Chapter 11
Judge: Donald E. Calhoun, Jr.
DEBTORS' FIRST AMENDED PLAN OF REORGANIZATION
DATED JULY 3, 2002 (AS REVISED)
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(1) CGR Management Corporation, a Florida corporation and Southern Cooker
Limited Partnership, an Ohio partnership, both of which are affiliates of the
Cooker Restaurant Corporation are also debtors in possession.
UNITED STATES BANKRUPTCY COURT
FOR THE SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION
In re ) Case Nos. 01-56156, 01-56158,
) 01-56160
)
COOKER RESTAURANT CORPORATION, et al.,(2) ) Jointly Administered Under
) CASE NO. 01-56156
)
Debtors and Debtors in Possession ) Chapter 11
Judge: Donald E. Calhoun, Jr.
DEBTORS' FIRST AMENDED PLAN OF REORGANIZATION
DATED JULY 3, 2002 (AS REVISED)
I.
INTRODUCTION
Cooker Restaurant Corporation ("CRC"), CGR Management Corporation
("CGR"), and Southern Cooker Limited Partnership ("SCLP") (the "Debtors") are
the debtors and debtors-in-possession in Chapter 11 bankruptcy cases. On May
25, 2001 (the "Petition Date"), CRC, SCLP, and CGR commenced their respective
bankruptcy cases by filing voluntary bankruptcy petitions under Chapter 11 of
Title 11 of the United States Code, 11 U.S.C. ss. 101 et seq, (the "Bankruptcy
Code" or "Code"). This document is the First Amended Plan of Reorganization
dated July 3, 2002 (as revised) (the "Plan") proposed by the Debtors ("Plan
Proponent"). Sent to you in the same envelope, as this document is the First
Amended Disclosure Statement dated July 3, 2002
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(2) CGR Management Corporation, a Florida corporation and Southern Cooker
Limited Partnership, an Ohio partnership, both of which are affiliates of the
Cooker Restaurant Corporation are also debtors in possession.
(as revised) which has been approved by the Court, and which is provided to
help you understand the Plan.(3)
The Plan is a reorganization plan. In other words, the Debtors seek to
restructure their secured, priority and unsecured debt and continue operating
their businesses as a going concern. As discussed in detail below, the Debtors
believe that a reorganization - as opposed to a liquidation - will maximize
value for all creditor and equity constituencies. The Debtors intend to fund
payments required under the Plan from cash generated by operations, by raising
additional equity, by disposing of certain of the Debtors' non-core assets, and
from an anticipated Tax Refund. Moreover, throughout these bankruptcy cases,
the Debtors have taken a variety of steps designed to increase profitability
including increasing sales, reducing expenses, disposing of excess real
property and eliminating under performing restaurants, all of which will assist
the Debtors in complying with their obligations under the Plan.
The Effective Date of the proposed Plan is the later of: (1) the first
(1st) day of the first month which begins at least eleven (11) days following
the Confirmation Date; or (2) the first day of the first month after such date
under clause (1) on which there is not in force any stay or injunction against
the enforcement of the Plan or the Confirmation Order, provided that the
Effective Date will not occur until all conditions to Effective Date set forth
in Section V have been satisfied. The Debtors expect that the Effective Date
will be on or about September 1, 2002.
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(3) The Plan and the Disclosure Statement contain a number of
capitalized terms. An appendix containing the definitions for these capitalized
terms (the "Definitions") are contained in EXHIBIT 1 to the Plan.
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II.
CLASSIFICATION AND TREATMENT OF CLAIMS AND INTERESTS
----------------------------------------------------
A. WHAT CREDITORS AND INTEREST HOLDERS WILL RECEIVE UNDER THE PLAN
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The Plan classifies Claims and Interests in various classes according
to their right to priority. The Plan states whether each class of Claims or
Interests is impaired or unimpaired. The Plan provides the treatment each class
will receive.
B. SUBSTANTIVE CONSOLIDATION
-------------------------
The Plan provides for the Debtors' Assets and liabilities to be
consolidated. Substantive consolidation is a process by which the assets and
liabilities of different debtor entities are consolidated and the various
debtor entities are treated as a single entity for purposes of the Plan. The
consolidated assets create a single fund from which all of the claims against
the consolidated debtors are satisfied. Creditors of single entities before
consolidation become creditors of the consolidated debtors, sharing in the
assets of the consolidated estate. Substantive consolidation also eliminates
intercompany claims of the debtor companies and duplicative claims against the
related debtors. In addition, creditors of the consolidated entities are
combined for purposes of voting on a plan of reorganization for the
consolidated entity.
If the Bankruptcy Court approves the Plan and the Debtors' Estates are
substantively consolidated (1) each of the Debtors and its respective estate
shall be substantively consolidated for purposes of classification and
distribution under the Plan, pursuant to section 1123(a)(5)(C) of the
Bankruptcy Code, and (2) all Allowed Claims in Classes 3(a)-(c) shall be
treated on a pari
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passu basis. As a result of such consolidation, the common stock issued by the
Debtors shall be deemed canceled and surrendered and all claims of any of the
Debtors against another Debtor shall be deemed canceled.
The Debtors believe the following facts support their consolidation
and the consolidation of their respective estates: (i) the Debtors' general
ledger system did not segregate accounts by legal entity until the books are
reconciled at the end of each calendar year, and as a result, the Debtors did
not maintain on-going, separate and distinct books, financial records, and
accounts for each corporation; (ii) the assets and funds of the Debtors were
commingled; (iii) CRC regularly paid the unsecured debtors of the other Debtors
without contractual obligation to do so; (iv) CRC entered into executory
contracts and leases from which the other Debtors operated; (v) the Debtors
shared many of the same officers and board of director members; (vi) management
information systems and reporting methods of the Debtors generally did not
distinguish between legal entities and treated CRC and the other Debtors as one
entity; and (vii) certain creditors of the Debtors have looked to CRC for
payment of the obligations of the Debtors. The preceding list of facts in
support of consolidation of the Debtors is not intended by the Debtors to be
exclusive.
The Debtors can provide no assurances, however, that the Bankruptcy
Court will approve the consolidation of the Debtors, whether or not the Plan is
accepted by holders of Claims entitled to vote on the Plan. In the event that
the Bankruptcy Court does not approve consolidation, the Debtors will comply
with any order requiring separation of the Debtor entities under the Plan.
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C. UNCLASSIFIED CLAIMS
-------------------
As required by the Bankruptcy Code, certain types of Claims are not
placed into voting classes; instead they are unclassified. They are not
considered impaired and they do not vote on the Plan because they are
automatically entitled to specific treatment provided for them in the
Bankruptcy Code. As such, the Debtors have not placed the following Claims in a
class.
1. Administrative Expenses
-----------------------
Administrative expenses are Claims for costs or expenses of
administering the Debtors' Cases, which are allowed under Bankruptcy Code
section 507(a)(1) (the "Administrative Claims"). The Bankruptcy Code requires
that all Administrative Claims be paid on the Effective Date of the Plan,
unless a particular claimant agrees to a different treatment. The following
chart lists the Debtors' section 507(a)(1) Administrative Claims and their
treatment under the Plan.
A. ADMINISTRATIVE CLAIMS OF NON-PROFESSIONALS
Other than those listed in Table 1 below, the Debtors do not believe
any amounts will be owed to parties who provide goods and services after the
Petition Date (other than Professionals) except for current obligations
(including Post-Petition, pre-Effective Date real and personal property taxes),
which will be paid in the ordinary course of business.
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TABLE 1: SUMMARY OF ADMINISTRATIVE CLAIMS OF NON-PROFESSIONALS
ESTIMATE OF
ADMINISTRATIVE RELATIONSHIP TO AMOUNT OWING AS
CREDITOR DEBTORS OF 9/1/2002 TREATMENT
Winthrop Resources Equipment Lessor $25,560.00 Winthrop has an allowed Administrative Claim against the Debtors'
Corporation Estates in the original amount of $250,000. As of May 1, the
Debtors have paid all but $72,225 of the amounts and are making
monthly payments of $15,555.00. To the extent that any amounts
are outstanding, such amounts will be paid in full on the
Effective Date.
Hudson United Bank Equipment Lessor $0.00 The Debtors expect that all amounts owing to Hudson United Bank
($30,000.00) will be paid in full prior to the Effective Date.
To the extent that any amounts are outstanding, such amounts
will be paid in full on the Effective Date.
Mercury Capital Post-petition $2,906,659.50 The full amount of this claim will be paid on the Effective Date.
Corporation secured lender
Trustee Fees $10,500.00 Debtors' 2d quarterly payment of $10,500.00 in the year 2002 will
be paid in August 2002. The Debtors shall continue to pay
United States Trustee's fees after the Effective Date as provided
by applicable law
Indenture Trustee Fee Indenture Trustee $125,000.00 The Debtors shall pay the Indenture Trustee the lesser of:(a) the
under the actual amount of fees owing under the Debenture; and (b)
Debentures $125,000.00 (the "Indenture Trustee Fee"). The full amount of
this claim will be paid on the Effective Date.
Administrative Real Taxing authorities $0.00 All accrued Administrative Real Property Taxes for the period
Property Taxes 5/25/01-12/31/01 will have been paid in full in the ordinary
course of business by the Effective Date. Administrative Real
Property Taxes for the period 1/1/02-9/1/02 are estimated
to be $742,000. These taxes are not yet due and payable and
will be paid in the ordinary course of business when due and
payable under applicable state law.
Administrative Taxing Authorities $0.00 All accrued Administrative Personal Property Taxes for the period
Personal Property 5/25/01-12/31/01 will have been paid in full in the ordinary
Taxes course of business by the Effective Date. Administrative Personal
Property Taxes for the period 1/1/02-9/1/02 are estimated
to be $110,000. These taxes are not yet due and payable and
will be paid in the ordinary course of business when due and
payable under applicable state law.
TOTALS $3,067,719.50
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B. ADMINISTRATIVE CLAIMS OF PROFESSIONALS
With respect to Professionals, the Debtors have been paying
Professionals on a current basis for eighty percent (80%) of their monthly fees
and one hundred percent (100%) of their monthly expenses. Accordingly, the
Debtors do not believe that there will be any significant amounts owing to
Professionals on the Effective Date. As of September 1, 2002, the Debtors
expect that: (a) 80% of all fees and 100% of all expenses owing to
Professionals will have been paid in full through July 31, 2002; and (b) the
Debtors will have deposited the 20% Holdback owing for all applicable periods
(2/1/02-7/31/02) into the account established by the Knudsen Order for the
benefit of Professionals (the "Professionals Reserve"). Accordingly, the
Debtors estimate that the only amounts outstanding to Professionals will be
100% of the fees and 100% of the expenses owing for August 2002. Those amounts
are estimated in Table 2 below. In addition, the Debtors estimate that (as of
September 1, 2002), Professionals will be holding approximately $200,000.00 in
retainers, which have yet to be applied.
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TABLE 2: SUMMARY OF ADMINISTRATIVE CLAIMS OF PROFESSIONALS
AMOUNT ESTIMATED
ADMINISTRATIVE RELATIONSHIP TO HOLDBACK
CREDITOR DEBTORS (2/1/02-9/1/02) TREATMENT
Pachulski, Stang, Ziehl, General Bankruptcy $100,000.00 Paid in full on the later of (1) the Effective Date or
Young & Jones P.C. Counsel to Debtors (2) the date upon which the Claim is Allowed pursuant to
a Final Order.
Development Specialists, Crisis Management $60,000.00 Paid in full on the later of (1) the Effective Date or
Inc. and Turn-Around (2) the date upon which the Claim is Allowed
Consultants to pursuant to a Final Order.
Debtors
Boult Cummings Special Counsel to $16,000.00 Paid in full on the later of (1) the Effective Date or
the Debtors (2) the date upon which the Claim is Allowed pursuant to
a Final Order.
Deloitte & Touche Tax and Audit $20,000.00 Paid in full on the later of (1) the Effective Date or
Accountants to (2) the date upon which the Claim is Allowed
Debtors pursuant to a Final Order.
Vorys, Sater, Seymour & Local Bankruptcy $24,000.00 Paid in full on the later of (1) the Effective Date or
Pease Counsel to Debtors (2) the date upon which the Claim is Allowed pursuant to
a Final Order.
James F. Hadley Co., LPA Special Real Estate $24,400.00 Paid in full on the later of (1) the Effective Date or
Counsel to Debtors (2) the date upon which the Claim is Allowed pursuant to
a Final Order.
KPMG LLP Financial Advisors $12,000.00 Paid in full on the later of (1) the Effective Date or
and Accountants to (2) the date upon which the Claim is Allowed pursuant
the Committee to a Final Order.
Schottenstein, Zox & Dunn General Bankruptcy $20,000.00 Paid in full on the later of (1) the Effective Date or
Counsel to the (2) the date upon which the Claim is Allowed pursuant
Committee to a Final Order.
Rhiel & Terlecky Co. Special Counsel to $8,000.00 Paid in full on the later of (1) the Effective Date or
the Committee (2) the date upon which the Claim is Allowed pursuant to
a Final Order.
TOTALS $284,396.50
The Court must rule on all professional fees incurred after the
Petition Date and any Administrative Claims asserted by private parties not
paid in the ordinary course of business before such Claims will be owed. Only
the amount of Administrative Claims allowed by the
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Court will be owed and required to be paid under this Plan. The Professionals
listed above must file and serve a properly noticed fee application and the
Court must rule on the applications.
C. ADMINISTRATIVE REAL AND PERSONAL PROPERTY TAX CLAIMS
Any real property tax Claims arising for the period from the Petition
Date to the Effective Date (the "Administrative Real Property Taxes") will be
paid by the Debtors in the ordinary course of business as and when such taxes
become due, provided, however, that the Bank Group shall reimburse the Debtors
in connection with certain real property taxes paid by the Debtors after April
8, 2002 with respect to Tranche B properties (either through a deduction upon
the sale of such property or by repayment in connection with another
disposition of the property) all as more specifically provided for herein.
Any personal property tax Claims arising for the period from the
Petition Date to the Effective Date (the "Administrative Personal Property
Taxes") will be paid by the Debtors in the ordinary course of business as and
when such taxes become due. No deductions shall be made from the proceeds to be
distributed to the Bank Group or CIT under the terms of the Plan for any
Administrative Personal Property Taxes, which Claims shall be paid from
available funds of Reorganized CRC.
D. ADMINISTRATIVE BAR DATE FOR FILING OF ADMINISTRATIVE
CLAIMS
(1) BAR DATE FOR ADMINISTRATIVE TAX CLAIMS
--------------------------------------
All requests for payment of Administrative Tax Claims and for which no
earlier bar date has been or is established outside of this Plan, such as may
be established by requesting an
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expedited audit under Bankruptcy Code section 505, must be filed on or before
the later of the forty-fifth (45th) day following entry of the Confirmation
Order or, if a tax return is required to be filed with respect to such
Administrative Tax Claim, one hundred twenty (120) days following the filing of
the applicable tax return.
(2) BAR DATES FOR ALL OTHER ADMINISTRATIVE
CLAIMS
Requests for payment of Administrative Claims incurred after May 25,
2001 must be filed and served on the Debtors' counsel and the Office of the
United States Trustee no later than the thirtieth (30th) day following the
entry of the Confirmation Order. Excluded from this requirement are
Administrative Tax Claims, Professional Claims (defined below), statutory fees
and Administrative Claims described in Table 1 and Table 2 above. Any objection
to any other Administrative Claim must be filed within 120 days from the date
such Administrative Claim is filed.
Professionals or other entities requesting compensation or
reimbursement of expenses pursuant to Bankruptcy Code sections 327, 328, 330,
331, 503(b) and 1103 for services rendered prior to the Effective Date
("Professional Claims") must file and serve on all parties entitled to notice
thereof, an application for final allowance of compensation and reimbursement
of expenses no later than the sixtieth (60th) day following entry of the
Confirmation Order. All such requests for payment of Administrative Claims and
applications for final allowance of compensation and reimbursement of expenses
will be subject to the authorization and approval of the Bankruptcy Court.
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Holders of Administrative Claims (including, without limitation,
Professional Claims) that do not file such requests by the applicable bar date
will be forever barred from asserting such Claims against the Debtors, the
Debtors' Estates, Reorganized CRC or its property. Any objection to
Administrative Claims of Professionals shall be filed on or before the date
specified in the application for final compensation.
2. Priority Tax Claims
Priority Tax Claims are certain unsecured income, employment and other
taxes described by Bankruptcy Code section 507(a)(8). The Bankruptcy Code
requires that each holder of such a section 507(a)(8) Priority Tax Claim
receive the present value of such Claim in deferred cash payments, over a
period not exceeding six years from the date of the assessment of such tax.
Attached to the Disclosure Statement as EXHIBIT G is a list of all Priority Tax
Claims filed against the estates.(4)
TABLE 3: SUMMARY OF PRIORITY TAX CLAIMS
CLAIMANT TYPE OF TAX CLAIM AMOUNT PROPOSED TREATMENT
CLAIM
All Priority Tax Various See Approximately Each Claimant identified on EXHIBIT G shall receive
Claims Identified on attached $956,000.00 deferred payments on account of its Allowed Claim over
EXHIBIT G EXHIBIT G a period of six (6) years from the Effective Date.
Each Claimant shall receive monthly installments of
principal and interest on the unpaid portion thereof at
5.5% per annum. The first installment shall be due on
first day of the first month following the thirtieth
(30th) day after the Effective Date with each installment
due each one month thereafter. The Debtors may, without
penalty, prepay the entire amount of a Priority Tax Claim
at any time.
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(4) The Debtors reserve their rights to object to the amount, validity
and/or priority of any and all Priority Tax Claims.
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D. CLASSIFIED CLAIMS AND INTERESTS
1. Summary of Classification under the Debtors' Plan
-------------------------------------------------
As is further described in this Subsection (D), the Debtors have
classified Claims and Interests under the Plan as follows:
TABLE 4: SUMMARY OF CLASSIFICATION OF CLAIMS AND INTERESTS
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CLASS INTEREST IMPAIRED
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1(a) Secured Claim of the Bank Group consisting of: Yes
- Bank Group Allowed Tranche A Claim
- Bank Group Allowed Tranche B Claim
1(b) CIT Secured Claim consisting of: Yes
- CIT Allowed Tranche A Claim
- CIT Allowed Tranche B Claim
1(c) Secured Real Property Tax Claims Yes
1(d) PACA Claims No
1(e) Reclamation Claims No
1(f) Secured Personal Property Tax Claims Yes
1(g) Subordinate Real Property Claims Yes
2 Priority Non-Tax Claims No
3(a) General Unsecured Claims, including but not limited to the Yes
CIT General Unsecured Claim
3(b) Bondholder General Unsecured Claims Yes
3(c) Bank Group General Unsecured Claim Yes
4 Interests Yes
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2. Classes of Secured Claims
-------------------------
Secured Claims are Claims secured by liens on property of the Estates.
The following chart lists all classes containing Debtors' pre-petition Secured
Claims and their treatment under this Plan:
3. Class 1(a): Secured Claim of the Bank Group:
--------------------------------------------
Class 1(a) consists of the Allowed Secured Claim of the Bank Group.
Class 1(a) is impaired. The Allowed Secured Claim of the Bank Group shall be in
the amount of $60,750,000.00 and shall be treated as follows:
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A. GENERAL.
--------
The Allowed Secured Claim of the Bank Group consists of the following
two (2) components: (a) an Allowed Secured Claim secured by restaurants the
Debtors intend to operate after the Effective Date (the "Bank Group Allowed
Tranche A Claim"); (b) an Allowed Secured Claim secured by certain properties
the Debtors are currently marketing for sale (the "Bank Group Allowed Tranche B
Claim"). In addition, the Bank Group will have a contingent Allowed Unsecured
Deficiency Claim (which shall be separately classified in Class 3(c) which is
equal to the lesser of (i) $3,000.000.00; and (ii) the unsecured deficiency
Claim, if any, arising with respect to the Bank Group Allowed Tranche B Claim
(the "Bank Group Allowed Unsecured Deficiency Claim").
B. THE BANK GROUP ALLOWED TRANCHE A CLAIM.
---------------------------------------
(1) AMOUNT.
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The Bank Group Allowed Tranche A Claim shall be in the amount of
$31,500,000, which sum includes $1,000,000 of the net sales proceeds retained
by the Debtors in connection with the Tranche B Owned Properties.
(2) MATURITY DATE, INTEREST RATE AND
AMORTIZATION.
The Bank Group Allowed Tranche A Claim shall mature on September 1,
2006 and shall accrue interest, commencing on September 1, 2002, at the rate of
Prime plus three (3) percent, adjusted annually. The Bank Group Allowed Tranche
A Claim shall be amortized over a fourteen (14) year period commencing on
September 1, 2003.
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(3) PAYMENTS.
Commencing on the first (1st) day of the first (1st) month following
the Effective Date, the Debtors shall make interest only payments to the Bank
Group, provided, however, that if the Effective Date occurs later than
September 1, 2002, then on the first (1st) month following the Effective Date,
the Debtors shall make a payment to the Bank Group equal to the amount of
interest (calculated as of September 1, 2002) which has accrued on the Allowed
Bank Group Tranche A Claim since September 1, 2002. On the anniversary of the
Effective Date, the outstanding principal owing under the Bank Group Allowed
Tranche A Claim will be amortized over a 14 year period, based upon the then
existing interest rate. The amortization schedule will be recalculated each
successive anniversary of the Effective Date, based upon the then existing
interest rate and using an amortization term which is one year less than the
amortization term used to compute the prior year's amortization schedule.
(4) SECURITY.
The Bank Group will retain a first priority deed of trust encumbering
the Tranche A Owned Properties (and will be granted a first priority deed of
trust on any Tranche A Owned Property in which the Bank Group does not
presently have a first priority lien), subject only to real property taxes and
senior liens of record as of the Petition Date. The Debtors shall use
reasonable efforts to extinguish all liens junior to the Allowed Bank Group
Tranche A Claim through the Plan but shall not represent or warrant that the
Tranche A Owned Properties are free and clear of such liens, if any.
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The Debtors will grant the Bank Group a second priority security
interest encumbering CIT Tranche A FF&E), a first priority lien on the Tranche
A Leased Properties; and a security interest in the Debtors' intellectual
property, all pursuant to agreements acceptable to the Debtors and the Bank
Group.
Provided the Debtors are not in default in connection with its
obligations to the Bank Group under the Plan, the Bank Group shall be obligated
to release its liens encumbering the Tranche A Owned Properties, the Tranche A
Leased Properties, and the Tranche A Personal Property for a payment equal to
the greater of (a) the Net Proceeds of the sale of a Tranche A Owned Property
or a Tranche A Leased Property; or (b) the Tranche A Release Prices, provided,
however, that the Bank Group may agree to reduced release prices as it deems
appropriate. The Net Proceeds of the sale of a Tranche A Owned Property or a
Tranche A Leased Property (the "Tranche A Net Proceeds") shall be applied to
the outstanding principal amount due at maturity under the Allowed Tranche A
Claim.
(5) REAL PROPERTY TAXES.
Delinquent pre-petition real property taxes owing with respect to the
Tranche A Owned Properties as of May 25, 2001 (but excluding the Administrative
Real Property Taxes which shall be paid as provided for in the section
entitled, "ADMINISTRATIVE REAL AND PERSONAL PROPERTY TAX CLAIMS" above), shall
be restructured under the Plan on the terms outlined for the treatment of Class
1(d) Secured Real Property Tax Claims. Commencing on the first (1st) day of the
first (1st) month following the Effective Date, to the extent not paid in
advance, the Debtors shall
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deposit into an Escrow Account held by the Bank Group a sum equal to 1/12 of
the annual real property owed in connection with the Tranche A Owned Properties
according to the last tax bill. When said tax is due, the Debtors shall be
entitled to withdraw the funds from the impound account to pay for the
post-Effective Date real property taxes.
When the Debtors make a payment after the Effective Date (including
upon a sale of any Tranche A Real Property) on account of unpaid real property
taxes with respect to a Tranche A Property (a "Tranche A Real Property Tax
Payment"), Reorganized CRC shall (a) withdraw from the Escrow Account that
portion of the Tranche A Real Property Tax Payment which relates to real
property taxes accruing after the Effective Date; and (b) pay from available
funds that portion of the Tranche A Real Property Tax Payment which relates to
Administrative Real Property Taxes and Class 1(c) Secured Real Property Tax
Claims.
(6) INSURANCE.
Commencing on the first (1st) day of the first (1st) month following
the Effective Date, the Debtors shall, to the extent not paid in advance,
deposit into an Escrow Account held by the Bank Group a sum equal to 1/12 of
the annual fire, casualty and general liability insurance owed in connection
with the Tranche A Owned Properties according to the most recent annual
insurance statements.
C. THE TRANCHE B CLAIM.
--------------------
(1) AMOUNT.
The Bank Group Allowed Tranche B Claim shall be in the amount of
$29,250,000.
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(2) INTEREST.
The Bank Group Allowed Tranche B Claim will not bear interest, except
as provided below.
(3) NON-RECOURSE.
The Bank Group Allowed Tranche B Claim is non recourse to the Debtors.
(4) PAYMENTS.
(A) PAYMENTS ALREADY MADE ON ACCOUNT
OF TRANCHE B CLAIM.
As of June 25, 2002, the Bank Group has received payments totaling
$3,921,351.74 representing the proceeds of the sales of Fairfax, Virginia;
Augusta, Georgia and Kennesaw, Georgia (except for $250,000 retained from the
sale of the Kennesaw, Georgia property and being held in a segregated
accounting pending resolution of disputes with CIT (the "Kennesaw CIT Reserve")
and $298,258.00 representing cash collateral generated from leased property.
Accordingly, as of May 30, 2002, the amount of Tranche B Claim shall be equal
to $25,030,390.00.
(B) PRE-EFFECTIVE DATE PAYMENTS ON
ACCOUNT OF TRANCHE B CLAIM.
Upon entry of a Final Order approving a Stipulation between the
Debtors and the Bank Group which provides for the Bank Group's support of the
Plan pursuant to the terms herein, the Debtors shall pay to the Bank Group
$6,714,261.01 (plus interest which actually accrued on such
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amounts) which represents (A) the net proceeds of Melbourne, net of $55,000 to
be paid to CIT ($1,442,970.92); (B) the net proceeds of Boynton Beach, net of
$55,000 to be paid to CIT ($1,807,359.59); (C) the net proceeds of Tallahassee,
net of $55,000 to be paid to CIT ($1,246,714.77), (D) the net proceeds of
Gainesville, net of $55,000 to be paid to CIT ($1,149,051.27); (E) the net
proceeds of Lexington, net of $55,000 to be paid to CIT ($818,164.46); and (F)
the Kennesaw CIT Reserve ($250,000.00); minus $1,000,000 which shall be held by
Bank Group's counsel in its trust account and which shall be paid to the
Debtors on the Effective Date, (which $1,000,000 has been included in the Bank
Group Allowed Tranche A Claim) plus all future Net Proceeds (less payments to
CIT) from the sale of any collateral of the Bank Group.
After the payments specifically described in subparagraphs (A), (B)
(C), (D), (E) and (F) above, the balance due under Tranche B will be
$19,316,128.99 as of the date of such payments (the "Tranche B Adjusted
Principal Balance"). The Tranche B Adjusted Principal Balance shall be reduced
by any additional payments made to the Bank Group prior to the Effective Date
from the sale of collateral of the Bank Group or collection of rental proceeds
on the Gwinett, Georgia property. The Bank Group shall receive the Net Proceeds
from the sale of the Tranche B Owned Properties until the Tranche B Adjusted
Principal Balance has been paid in full. Any Tranche B Net Proceeds generated
from the sale of the Tranche B Owned Properties in excess of the Tranche B
Adjusted Principal Balance shall be split 50% to the Bank Group, as interest
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(deductible to the Debtors), and 50% to the Debtors for use by the Debtors as
they deem appropriate.
(C) TRANCHE B NET PROCEEDS.
Tranche B Net Proceeds shall mean the gross proceeds with respect to a
sale net of (a) $55,000 for each Tranche B Owned Property at which CIT has a
perfected security interest (all properties listed on Exhibit 3 to the Plan;
(b) reasonable, customary and necessary costs of sale, including, but not
limited to counsel fees and costs and other costs of effecting sales (for
closings after the Effective Date); (c) commissions; and (d) unpaid real
property taxes. For the avoidance of doubt, the Debtors shall not be entitled
to deduct property preservation and maintenance costs relating to the Tranche B
Owned Properties, rather, such operating expenses shall be paid by the Debtors
from existing cash flow. Notwithstanding the foregoing, if, after April 8,
2002, the Debtors pay any real property taxes on any Tranche B Owned Property
that accrued prior to the closing of the sale of such Tranche B Owned Property
(the "Pre Closing Real Property Tax Payments") then the Debtors shall also be
entitled to deduct from the sale proceeds of such Tranche B Owned Property (or
shall be reimbursed by the Bank Group for said Pre-Closing Real Property Tax
Payments if the Tranche B Owned Property is transferred to the Bank Group by
any means, including but not limited to foreclosure, a deed in lieu of
foreclosure or a quitclaim deed) an amount equal to the Pre Closing Real
Property Tax Payments.
19
(5) SECURITY.
The Bank Group will retain a first priority deed of trust encumbering
the Tranche B Owned Properties, subject only to real property taxes and liens
of record as of the Petition Date. Provided the Debtors are not in default in
connection with its obligations to the Bank Group under the Plan, the Bank
Group shall be obligated to release its liens encumbering the Tranche B Owned
Properties for a payment equal to the greater of (a) the Net Proceeds of the
sale of a Tranche B Owned Property or (b) the Tranche B Release Prices,
provided, however, that the Bank Group may agree to reduced release prices as
it deems appropriate. If the Debtors propose a sale to the Bank Group that will
yield Net Proceeds less than the applicable Tranche B Release Price and the
Bank Group does not accept the sale then the Debtors may provide the Bank Group
with a deed in lieu of foreclosure or a quitclaim deed to a Person designated
by the Bank Group with respect to the Tranche B Owned Property and receive a
credit against the amount of the Allowed Tranche B Claim in an amount equal to
the Net Proceeds the Debtors would have received pursuant to the sale.
(6) DEED IN LIEU OPTION
At the Bank Group's written request, the Debtors shall execute a deed
in lieu of foreclosure or quitclaim deed (without representation or warranty of
any kind) in favor of the Bank Group or its designee for any of the Tranche B
Owned Properties. For each deed in lieu of foreclosure or quitclaim deed
executed by the Debtors, the Debtors shall receive a credit against the Tranche
B Adjusted Balance in an amount equal to the release price agreed to for such
20
Tranche B Owned Property. Notwithstanding the foregoing, the Bank Group shall
not be entitled to a deed in lieu of foreclosure or quitclaim deed after the
receipt by Debtors of a bona fide offer that would yield Net Proceeds to the
Bank Group in excess of the applicable release price for the Tranche B Owned
Property. Any Tranche B Owned Real Property that has not been sold by June 30,
2003 may also be foreclosed by the Bank Group. For purposes of computing the
amount credited to the Allowed Tranche B Claim, for any deed in lieu or
quitclaim deed or foreclosure from and after July 1, 2003, the credit against
the amount of the Allowed Tranche B Adjusted Balance will be 70% of the Tranche
B Release Price for that particular Tranche B Owned Property.
D. THE BANK GROUP GENERAL UNSECURED CLAIM.
---------------------------------------
If, after the sale, quitclaim or foreclosure of all of the Tranche B
Owned Properties, the Tranche B Adjusted Principal Balance has not been paid in
full, the Bank Group shall be entitled to an Unsecured Deficiency Claim in the
amount of the lesser of (a) the amount of the Tranche B Adjusted Principal
Balance; or (b) $3,000,000 (the "Bank Group General Unsecured Claim"). The Bank
Group General Unsecured Claim shall be classified in Class 3(c) and (except
with respect to the Class 3 Warrants, which shall not be issued to the Bank
Group), shall receive the same treatment as the General Unsecured Claims in
Class 3(a).
The Debtors shall reserve from any Cash payments to be made to holders
of Class 3(a) (General Unsecured Claims) and Class 3(b) (Bondholder General
Unsecured Claims) an amount equal to the Bank Group's Pro Rata share of such
cash assuming that the Bank Group General Unsecured Claim will be equal to
$3,000,000. The Bank Group shall not be entitled to receive any warrants in
connection with the Class 3(c) Claims ((Bank Group General Unsecured Claim)
21
notwithstanding that warrants are provided to the holders of Class 3(a)
(General Unsecured Claims) and Class 3(b) (Bondholder General Unsecured
Claims).
E. WARRANTS.
---------
(1) AMOUNT.
On the Effective Date, the Bank Group will receive warrants to
purchase 615,835 shares of common stock of Reorganized CRC (which equals 10% of
all of the shares to be issued or reserved for issuance under the Plan (other
than shares reserved for the Employee Incentive Stock Plan). The warrants will
contain anti-dilution protection (subject to dilution in connection with the
issuance of an additional 5% of Reorganized CRC in New Common Stock to
management of Reorganized CRC pursuant to the Employee Incentive Stock Plan)
and tag along - drag along rights (the "Bank Group Warrants").
(2) EXERCISE AND STRIKE PRICE.
The Bank Group may not exercise any of the Bank Group Warrants prior
to July 1, 2003, provided, however that the July 1, 2003 date shall be extended
for the duration of any redemption offer made by the Debtors prior to July 1,
2003, which period shall not exceed ninety (90) days beyond the date of the
offer. Thereafter, subject to the redemption of the Bank Group Warrants
provided in Subsection 3 below, the Bank Group may exercise the Bank Group
Warrants as follows: (a) for $1.50 per share for the period July 1, 2003
through the date which is the second anniversary of the Effective Date of the
Plan; and (b) $1.75 per share for the period which is the date following the
second anniversary of the Effective Date of the Plan until the date which is
the
22
seventh anniversary of the Effective Date of the Plan. All unexercised Bank
Group Warrants shall expire on the date, which is the seventh anniversary of
the Effective Date of the Plan.
(3) REDEMPTION OF WARRANTS.
The Debtors shall be entitled to redeem the Bank Group Warrants as
follows:
The Debtors shall be entitled to redeem 75% of the Bank Group Warrants
for an aggregate payment of $1 on or after the date on which the Tranche B
Adjusted Principal Balance is equal to $4,250,000 or less, provided, however
that such right shall not exist if the Tranche B Adjusted Principal Balance is
not reduced to $4,250,000 on or before March 1, 2003.
The Debtors shall be entitled to redeem 85% of the Bank Group Warrants
for an aggregate payment of $1 on or after the date on which the Tranche B
Adjusted Principal Balance has been paid off in full, provided, however, that
such right shall not exist if the Tranche B Adjusted Principal Balance is not
paid in full on or before June 30, 2003.
On the date which is on or after the fourth anniversary of the
Effective Date but prior to the fifth anniversary of the Effective Date, the
Debtors shall be entitled to redeem any outstanding Bank Group Warrants for
$500,000 multiplied by a fraction, the numerator which is equal to the number
of original Bank Group Warrants still held by the Bank Group and the
denominator which is the number of Bank Group Warrants issued to the Bank Group
in connection with the Plan of Reorganization. By way of example, if the Bank
Group still has 153,959 of the 615,835 Bank Group Warrants originally issued
under the Plan of Reorganization, then such outstanding original Bank Group
Warrants may be redeemed for $125,000.
23
On the date which is on or after the fifth anniversary of the
Effective Date but prior to the sixth anniversary of the Effective Date, the
Debtors shall be entitled to redeem any outstanding Bank Group Warrants for
$1,000,000 multiplied by a fraction, the numerator which is equal to the number
of original Bank Group Warrants still held by the Bank Group and the
denominator which is the number of Bank Group Warrants issued to the Bank Group
in connection with the Plan of Reorganization. By way of example, if the Bank
Group still has 153,959 of the 615,835 Bank Group Warrants originally issued
under the Plan of Reorganization, then such outstanding original Bank Group
Warrants may be redeemed for $250,000.
On the date which is on or after the sixth anniversary of the
Effective Date but prior to the seventh anniversary of the Effective Date, the
Debtors shall be entitled to redeem any outstanding Bank Group Warrants for
$1,500,000 multiplied by a fraction, the numerator which is equal to the number
of original Bank Group Warrants still held by the Bank Group and the
denominator which is the number of Bank Group Warrants issued to the Bank Group
in connection with the Plan. By way of example, if the Bank Group still has
153,959 of the 615,835 Bank Group Warrants originally issued under the Plan of
Reorganization, then such outstanding original Bank Group Warrants may be
redeemed for $375,000.
(4) BANK GROUP WARRANT AGREEMENT.
The Bank Group Warrants will be evidenced by warrant certificates
issued under, and will otherwise be in accordance with the terms and conditions
of, a Bank Group Warrant Agreement, dated as of the Effective Date (the "Bank
Group Warrant Agreement"). The Bank Group Warrant
24
Agreement will be entered into by Reorganized CRC and a warrant agent to be
selected by the Bank Group, and will be substantially in the form to be filed
with the Bankruptcy Court no later than five (5) Business Days before the
deadline for the submission of objections to confirmation of the Plan.
F. MISCELLANEOUS.
--------------
(1) COST OF DOCUMENTATION.
The Debtors and the Bank Group will bear their own costs relating to
the documentation of the Tranche A and Tranche B Notes as well as any security
agreements, financing statements, deeds of trust, other documents required to
secure the Tranche A Note and Tranche B Note or the Bank Group Warrants and
related agreements. If the Bank Group wishes to obtain title insurance or
updates to title insurance policies with respect to the Tranche A Owned
Properties and the Tranche B Owned Properties, the Bank Group shall bear all
costs relating thereto.
(2) MUTUAL RELEASES.
Except for the provisions of the Plan, the Bank Group (and any
predecessor to any current member of the Bank Group), the Debtors in Possession
and the Debtors will execute mutual releases effective as of the Effective Date
in form and substance acceptable to the Bank Group and the Debtors A
post-confirmation default by the Debtors will allow the Bank Group to exercise
any and all rights available to it under the loan documents as modified by the
Plan.
25
(3) CAPITAL EXPENDITURE BUDGET.
The Debtors and the Bank Group will agree to a capital expenditure
budget, sufficient to keep the Tranche A Owned Properties in repair, which
budget shall be submitted to the Court and served on the Committee within 10
calendar days before the Confirmation Hearing.
(4) RESTRICTIONS.
The Debtors and the Bank Group will agree to restrictions relating to
the payment of dividends, changes in management, and incurrence of additional
debt, which restrictions shall be submitted to the Court within 10 calendar
days before the Confirmation Hearing.
(5) BALANCE SHEET LIABILITIES.
Except for obligations owed to the Bank Group, the only debts which
will remain on the Effective Date will be (a) obligations owing to CIT under
the Plan; (b) ordinary course trade payables; (c) unpaid real and personal
property taxes; (d) unpaid priority taxes; (e) unpaid lease obligations; (f)
amounts payable on account of the General Unsecured Claims in Classes
3(a)-3(d); (g) any state or federal income taxes; and (h) any unpaid
Professionals' fees and expenses.
(6) WAIVER OF RIGHT TO BLOCK DISTRIBUTIONS TO BONDHOLDER
GENERAL UNSECURED CLAIMS.
Notwithstanding anything contained in the Plan or any other documents
or agreements to the contrary, including, but not limited to the Debenture
Subordination, the Bank Group agrees to permit the Bondholders to receive
payments from the Debtors in cash and/or warrants as provided under the Plan.
26
4. Class 1(b): Allowed Secured Claim of CIT
Class 1(b) consists of the Allowed Secured Claim of CIT. Class 1(b) is
impaired. The Allowed CIT Secured Claim shall be in the amount of $3,800,000.00
and shall be treated as follows:
A. GENERAL.
The Allowed Secured Claim of CIT consists of the following two (2)
components: (a) an Allowed Secured Claim secured by furniture, fixtures and
equipment located at restaurants the Debtors intend to operate after the
Effective Date (the "CIT Tranche A Claim"); and (b) an Allowed Secured Claim
secured by the furniture, fixtures and equipment located at certain properties
the Debtors are currently marketing for sale (the "CIT Tranche B Claim"). Except
to the extent expressly modified pursuant to the Plan, all of the terms and
conditions of the Equipment Loan Agreement shall continue in full force and
effect, and shall be binding upon the Debtors and CIT.
B. THE CIT TRANCHE A CLAIM.
(1) AMOUNT.
The Allowed CIT Tranche A Claim shall be in the amount of $2,535,000.
(2) MATURITY DATE, INTEREST RATE AND
AMORTIZATION.
The Allowed CIT Tranche A Claim shall mature, and shall then be due and
payable in full, on January 1, 2008 and shall accrue interest, commencing on the
Effective Date at the annual
27
rate of 7%, compounded monthly, and payable in arrears. The Allowed CIT Tranche
A Claim shall be amortized over a seven (7) year period commencing on the
Effective Date.
(3) PAYMENT.
(A) CASH PAYMENT ON EFFECTIVE DATE.
On the Effective Date, the Debtors shall pay CIT $195,000 as a partial
payment on account of the Allowed CIT Tranche A Claim.
(B) INTEREST ONLY PAYMENTS THROUGH
JANUARY 2, 2003.
Commencing on the first day of the first month following the Effective
Date, and continuing on the first day of each month thereafter through January
2, 2003, the Debtors shall make interest only payments to CIT in arrears.
(C) PRINCIPAL AND INTEREST PAYMENTS
THROUGH JANUARY 1, 2008.
Commencing on February 1, 2003 and continuing on the first day of each
month thereafter until January 1, 2008, the Debtors shall make principal and
interest payments to CIT, in arrears, based upon a seven (7) year amortization.
(D) THE CLASS 3(B) BONDHOLDER PAYMENT.
As was noted in Section III of the Disclosure Statement (Background),
pursuant to the Debenture Subordination, the Debtors may not make any payments
to the Bondholders unless CIT (as the holder of "Senior Indebtedness") is paid
in full. In consideration for a waiver of the Debenture Subordination (which
waiver is made solely in connection with the confirmation and
28
performance of the obligations pursuant to the terms of the Plan), 30% of amount
of the Class 3 Available Distributable Cash that would otherwise be paid to
Allowed Class 3(b) Claims (Bondholder General Unsecured Claims) (i.e., 30% of
the Class 3(b) Formula) will be paid to CIT.
(4) SECURITY.
The Allowed CIT Tranche A Claim shall be secured by the CIT Tranche A
FF&E located at the CIT Tranche A Properties.
(5) RELEASE PRICES.
The Debtors may sell the CIT Tranche A FF&E located at any property
upon payment to CIT of $80,000. If, within twenty four (24) months after the
Effective Date, the Debtors close a CIT Tranche A Property at which CIT Tranche
A FF&E is located, the release price for such CIT Tranche A FF&E is reduced to
$55,000, provided that CIT receives such $55,000 on the earlier of (a) six (6)
months after the restaurant is closed; and (b) the date on which the sale of the
CIT Tranche A Property closes.
C. THE CIT TRANCHE B CLAIM.
(1) AMOUNT
The Allowed CIT Tranche B Claim shall be in the amount of $1,265,000
(less certain pre-Confirmation payments).
(2) INTEREST.
The Allowed CIT Tranche B Claim shall not bear interest.
29
(3) NON-RECOURSE.
Except with respect to the Debtors' payment obligations regarding Store
125 (Fort Meyers), Store 163 (Orlando) and Store 157 (Grand Rapids) as provided
in Subsection 5(b) below, the Allowed CIT Tranche B Claim is non-recourse to the
Debtors.
(4) SECURITY.
The Allowed CIT Tranche B Claim shall be secured by the CIT Tranche B
FF&E at the CIT Tranche B Properties.
(5) PAYMENTS.
(A) PRE-EFFECTIVE DATE PAYMENTS ON
ACCOUNT OF CIT TRANCHE B CLAIM.
Upon entry of a Final Order approving a Stipulation between the Debtors
and CIT which provides for CIT's support of the Plan pursuant to the terms
herein, the Debtors shall pay to CIT $385,000.00 (plus interest which actually
accrued on such amounts) which represents $55,000 for each of the following
properties: Johnson City, Evansville, Melbourne, Boynton Beach, Tallahassee,
Gainesville, and Lexington. Payment of these amounts shall reduce the balance of
the Allowed CIT Tranche B Claim.
30
(B) PAYMENTS UPON SALE OF CIT TRANCHE B
PROPERTY (OR A CIT TRANCHE A
PROPERTY WHICH IS CLOSED BEFORE A
SALE WITHIN 24 MONTHS OF THE
EFFECTIVE DATE).
Upon a sale of a CIT Tranche B Property or a CIT Tranche A Property
which is closed before a sale within 24 months of the Effective Date, CIT shall
receive $55,000 that shall reduce the balance of the CIT Tranche B Claim,
whether or not the buyer purchases the CIT Tranche B FF&E as part of that sale.
The Debtors shall not be obligated to pay CIT $55,000 on account of the CIT
Tranche B FF&E in any store until such time as a sale of the CIT Tranche B
Property has closed, provided, however, that with respect to Store 125 (Fort
Meyers), Store 163 (Orlando) and Store 157(Grand Rapids), the Debtors shall pay
CIT $55,000 for each property on the earlier of (a) the closing of a sale of
such property; and (b) June 30, 2003. Upon the closing of the sale of a CIT
Tranche B Property or a CIT Tranche A Property, the Debtors shall pay from
available funds and not from the sales proceeds all unpaid personal property
taxes, including pre-petition taxes, Administrative Personal Property Tax Claims
and post-effective date personal property taxes owing with respect to such sold
property.
D. CIT GENERAL UNSECURED CLAIM
CIT shall have an Allowed General Unsecured Claim in the amount of
$8,791,336.19 (which represents CIT's filed claim of $12,591,336.19 less
$2,535,000 (CIT Tranche A Claim) less $1,265,000 (CIT Tranche B Claim) (the "CIT
General Unsecured Claim "). The CIT General
31
Unsecured Claim shall be classified in Class 3(a) and receive the same treatment
as all other Allowed Class 3(a) General Unsecured Claims.
E. MISCELLANEOUS.
(1) KENNESAW AND GWINETT.
CIT releases any claims it has to furniture, fixtures and equipment
located at the Kennesaw (Store 149) and Gwinnett (Store 147) properties on the
date of the closing of the sale of those two properties and authorizes all Net
Proceeds from the sale of such properties to be paid to the Bank Group. Debtors
acknowledge that any furniture, fixtures and equipment originally financed by
CIT and at one time located at the Kennesaw and Gwinnett properties remain
subject to a duly perfected first priority lien and security interest in favor
of CIT wherever located.
(2) SALE OF FF&E AT LOCATIONS WHERE THE REAL
PROPERTY LEASE HAS BEEN REJECTED.
CIT shall be entitled to sell for its own account any of its collateral
that is or was located at stores where the Debtors have rejected the
corresponding real property leases as of April 10, 2002. These stores are #109
Bethel Road; #115 Memphis; #131 Wildwood; #140 Alpharetta and #167 West Palm
Beach (the "Rejected Stores Equipment"). The Debtors have executed stipulations
for relief from the automatic stay authorizing CIT to proceed with its rights
and remedies with respect to disposal of the Rejected Stores Equipment. The
gross proceeds from the sale of the Rejected Stores Equipment (minus direct
costs of sale, including but not limited to
32
commissions actually paid to third parties) shall be applied to reduce the
amount of the Class 3(a) CIT General Unsecured Claim.
(3) MUTUAL RELEASES.
Except for the provisions of the Plan, CIT, the Debtors in Possession
and the Debtors will execute mutual releases binding upon the Debtors' and their
estates in a form and substance acceptable to the Debtors and CIT effective as
of the Effective Date.
(4) WARRANTS.
CIT may transfer all, or a portion, of the warrants it receives on
account of the CIT General Unsecured Claim to Citigroup and both CIT and
Citigroup shall each be entitled to exercise any warrants they receive at their
own discretion.
(5) STORE 110 (NASHVILLE)
CIT shall endorse for the Debtors' benefit any insurance checks
presented to CIT in connection with any replacement and/or repairs made by the
Debtor prior to May 1, 2002 with respect to Store Number 110 (Nashville).
5. Class 1(c): Secured Real Property Tax Claims
Class 1(c) consists of all of the claims of taxing authorities secured
by real property owned by the Debtors (the "Secured Real Property Tax Claims").
Class 1(c) is impaired. Attached to the Disclosure Statement as EXHIBIT H is a
listing of all of the Secured Real Property Tax Claims that have been filed in
these cases. In addition, EXHIBIT H includes a listing of what the Debtors
records' reflect as the total secured real property tax claims (including the
filed
33
claims). The Debtors intend to reconcile the filed claims to the Debtors'
records prior to the hearing on the Disclosure Statement and intend to submit an
amended EXHIBIT H at that time.(5)
TABLE 5: TREATMENT OF ALLOWED SECURED REAL PROPERTY TAX CLAIMS
CLASS CLAIMANT INSIDER CLAIM AMOUNT TREATMENT
NO.
- -------- ---------------------- ------- ------------- ------------------------------------------------------
1(c) All holders of Real N Approximately Holders of Allowed Real Property Tax Claims shall be
Property Tax Claims as $401,000.00 paid in full as follows: monthly payments of
further identified on principal and interest for four (4) years at an
EXHIBIT H TO THE interest rate of 5.5% per annum.
DISCLOSURE STATEMENT
6. Class 1(d): PACA Claims
Class 1(d) consists of all of the Holders of claims under the
Perishable Agricultural Commodities Act ("PACA") (the "PACA Claims"). Class 1(d)
is unimpaired. Attached to the Disclosure Statement as EXHIBIT J is a listing of
all of the PACA Claims.(6)
TABLE 6: TREATMENT OF ALLOWED PACA CLAIMS
CLASS CLAIMANT INSIDER CLAIM AMOUNT TREATMENT
NO.
- -------- ---------------------- ------- ------------- ------------------------------------------------------
1(d) All holders of PACA N Approximately Paid in full on the later of (1) the Effective Date
Claims as further $108,000.00 or (2) the date upon which the Claim is Allowed
identified on EXHIBIT pursuant to a Final Order.
J to the Disclosure
Statement
7. Class 1(e): Reclamation Claims
Class 1(e) consists of all of the holders of reclamation claims, which
are secured by the goods subject to reclamation pursuant to Uniform Commercial
Code section 2-701 and
- ---------------------------
(5) The Debtors reserve their rights to object to the amount, validity and/or
priority of any and all Secured Real Property Tax Claims.
(6) The Debtors reserve their rights to object to the amount, validity and/or
priority of any and all PACA Claims.
34
Bankruptcy Code section 546(c)(the "Reclamation Claims"). Class 1(e) is
unimpaired. Attached to the Disclosure Statement as EXHIBIT K is a listing of
all of the Reclamation Claims.(7)
TABLE 7: TREATMENT OF ALLOWED RECLAMATION CLAIMS
CLASS CLAIMANT INSIDER CLAIM AMOUNT TREATMENT
NO.
- -------- ---------------------- ------- ------------- ------------------------------------------------------
1(e) All holders of N Approximately Paid in full on the later of (1) the Effective Date
Reclamation Claims as $20,000.00 or (2) the date upon which the Claim is Allowed
further identified on pursuant to a Final Order.
EXHIBIT K to the
Disclosure Statement
8. Class 1(f): Secured Personal Property Tax Claims
Class 1(f) consists of all of the Claims of taxing authorities secured
by personal property owned by the Debtors (the "Secured Personal Property Tax
Claims"). Class 1(f) is impaired. Attached to the Disclosure Statement as
EXHIBIT L is a list of what the Debtors' records reflect as the outstanding
pre-petition Secured Personal Property Tax Claims.(8) The Debtors are still in
the process of reconciling these amounts to any claims that may have been filed
as Secured Personal Property Tax Claims.(9) The Debtors intend to reconcile the
filed claims to the Debtors' records prior to the hearing on the Disclosure
Statement and intend to submit an amended EXHIBIT L at that time.
- --------------------------
(7) The Debtors reserve their rights to object to the amount, validity and/or
priority of any and all Reclamation Claims.
(8) The Debtors reserve their rights to object to the amount, validity and/or
priority of any and all Secured Personal Property Tax Claims.
(9) The Debtors projections estimate these taxes at $82,000. However, it is
presently believed that the taxes are less.
35
TABLE 8: TREATMENT OF ALLOWED SECURED PERSONAL PROPERTY TAX CLAIMS
CLASS CLAIMANT INSIDER CLAIM AMOUNT TREATMENT
NO.
- -------- ---------------------- ------- ------------- ------------------------------------------------------
1(f) All holders of N Approximately Holders of Allowed Personal Property Tax Claims
Personal Property Tax $50,000.00 shall be paid in full as follows: monthly payments
Claims as further of principal and interest for six (6) years at an
identified on EXHIBIT interest rate of 5.5% per annum.
L to the Disclosure
Statement
9. Class 1(g): Subordinate Secured Real Property Claims
Class 1(g) consists of all claims secured by the Bank Group Tranche A
& B Properties that are junior to the liens held by the Bank Group for the
Senior Secured Debt (the "Subordinate Real Property Claims"). Class 1(g) is
impaired. The Debtors are not aware of any claims in this class.(10)
TABLE 9: TREATMENT OF ALLOWED SUBORDINATE REAL PROPERTY CLAIMS
CLASS CLAIMANT INSIDER CLAIM AMOUNT TREATMENT
NO.
- -------- ---------------------- ------- ------------- ------------------------------------------------------
1(g) All holders of N $0.00 Holders of Allowed Subordinate Real Property Claims
Subordinate Real are under-secured and shall receive the same
Property Claims treatment as Allowed Class 3(a) Claims (General
Unsecured Claims). All liens and encumbrances shall
be discharged and terminated as to the properties
encumbered.
10. Class of Priority Non-Tax Claims
Certain priority Claims that are referred to in Code Sections
507(a)(3), (4), (5), (6), and (7) are required to be placed in classes. These
types of Claims are entitled to priority treatment as follows: the Code requires
that each holder of such a Claim receive cash on the Effective Date equal to the
allowed amount of such Claim. However, a class of Priority Non-Tax Claims may
- ---------------------------
(10) The Debtors reserve their rights to object to the amount, validity and/or
priority of any and all Subordinate Real Property Claims.
36
vote to accept deferred cash payments of a value, as of the Effective Date,
equal to the Allowed amount of such Claims. As discussed above, early on in
these Cases, the Debtors obtained authority from the Court to pay certain
pre-petition Claims of current employees. However, there are currently
outstanding certain unpaid Priority Non-Tax Claims held by employees and former
employees of the Debtors which the Debtors estimate will be allowed in an amount
equal to $12,3412.48. Attached to the Disclosure Statement as EXHIBIT N is a
list of Priority Non-Tax Claims, the treatment under the Plan of which is as
follows: (11)
TABLE 10: TREATMENT OF ALLOWED PRIORITY NON-TAX CLAIMS
CLASS. CLAIMANT AMOUNT TREATMENT
- -------- ---------------------- ------------- ------------------------------------------------------
2
Priority Non-Tax Claims $12,341.48 Allowed Claims will be paid in full on the later of (1)
as listed on EXHIBIT N the Effective Date; or (2) the date upon which the
to the Disclosure Claim becomes an Allowed Claim pursuant to a
Statement Final Order.
In addition, the Debtors scheduled $1,168,853.76 in 507(a)(3) and
(a)(4) claims. However, as was noted above, the Court previously entered its
Order Authorizing, But Not Requiring, the Debtors to Pay Pre-Petition Employee
Wages, Salaries and Contributions to Employee Benefit Plans entered on June 5,
2001, which authorized the Debtors to pay $1,735,872.11 in pre-petition employee
wage and $977,000.00 in benefit claims. The Debtors believe that pursuant to the
Order all such priority claims owing to its employees have already been paid.
The Debtors intend to file an objection to this scheduled claim shortly.
- ---------------------------
(11) The Debtors reserve their rights to object to the amount, validity and/or
priority of any and all Priority Non-Tax Claims.
37
11. Classes of Unsecured Claims
Unsecured Claims are unsecured Claims not entitled to priority under
Code section 507(a). EXHIBIT P to the Disclosure Statement contains an
itemization of all Unsecured Claims against the Debtors' Estates. As is
further described below, the Debtors' Unsecured Claims shall be classified as
follows:(12)
TABLE 11: SUMMARY OF CLASSIFICATION OF UNSECURED CLAIMS
CLASS DESCRIPTION
- ----- ----------------------------------------------------------------
3(a) Class 3(a) is comprised of all Unsecured Claims against the
Debtors, including the CIT General Unsecured Claim (the "General
Unsecured Claims"). Class 3(a) does not include the Bondholder
General Unsecured Claims or the Bank Group General Unsecured
Claim The Debtors estimate that Class 3(a) Claims total between
$15,300,000.00-$21,400.00.00.
3(b) Class 3(b) is comprised of the Claims of all of the Bondholders
under the Debentures (the "Bondholder Unsecured Claims"). The
Allowed amount of the Class 3(b) Claims is $13,296,729.69.
3(c) Class 3(c) is comprised of the Bank Group General Unsecured
Claim. The Debtors estimate that Class 3(c) Claim totals
between $0.00-$3,000,000.00.
A. CLASSES 3(A)-3(C)
Classes 3(a)-(c) are all impaired. As is further described below,
Classes 3(a)-3(c) shall receive the following distributions: (a) a share of
Class 3 Available Distributable Cash; (b) proceeds of certain Rights of Action
(the Seelbinder Litigation and the Preference Actions); (c) Warrants in
Reorganized CRC.
(1) CLASS 3 AVAILABLE DISTRIBUTABLE CASH
Subject to the availability of the Tax Refund holders of Allowed Class
3(a), 3(b) and 3(c) Claims shall receive a Pro Rata share of up to $4,000,000.00
(plus interest on that portion of the Tax Refund Escrow that is payable to
Holders of Allowed Class 3(a), 3(b) and 3(c) General
- -------------------
(12) The Debtors reserve their rights to object to the amount, validity and/or
priority of any and all Unsecured Claims.
38
Unsecured Claims (the "Class 3 Escrow Interest")) calculated and paid as set
forth below. Provided however, that the Committee shall be entitled to segregate
up to $200,000.00 of such amount to fund the litigation assigned to the Class
3(a)-3(c) Creditors under the Plan and the Creditor Trust Trustee's fees and
expenses and the pursuit of all rights, duties and obligations of the Committee
under the Plan (the "Litigation Reserves"). The Committee shall inform the
Debtors no later than 10 days before the Confirmation Hearing as to the amount
of the Litigation Reserves. The amount of cash to be available to pay Allowed
Class 3(a)-3(c) Claims (net of Litigation Reserves and inclusive of the Class 3
Escrow Interest) shall be referred to herein as the Class 3 Available
Distributable Cash.
(A) CLASS 3(A) SHARE
All holders of Allowed Class 3(a) Claims shall share Pro Rata in the
Class 3 Available Distributable Cash calculated as follows:
- FORMULA: (Total dollar amount of Class 3(a) Claims) DIVIDED by
(total dollar amount of Class 3(a) Claims plus total dollar
amount of Class 3(b) Claims plus total dollar amount of Class
3(c) Claims) MULTIPLIED by the Class 3 Available Distributable
Cash (the "Class 3(a) Formula") MULTIPLIED by 90% (the "Class
3(a) Share").
- EXAMPLE: By way of example only, assuming that Class 3(a)
Claims total $18,000,000.00, Class 3(b) Claims total
$13,000,000.00, Class 3(c) Claims total $3,000,000.00, and
that Class 3 Available Distributable Cash equals
39
$3,900,000.00, the calculation would be as follows:
$18,000,000.00 /$34,000,000.00 =.53 x $3,900,000.00 =
$2,067,000.00 (i.e., the Class 3(a) Formula) x 90% =
$1,860,300.00 (i.e., the Class 3(a) Share).
(B) CLASS 3(B) SHARE
(a) Holders of Allowed Class 3(b) Claims shall share Pro Rata in the
Class 3 Available Distributable Cash as follows:
- FORMULA: (Total dollar amount of Class 3(b) Claims) DIVIDED by
(total dollar amount of Class 3(a) Claims plus total dollar
amount of Class 3(b) Claims plus total dollar amount of Class
3(c) Claims) MULTIPLIED by Class 3 Available Distributable
Cash (the "Class 3(b) Formula") MULTIPLIED by 70% (the "Class
3(b) Share").
- EXAMPLE: By way of example only, assuming that Class 3(a)
Claims total $18,000,000.00, Class 3(b) Claims total
$13,000,000.00, Class 3(c) Claims total $3,000,000.00, and
Class 3 Available Distributable Cash equals $3,900,000.00, the
calculation would be as follows:
$13,000,000.00/$34,000,000.00 =.38 x $3,900,000.00 =
$1,482,000.00 (i.e., the Class 3(b) Formula) x 70% =
$1,037,400.00 (i.e., the Class 3(b) Share).
(b) Concurrently with the Distributions to Holders of Allowed Class
3(a) Claims, Holders of Allowed Class 3(b) Claims shall also receive payments
equal to an amount that is 10% of the
40
Class 3(a) Formula. In the example above, the Class 3(a) Formula is equal to =
$2,067,000.00 x 10% equals $206,700.00.
(c) Concurrently with the Distributions to Holders of Allowed Class
3(c) Claims, Holders of Allowed Class 3(b) Claims shall also receive payments
equal to an amount that is 10% of the Class 3(c) Formula. In the example above,
the Class 3(c) Formula is equal to $351,000.00 x 10% equals $35,100.00.
(C) CLASS 3(C) SHARE
All holders of Allowed Class 3(c) Claims shall share Pro Rata in the
Class 3 Available Distributable Cash calculated as follows:
- FORMULA: (Total dollar amount of Class 3(c) Claims) DIVIDED by
(total dollar amount of Class 3(a) Claims plus total dollar
amount of Class 3(b) Claims plus total dollar amount of Class
3(c) Claims) MULTIPLIED by Class 3 Available Distributable
Cash (the "Class 3(c) Formula") MULTIPLIED by 90% (the "Class
3(c) Share").
- EXAMPLE: By way of example only, assuming that Class 3(c)
Claims total $18,000,000.00, Class 3(b) Claims total
$13,000,000.00, Class 3(c) Claims total $3,000,000.00, and
Class 3 Available Distributable Cash equals $3,900,000.00, the
calculation would be as follows: $3,000,000.00/$34,000,000.00
=.09 x $3,900,000.00 = $351,000.00 (i.e., the Class 3(c)
Formula) x 90% = $315,900.00 (i.e., the Class 3(c) Share).
41
(D) TIMING OF THE PAYMENTS
(I) INITIAL CASH PAYMENT OF CLASS 3
AVAILABLE DISTRIBUTABLE CASH
Upon the Effective Date, the Debtors shall make a Pro Rata cash payment
totaling $1,200,000.00 (less the Litigation Reserves) to holders of the Allowed
Class 3(a), 3(b) and 3(c) Claims (the "Initial Cash Distribution").
(II) REMAINING CASH PAYMENT OF CLASS 3
AVAILABLE DISTRIBUTABLE CASH
The source of funds for the remainder of the Class 3 Available
Distributable Cash of $2,800,000.00 plus the Class 3 Escrow Interest (the
"Remaining Cash Payment") shall be the Tax Refund. The Debtors shall escrow the
Tax Refund (less the Initial Cash Payment) when received from the IRS in the Tax
Refund Escrow, and said Tax Refund (less the Initial Cash Payment) shall be held
in the Tax Refund escrow until such time as there is a final Tax Refund
Determination with respect to the Tax Refund. Within 10 business days of the
occurrence of the Tax Refund Determination, the Debtors shall pay the Remaining
Cash Payment Pro Rata to Holders of Allowed Class 3(a), 3(b), and 3(c) Claims,
subject to the reserves set forth for Disputed Claims.
Should the IRS determine that the Debtors are not entitled to the full
amount of the Tax Refund and the Debtors agree, or the Court so orders, the
Remaining Cash Payment shall equal the final IRS determination of the Tax Refund
(the "Adjusted Tax Refund") less the difference
42
between the Tax Refund and the Adjusted Tax Refund up to a maximum deduction of
$775,000.00 up to a maximum "Remaining Cash Payment of $2,800,000.00 plus the
Class 3 Escrow Interest.
For example, should the Adjusted Tax Refund be reduced to $3,000,000.00
(from the expected $3,700,000.00), the Remaining Cash Payment owing would be
$2,225,000.00 plus the Class 3 Escrow Interests (the Adjusted Tax Refund less
$775,000.00 plus the Class 3 Escrow Interest).
(III) NO PAYMENTS ON CLASS 3(C)
Notwithstanding anything contained herein, no payments shall be paid on
account of Class 3(c) Claims (Bank Group General Unsecured Claim) until such
time as the amount of said claim has been liquidated and allowed.
(2) WARRANTS.
(A) GENERAL
On the Effective Date, the Debtors will issue to CIT, in respect of its
Allowed Class 3(a) Claim, its Pro Rata Share (together with all other Allowed
Class 3(a) Claims and the Allowed Class 3(b) Claims) of warrants for the
purchase of 923,077 shares of the New Common Stock in Reorganized CRC Holders
(the "Class 3 Warrants"), representing an amount equal to 15%, in the aggregate,
of the shares of New Common Stock to be issued or reserved for issuance under
the Plan, other than shares reserved for the Employee Incentive Stock Plan.
43
In addition, on the Effective Date, the Debtors will issue to the
Creditor Trust, in respect of all Allowed Class 3(a) Claims (other than CIT's
Allowed Class 3(a) Claim) and all Allowed Class 3(b) Claims), all Class 3
Warrants other than the Class 3 Warrants issuable in respect of CIT's Allowed
Class 3(a) Claim. On the Effective Date, each Holder of an Allowed Class 3 Claim
will receive such Holder's Pro Rata Share of beneficial interests in the
Creditor Trust.
The Class 3 Warrants will contain anti-dilution protection (subject to
dilution in connection with the issuance of an additional 5% of the New Common
Stock of Reorganized CRC to management of Reorganized CRC pursuant to the
Employee Incentive Stock Plan).
No warrants will be issued to Holders of Allowed Class 3(c) Claims.
(B) EXERCISE AND STRIKE PRICE
Common stock will be issued to the new investors for $1 per share.
Accordingly, the exercise price for the Class 3 Warrants shall be as follows:
(a) for $1.50 per share for the period from the Effective Date until the date
which is the second anniversary of the Plan; and (b) $1.75 per share for the
period which is the date following the second anniversary of the Effective Date
of the Plan until the date which is the third anniversary of the Effective Date
of the Plan. All unexercised Class 3 Warrants shall expire on the date which is
the earlier of (a) the third anniversary of the Effective Date of the Plan; and
(b) the expiration of the 90-day period beginning on the effective date of the
registration under Section 12(g) or Section 12(g) of any class of equity
securities of Reorganized CRC. Subject to any applicable securities
restrictions, Reorganized CRC shall use its best efforts to give the holders of
Class 3 Warrants, the Committee
44
and the Creditor Trust Trustee as much advance notice as practicable of the
anticipated effectiveness of any such effective date, and in any event, shall
provide notice of any such effective date as of that date.
(C) TRUST FOR CLASS 3 WARRANTS
As of the Effective Date, all Class 3 Warrants other than Class 3
Warrants issuable in respect of CIT's Allowed Class 3(a) Claim will be issued in
the name of the Creditor Trust Trustee on behalf of the beneficiaries of the
Creditor Trust. So long as the Class 3 Warrants remain in the Creditor Trust,
the Creditor Trust will hold, retain and exercise all rights as the sole holder
of record of (a) all Class 3 Warrants issued in exchange for Class 3 Claims
other than CIT's Allowed Class 3(a) Claim, including but not limited to the
right to exercise such warrants, and (b) all shares of New Common Stock issuable
upon exercise of such warrants.
The Creditor Trust Trustee shall be required to distribute trust assets
(including but not limited to the Class 3 Warrants or any New Common Stock
issuable upon exercise thereof) as soon as practicable after such distribution
is authorized under the Creditor Trust Agreement. Unless otherwise provided in
the Creditor Trust Agreement, if at any time no such distribution is authorized
and any Class 3 Warrants must be exercised to avoid expiration, the Creditor
Trust Trustee shall be required to exercise such warrants. The Creditor Trust
Trustee shall have the right, at its option, to exercise the Class 3 Warrants on
a "cashless" basis (i.e., in which Reorganized CRC, in lieu of receiving cash
equal to the aggregate exercise price of the warrants being exercised, will
cancel the number of shares subject to the warrants being exercised by the
45
Creditor Trust that is equivalent in value to the aggregate exercise price of
the warrants being exercised and will issue to the Creditor Trust Trustee the
remaining shares subject to the warrants being exercised). For purposes of
determining the number of shares of New Common Stock to be cancelled,
Reorganized CRC shall be authorized to use any valuation method, consistently
applied, that is deemed by its Board of Directors and the Creditor Trust Trustee
(with notice to the Committee) in good faith to be appropriate. If a dispute
regarding such valuation arises, such dispute shall be resolved by binding
arbitration. The Creditor Trust Trustee shall be authorized to distribute trust
assets upon the earlier of (a) the registration by Reorganized CRC of any class
of equity securities under Section 12(b) or 12(g) of the Exchange Act or (b) the
third anniversary of the Effective Date. The Creditor Trust Trustee shall
distribute the Warrants or New Common Stock (as the case may be) in accordance
with each beneficiary's Pro Rata Share of the beneficial interests in the Trust.
Unless otherwise provided in the Creditor Trust Agreement, the term of the
Creditor Trust will expire 120 days after the trust assets are authorized for
distribution, unless such expiration is extended by Bankruptcy Court upon a
finding such extension is required in order to wind up the trust's affairs.
Beneficial interests in the Creditor Trust will be deemed fully paid
and non-assessable when issued, and will be uncertificated and non-transferable
other than by death or operation of law. The Creditor Trust will otherwise be in
accordance with the terms and conditions of the Creditor Trust Agreement, dated
as of the Effective Date. The Creditor Trust Agreement will be entered into
between Reorganized CRC, as grantor, and the Creditor Trust Trustee, as trustee,
and
46
will be substantially in the form to be filed with the Bankruptcy Court (and
served on the Committee) no later than ten (10) Business Days before the
deadline for the submission of objections to confirmation of the Plan. The
Creditor Trust Agreement shall be approved by the Committee.
(D) INDENTURE TRUSTEE FEES
On or before the Effective Date, the Debtors shall pay to the Indenture
Trustee under the Debentures the lesser of:(a) the actual amount of fees
(subject to a reasonableness standard) owing under the Debenture; and (b)
$125,000.00 (the "Indenture Trustee Fee"). The Indenture Trustee fee shall be
paid as an expense of administration. The Confirmation Order shall contain a
finding that the Indenture Trustee's fees are reasonable.
(E) CREDITOR TRUST AGREEMENT.
The Class 3 Warrants will be evidenced by warrant certificates issued
under, and will otherwise be in accordance with the terms and conditions of, the
Creditor Trust Agreement. The Creditor Trust Agreement will be entered into
between Reorganized CRC, as the issuer, and the Creditor Trust Trustee, and will
be substantially in the form to be filed with the Bankruptcy Court (and served
on the Committee) no later than ten (10) calendar days before the deadline for
the submission of objections to confirmation of the Plan. The Creditor Trust
Agreement shall be approved by the Committee.
47
(3) LITIGATION PROCEEDS
Holders of allowed Class 3(a), 3(b) and Class 3(c) Claims shall also
share Pro Rata in proceeds of certain litigation (the "Litigation Proceeds")
described in Subsections (a) and (b) below.
(A) CLAIMS AGAINST ARTHUR SEELBINDER.
The Debtors shall assign to the Committee, for prosecution on behalf of
the Holders of all Allowed General Unsecured Claims (Classes 3(a), 3(b), and
3(c)), the Debtors' Estates' claims against Arthur Seelbinder et. al. (the
"Seelbinder Litigation") without representation or warranty of any kind. The
Debtors shall not be responsible for payment of any attorneys' fees or costs
relating to prosecution of the Seelbinder Litigation.
(B) PREFERENCE ACTIONS.
The Debtors shall assign to the Committee, for prosecution on behalf of
the Holders of all Allowed Class 3(a), 3(b), and 3(c) Creditors, the Debtors'
Estates' claims to recover transfers as avoidable preferences under section 547
of the Bankruptcy Code, which are identified on EXHIBIT F to the Disclosure
Statement (but excluding any payments made to any member of the Bank Group, any
prior member of the Bank Group and/or to Winthrop) (the "Preference Actions").
All proceeds of Preference Actions (less any amounts approved by the Committee
for the payment of the Committee's fees and expenses) shall be turned over to
the Reorganized CRC who shall hold such monies in a segregated account and be
used to pay the Allowed Claims of Class 3(a), (b) and (c) Creditors as provided
in the Plan.
48
Notwithstanding the foregoing, the Committee shall not commence
prosecution of any Preference Actions until the Claim Objection Bar Date.
Thereafter, the Committee may commence prosecution of any Preference Action
unless the Debtors have filed an objection to a Claim and asserted, as a defense
to payment of such Claim under section 502(d) of the Bankruptcy Code, that the
holder of a Claims is a recipient of a transfer which may be avoidable under
Sections 544, 547, 548, 549 and 550 of the Bankruptcy Code and equivalent or
analogous state law actions (a "Defensive Avoidance Action"). The Debtors may
settle and compromise any Defensive Avoidance Action with the written consent of
the Committee or Bankruptcy Court approval.
(C) TIMING OF PAYMENTS
The Debtors shall pay Litigation Proceeds to Holders of Allowed Class
3(a)-3(c) Claims on a semi-annual basis (on the last business day in January and
the last business day in July (the "Semi Annual Payment Date") provided that the
Debtors have Litigation Proceeds, which total $500,000.00 or more to distribute
(combined with the proceeds of the Disputed Claims). If the Debtors have less
than $500,000 in Litigation Proceeds and proceeds of Disputed Claims on any Semi
Annual Payment Date, the Debtors shall retain said proceeds and wait to pay them
until the next Semi-annual Payment Date on which the Litigation Proceeds and
Disputed Claims Proceeds total more than $500,000.00.
49
(D) ATTORNEYS FEES AND COSTS
The Committee shall be entitled to retain counsel and other
professionals to assist it in prosecuting the Preference Actions, provided,
however, that all such fees and expenses shall be paid from the Litigation
Reserves and that the Debtors shall have no liability beyond the Litigation
Reserves for such payments.
(E) DELIVERY OF FINANCIAL STATEMENTS
During such time as the Reorganized Debtor may not be subject to
reporting obligations under to Section 13(a) or Section 15(d) of the Exchange
Act, Reorganized CRC shall deliver to the trustee of the Creditor Trust:
- As soon as practicable, but in any event within ninety (90)
days after the end of each fiscal year of Reorganized CRC, an
income statement for such fiscal year, a balance sheet and
statement of shareholder's equity as of the end of such year,
and a statement of cash flows for such year, such year-end
financial reports to be in reasonable detail, prepared in
accordance with generally accepted accounting principles, and
audited and certified by an independent public accounting form
of nationally recognized standing selected by the Reorganized
CRC.
- As soon as practicable, but in any event within forty-five
(45) days after the end of each fiscal quarter of Reorganized
CRC, an unaudited profit or loss statement and statement of
cash flows for such fiscal quarter and an unaudited balance
sheet as of the end of such fiscal quarter.
50
(F) RULE 144 REPORTING.
With a view to making available to the Holders the benefits of certain
rules and regulations of the Securities and Exchange Commission which may permit
the sale of the Securities to the public without registration, Reorganized CRC
agrees at all times after ninety (90) days after the effective date of the first
registration filed by Reorganized CRC for an offering of its securities to the
general public to:
- Make and keep public information available, as those terms are
understood and defined in Rule 144;
- Use its best efforts to file with the Securities and Exchange
Commission in a timely manner all reports and other documents
required of Reorganized CRC under the Securities Act of 1933
and the Exchange Act of 1934, both as amended.
E. CLASS(ES) OF INTEREST HOLDERS
Interest holders are the Persons who hold Common Stock in CRC and
partnership interests in SCLP. The following chart identifies the Plan's
treatment of the Debtors' Interest Holders:
TABLE 12: SUMMARY OF TREATMENT FOR INTEREST HOLDERS
CLASS TYPE OF INTEREST TREATMENT
- ----- ------------------------------------ -------------------------------------------------
4 Common Stock of CRC, Restricted All Interests in each of the Debtors will be
Stock held pursuant to Cooker 23001 extinguished. All Holders of Interests are deemed
Restricted Stock Plan and all related to have rejected the Plan.
rights to acquire shares of Class A
Junior Participating Preferred Shares,
and all equity interests in and to each
of the Debtors and all options,
warrants or other rights to purchase
securities of the Debtors ("Interests")
51
F. MEANS OF EFFECTUATING THE PLAN
1. Funding for the Plan
A. CASH NEEDS ON THE EFFECTIVE DATE.
After taking into account all of the payments described in the Plan,
the Debtors will have the following cash needs on the Effective Date.
TABLE 13: SUMMARY OF CASH NEEDS ON EFFECTIVE DATE
TYPE OF PAYMENT AMOUNT
- --------------- ------
Administrative Claims (Non-Professionals) $3,067,719.50
Administrative Claims (Professionals) $ 284,396.50
Executory Contract Cures $ 254,964.55
Allowed Reclamation Claims $ 20,000.00
Allowed PACA Claims $ 108,000.00
Distribution on account of Allowed Class 3(a), $1,000,000.00
(b), and (c) Claims
Litigation Reserves $ 200,000.00
TOTAL $4,935,080.55
2. Sources of Cash on the Effective Date.
The Debtors will generate the Cash needed to make payments required on
the Effective Date as follows: (a) Cash on hand as of the Effective Date; (b)
net proceeds from the sale of Closed Stores; (c) $1,000,000.00 in proceeds from
the sale of the Tranche B Properties that have sold before the Effective Date;
(d) proceeds of the sale of certain unencumbered Assets; (e) $4,000,000.00
generated from the sale of stock in Reorganized CRC; and (e) the $3,700,000.00
Tax Refund (if received before the Effective Date).
52
3. Equity Capital
Under the Plan, as of the Effective Date, all of the equity securities
of CRC outstanding immediately before the Effective Date will be cancelled. The
authorized capital stock of Reorganized CRC will consist of a single class of
common stock, no par value (the "New Common Stock"). Each share of the New
Common Stock will be validly issued, fully paid and non-assessable and will be
entitled to identical rights as to voting, dividends, status in liquidation and
otherwise. As discussed elsewhere in this Disclosure Statement, however, holders
of shares of New Common Stock issuable upon exercise of Bank Group Warrants will
be entitled to special shareholder rights, called "tag along/drag along" rights.
A. SHARES OF REORGANIZED CRC
Shares of the New Common Stock will be issued or reserved for issuance
as of the Effective Date. The Debtors expect that the number of shares to be
issued or reserved for issuance by Reorganized CRC (exclusive of 323,887 shares
issuable from time to time in the discretion of the Board of Directors in
accordance with the Employee Incentive Stock Plan) will be 6,153,847.
Of the 6,153,847 shares, (a) 4,000,000 (or 65%) will be offered and
sold on or before the Effective Date for $1.00 per share in a cash offering to
investors (the "Investor Offering"), (b) 615,835 (or 10%) will be issued or
reserved for issuance as of the Effective Date to management and employees of
the Debtors pursuant to the Chapter 11 Stock Plan, (c) 615,835 (or 10%) will be
reserved for issuance after the Effective Date upon the exercise of the Bank
Group Warrants
53
issued in exchange for Claims held by the Bank Group, and (d) 923,077 (or 15%)
will be reserved for issuance after the Effective Date upon exercise of the
General Unsecured Claim Warrants issued in exchange for Claims held by the
holders of Allowed Class 3(a) and 3(b) Claims. The issuance of an additional
323,887 shares (or 5% of the Reorganized CRC) pursuant to the Employee Incentive
Stock Plan will increase the total number of shares authorized under the Plan to
6,477,734 and is expected to have a modestly dilutive effect upon the equity
holders of Reorganized CRC.
The purpose of the Investor Offering is to raise new capital of
$4,000,000 in cash in order to perform the requirements of the Plan and to meet
foreseeable future needs. The Investor Offering will be made pursuant to the
"private offering" exemption from registration under the Securities Act of 1933,
as amended (the "Securities Act") afforded by Section 4(2) of the Securities Act
and/or Regulation D of the Securities and Exchange Commission (the "SEC") and
similar exemptions from registration or qualification under state securities or
"blue sky" laws. Consistent with the requirements of these exemptions, the
Investor Offering will be made without general solicitation or general
advertising and only to a relatively small number of "accredited investors" as
defined by Rule 501(a) of Regulation D. The Debtors reserve the right, in their
sole discretion, to establish additional investor suitability standards and to
approve each investor's participation in the Investor Offering. Some or all of
the participants in the Investor Offering may be officers, directors, employees,
shareholders, consultants, vendors, or affiliates of the Debtors.
54
On June 19, 2002, the Debtors commenced the Investor Offering by
delivering the offering materials to prospective purchasers (consisting
primarily of certain stockholders of CRC). The offering materials included the
then current draft of the Disclosure Statement, a form of subscription
agreement, and other documents. Prospective purchasers in the Investor Offering
may request additional material information from the Debtors. To purchase shares
in the Investor Offering, prospective purchasers will be required to demonstrate
their eligibility to participate in the offering and must deliver signed
subscription agreements. They also will be required to acknowledge that the New
Common Stock will be "restricted securities" (and therefore may not be resold in
the absence of any effective registration under the Securities Act or an
exemption from such registration). Investors must state that they are purchasing
New Common Stock for investment and not with the intent of resale in a
distribution.
The Debtors expect to begin receiving signed subscription agreements in
early July 2002. Subscription funds will be deposited into a subscription escrow
as and when received. As soon as practicable following the Bankruptcy Court's
approval of the final form of Disclosure Statement, the Debtors intend to
deliver the final Disclosure Statement as so approved to all prospective
purchasers. Under the terms of the Investor Offering, each investor will be
entitled to cancel his subscription and receive a full refund of any amount paid
during the 10-day period following delivery of the final Disclosure Statement.
Assuming that investors do not exercise their cancellation right, the Debtors
believe that the Investor Offering will be fully subscribed. All subscriptions
must be delivered, and all subscription funds deposited into escrow, on or
before the
55
tenth (10th) calendar day before the deadline for filing objections to
confirmation of the Plan. Notice of the Debtors' receipt of, and the respective
amounts of, subscription agreements shall be delivered by the Debtors to the
Committee, the Bank Group and CIT on or before the 10th calendar day before the
deadline for filing objections to confirmation of the Plan. Closing of the
subscription escrow shall take place on the Effective Date of the Plan.
The Shares of New Common Stock issuable to the Debtors' employees under
the Chapter 11 Stock Plan will be issued as compensation for additional work
performed during the Debtors' Chapter 11 proceedings. Awards under the Chapter
11 Stock Plan will be made by the board of directors of Reorganized CRC, or a
committee thereof, in its sole discretion, subject to the eligibility
requirements of such plan. Shares awarded under the Chapter 11 Stock Plan will
be "restricted securities" and therefore may not be resold in the absence of an
effective registration under the Securities Act or an exemption from such
registration.
B. NEW WARRANTS.
As of the Effective Date, and in exchange for certain Allowed Claims,
Reorganized CRC will issue warrants to purchase an aggregate of 1,538,912 shares
of New Common Stock (the "New Warrants"), which amount is equal to 25% of
Reorganized CRC before the issuance of any shares pursuant to the Employee
Incentive Stock Plan. The New Warrants consist of (a) warrants issued in
exchange for certain Allowed Claims held by the Bank Group (i.e., the Bank Group
Warrants), conferring the right to purchase 615,835 shares (or 40% of all shares
issuable upon exercise of New Warrants) and (b) warrants issued in exchange for
certain Allowed Class 3
56
Claims (i.e., the Class 3 Warrants), conferring the right to purchase 923,077
shares (or 60% of all shares issuable upon exercise of New Warrants).
Generally, the New Warrants, and the New Common Stock issuable upon
exercise thereof, should not be deemed "restricted securities" and therefore
should be transferable without registration under federal and state securities
laws, other than by persons or groups deemed to be "underwriters" with respect
to such securities. However, the Class 3 Warrants issued in respect of Class 3
Claims other than CIT's Allowed Class 3(a) Claim will be held in trust for the
Holders of such Claims and will not be immediately distributed to them (Please
see discussion in section entitled, "TRUST FOR CLASS 3 WARRANTS" supra).
C. NEW COMMON STOCK UNDER EMPLOYEE INCENTIVE STOCK PLAN.
As of the Effective Date, Reorganized CRC will reserve additional
shares of New Common Stock for future issuance pursuant to pursuant to the
Employee Incentive Stock Plan. The aggregate shares to be reserved will be
323,887, an amount equal to five percent (5%) of Reorganized CRC after giving
effect to the issuance of all shares of New Common Stock authorized under the
Plan to be issued or reserved (including shares offered and sold in the Investor
Offering, issued or reserved under the Chapter 11 Stock Plan, or reserved for
issuance upon exercise of New Warrants).
Awards under the Employee Incentive Stock Plan will be made by the
board of directors of Reorganized CRC, or a committee thereof, in its sole
discretion, subject to the eligibility requirements under such plan. Shares
awarded under the Employee Incentive Stock Plan will be
57
"restricted securities" and therefore may not be resold in the absence of an
effective registration under the Securities Act or an exemption from such
registration.
D. NEW EQUITY SUMMARY
In summary, the New Common Stock will be distributed as follows:
TABLE 14: SUMMARY OF NEW EQUITY
NUMBER OF SHARES DISPOSITION
- ---------------- -----------
4,000,000 Sold to Investors
615,385 Issued to employees under the Chapter 11 Stock Plan
615,385 Set aside for Bank Group Warrants
923,077 Set aside for Class 3 Warrants
323,887 Set aside for future options under the Employee Incentive Stock Plan
6,477,734 Total
4. Corporate Structure and Governance
A. MERGER OR CHARTER
On or before the Effective Date, CRG and SCLP will either be merged
into CRC or will be dissolved, with the assets of these entities to be
liquidated and/or distributed to CRC. The Plan and Disclosure Statement assumes
that the Debtors will be legally consolidated on or before the Effective Date.
As of the Effective Date, and subject to such charter amendments as may be made
pursuant to the Plan, the articles of incorporation of Reorganized CRC will be
the same as the articles of incorporation of CRC immediately before the
Effective Date and the bylaws of Reorganized CRC will be the same as the bylaws
of CRC immediately before the Effective Date. Effective as of the Effective
Date, the officers and directors of Reorganized CRC will be the same as the
officers and directors of CRC immediately before the Effective Date. Charter
amendments that may be made pursuant to the plan, include changes as may be
necessary or appropriate (a) to
58
conform such instruments to recent amendments to corporation statutes, (b) in
accordance with the Plan and Reorganized CRC's status as a privately held
company, and (c) to include a prohibition on the issuance of non-voting equity
securities.
B. COMPOSITION OF REORGANIZED DEBTORS' BOARD OF
DIRECTORS AND IDENTITY AND COMPENSATION OF OFFICERS.
Set forth below is a description of compensation expected to be
provided to the directors and officers of the Reorganized Debtors during its
2002 and 2003 fiscal years.(13)
TABLE 15: MANAGEMENT COMPENSATION SUMMARY (2002-2003)
2002 2003
NAME POSITION COMPENSATION(14) COMPENSATION
- ---- -------- ---------------- ------------
Henry Hillenmeyer Chief Executive Officer Chairman $245,000 $255,000
of the Board of Directors Director
Daniel Clay Executive Vice President Chief $262,300 $272,800
Operating Officer Director
David McDaniel Vice President $ 64,558 $ 67,000
Linda DeVault Secretary $ 57,500 $ 60,000
Robin B. Holderman Director(15) $ 12,800 $ 12,800
David T. Kollat Director*** $ 12,800 $ 12,800
D. Shannon LeRoy Director*** $ 12,800 $ 12,800
Harvey N. Palash Director*** $ 12,800 $ 12,800
Brad Saltz Director*** $ 12,800 $ 12,800
5. Employee Incentive Plan/Stock Option Plan
In addition, shares of New Common Stock shall be issued or reserved for
issuance to management and employees of the Debtors or Reorganized CRC, as
follows: (a) 615,385 shares, amounting to ten percent (10%) of Reorganized CRC
before giving effect to the issuance of shares under the Employee Incentive
Stock Plan, shall be issued at the discretion of the Board of
- ------------------
(13) The compensation of officers is subject to modification both pre and
post-confirmation.
(14) Officer Compensation for 2002 and 2003 does not include any performance
bonuses that may be offered and earned.
(15) ***Non-management directors receive $2,200 per quarter plus $500 per board
or committee meeting. Outside directors were not actually paid the full annual
rate of $12,800.00 per annum in year 2001.
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Directors to the Debtors' employees in consideration for the additional work
performed during the chapter 11 cases (the "Chapter 11 Stock Plan") and (b)
323,887 shares, amounting to five percent (5%) of Reorganized CRC after giving
effect to the issuance of all shares of New Common Stock authorized under the
Plan to be issued or reserved (including shares offered and sold in the Investor
Offering, issued or reserved under the Chapter 11 Stock Plan, or reserved for
issuance upon exercise of New Warrants), shall be set aside for an incentive
stock option plan to be used in the future to attract key employees and reward
performance (the "Employee Incentive Stock Plan").
6. Executive Bonuses
In addition, upon Confirmation of the Plan, Officers will be eligible
for bonuses, which aggregate $100,000 (the "Confirmation Bonuses"), as
distributed by the Board of Directors. Under the bonus plans in place prior to
Chapter 11, the Officers would have received bonuses in excess of $500,000 in
the period from Petition Date to the Effective Date, but in view of the Debtors'
severe cash situation, they elected to forego bonuses during these Chapter 11
cases.
7. Estate Representative
The Reorganized Debtors shall be appointed the Estate Representative
for purposes of prosecuting any Rights of Action, objecting to Claims,
disbursing monies to Holders of Claims and Interests under the Plan, liquidating
remaining property of the Estates and administering the Reserves established
pursuant to the Plan (other than the Seelbinder Litigation and the Preference
Actions which shall be assigned to the Committee and the Class 3(a), (b) and (c)
Creditors).
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Without further order of the Court, the Reorganized Debtors may employ
professionals, including counsel and accountants, the duties of which may
include, without limitation, assisting in fulfilling the obligations under the
Plan, including prosecuting any Rights of Action, objecting to Claims, filing
tax returns and disposing of the remaining assets of the Estates. Such
professionals shall be entitled to receive compensation for services rendered
after the Effective Date without further order of the Court.
The Reorganized Debtors may pursue or decline to pursue any Rights of
Action, as it deems appropriate in its sole discretion. Reorganized Debtors may
settle, release, sell, and assign, otherwise transfer or compromise such Rights
of Action. Similarly, Reorganized Debtors may sell any remaining assets of
Reorganized Debtors in their sole discretion.
Reorganized Debtors may, but shall not be required to, set-off against
any Claim and the Distributions to be made pursuant to the Plan in respect of
such Claim, any claims the Estates may have against the holder of the Claim, but
neither the failure to do so nor the allowance of any Claim hereunder shall
constitute a waiver or release by Reorganized Debtors of any such claims,
set-off or recoupment rights which Reorganized Debtors may have against such
Holder.
Unless a claim against a creditor or other person is expressly waived,
relinquished, compromised or settled in the Plan or in a Final Order, all rights
with respect to such claim are reserved to Reorganized Debtors, which may pursue
such claim. Upon the substantial consummation of the Plan, the Reorganized
Debtors may file, and after full consummation shall file, a report with the
Court and request the entry of a final decree closing these Cases.
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8. Disputed Claims and Unclaimed Property
Notwithstanding all references in the Plan to Claims that are Allowed,
in undertaking the calculations concerning Allowed Claims or Allowed Interests
or Administrative Claims under the Plan, including the determination of the
amount of Distributions due to the Holders of Allowed Claims and Administrative
Claims, each Disputed Claim shall be treated as if it were an Allowed Claim or
authorized Administrative Claim, as appropriate, except that if the Court
estimates the likely portion of a Disputed Claim to be Allowed or otherwise
determines the amount which would constitute a sufficient reserve for a Disputed
Claim (which estimates and determinations may be requested by the Debtors or
Reorganized Debtors), such amount as determined by the Court shall be used as to
such Claim.
The Distributions due in respect of Disputed Claims based on the
calculations required by the Plan shall be reserved for the Holders of the
Disputed Claims and deposited in a segregated account (the "Disputed Claims
Reserve"). The amount so deposited on behalf of a Creditor holding a particular
Disputed Claim is referred to herein as the "Reserve Amount."
After an objection to a Disputed Claim is withdrawn or determined by
Final Order, the Distributions due on account of any resulting Allowed Claim or
authorized Administrative Expense shall be paid by Reorganized CRC from the
Reserve Amounts for such Creditor held in the Disputed Claims Reserves together
with the interest, if any, actually accrued on the Reserve Amounts (up to a
maximum of the interest actually accrued on the amount of the resulting Allowed
Claim or authorized Administrative Claim). Such payment shall be made on the
earlier
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of (a) the next payment date for Claims or Administrative Expenses of the Class
or type of the Claim or Administrative Expense of such Holder and, (b) within
forty-five (45) days of the date the Disputed Claim becomes an Allowed Claim or
authorized Administrative Expense. No interest shall be due to a Disputed Claim
holder based on the delay attendant to determining the allowance of such Claim
except as set forth in this subsection.
Should the Distribution due in respect of a finally Allowed Claim of
such creditor exceed the Reserve Amount for Administrative Claims, Secured
Claims or Priority Claims, the shortfall may be paid from any available sums of
Reorganized CRC and, for Unsecured Claims, the shortfall may be paid from funds,
if any, otherwise available to distribute to Unsecured Claims, collectively. In
no event shall the Creditor have recourse to any payments already made to
others.
After an objection to such a Disputed Claim is sustained in whole or in
part by a Final Order, any Reserve Amounts for such Claim held in the Disputed
Claims Reserve in excess of the Distributions due on account of any resulting
Allowed Claim may be removed from the Disputed Claims Reserve and put in
Reorganized CRC's general accounts, with the exception of amounts resulting from
objections to Class 3(a)-Class 3(c) Claims, which funds shall be held for
distribution to Holders of Allowed Class 3(a)-Class 3(c) Claims on the
Semi-Annual Payment Dates.
Any Cash or other property which is unclaimed for one hundred and
eighty (180) days after the Distribution is sent by mail to the last known
mailing address for the person entitled thereto as provided in the Plan
("Unclaimed Property") will be deemed paid to such entitled
63
Person, for purposes of determining the Person's rights. Any Person that does
not claim its Distribution within one hundred and eighty (180) days will not
receive that unclaimed distribution, but may receive future distributions under
the Plan. Unclaimed Property resulting from a Distribution shall revest in
Reorganized CRC. On the 90th day after the Distribution, the Debtors shall file
with the Court (and serve on the Committee) an Unclaimed Property schedule,
which sets forth a list of all unclaimed Distributions.
G. CLAIM OBJECTION BAR DATE
The Debtors, creditors and other parties in interest shall have until
120 days following the Effective Date of the Plan (the "Claim Objection Bar
Date") to file all objections to claims and/or interests in these cases.
III.
TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES
A. EXECUTORY CONTRACTS AND UNEXPIRED LEASES TO BE ASSUMED
Attached to the Disclosure Statement as EXHIBIT Q is a chart, which
identifies the Debtors' unexpired leases and executory contracts to be assumed
(the "Assumed Leases") as obligations of Reorganized CRC under this Plan on the
Effective Date. EXHIBIT Q also itemizes the amount of monetary defaults, if any,
which exist under such leases and executory contracts, which the Debtors must
cure pursuant to section 365(b) of the Bankruptcy Code. The Confirmation Order
shall constitute an Order approving the assumption of each lease and contract
listed. If you are a party to a lease or contract to be assumed and you object
to the assumption of
64
your lease or contract and/or you object to the amount that the Debtors have set
forth on EXHIBIT Q as owing to cure monetary defaults, you must file and serve
your objection to the Plan within the deadline for objecting to the confirmation
of the Plan. See Section I (Introduction) of the Disclosure Statement for the
specific date.(16)
B. OTHER EXECUTORY CONTRACTS AND UNEXPIRED LEASES TO BE REJECTED
Attached to the Disclosure Statement as EXHIBIT R is a chart, which
identifies additional unexpired leases and executory contracts the Debtors will
reject as of the Effective Date. The Confirmation Order shall constitute an
Order approving the rejection of each lease and contract listed. If you are a
party to a contract or lease to be rejected and you object to the rejection of
your contract or lease, you must file and serve your objection to the Plan
within the deadline for objecting to the confirmation of the Plan. See Section I
(Introduction) of the Disclosure Statement document for the specific date.
THE BAR DATE FOR FILING A PROOF OF CLAIM BASED ON A CLAIM ARISING FROM
THE REJECTION OF A LEASE OR CONTRACT IS THIRTY (30) CALENDAR DAYS FROM THE DATE
THE CONFIRMATION ORDER IS ENTERED ON THE COURT'S DOCKET. Any Claim based on the
rejection of a contract or lease will be barred if the proof of Claim is not
timely filed.
- ------------------
(16) The Debtors reserve the rights to add or withdraw any contract from the
Assumption or Rejection Schedules at any time prior to the confirmation hearing.
65
IV.
TREATMENT OF MISCELLANEOUS ITEMS
A. ROUNDING OF AMOUNTS/DE MINIMIS AMOUNTS
Notwithstanding anything to the contrary in the Plan, the Debtors may
round all amounts for Distributions of Cash hereunder to Holders of Allowed
Claims and Interests to the nearest whole dollar amount. In addition, the
Debtors shall not be required to make a Distribution on account of any Claim
until the Distribution to such creditor totals a minimum of $5.00.
B. NAME AND ADDRESS OF HOLDER
For purposes of all Distributions under this Plan, the Debtors will be
entitled to rely on the name and address of the Holder of each Allowed Claim or
Interest as shown on any timely filed proof of Claim and, if none, as shown on
the Debtors' schedules, as amended, as of the date of the hearing on
Confirmation of the Plan, except to the extent that both the Debtors and their
counsel first receive adequate written notice of a transfer or change of
address, properly executed by the Holder or its authorized agent.
C. APPLICATION OF PAYMENTS
All Distributions in respect of Allowed Claims will be allocated first
to the principal amount of the Allowed Claim, with any excess allocated to
unpaid accrued interest.
D. ORDERS TO AID CONSUMMATION OF PLAN
The Plan constitutes and incorporates a motion under 11 U.S.C. ss. 1142
and the Federal Rules of Bankruptcy Procedure 7069 and 7070 for an order to
cause the Debtors and all their
66
present and former directors, officers, agents, employees, attorneys, and
accountants to cooperate fully in providing the Debtors with all information
regarding and access to properties and Assets of the Debtors and its Estates;
and to execute and deliver such documents and perform such acts as are
reasonably necessary to enable the Debtors to take possession, custody, and
control of all assets vested in the Debtors' Estates pursuant to the Plan to the
extent provided for under the Plan and reasonably necessary to transfer all of
the assets of the Debtors to Reorganized CRC and the cancellation of all other
issued and outstanding shares in CRC and partnership interests in SCLP.
Confirmation of the Plan shall be deemed a granting of such motion and the
Confirmation Order shall be deemed the order thereon.
E. SEVERABILITY
If the Court determines, prior to the date of entry of the Confirmation
Order, that any provision of the Plan is illegal either as written or as applied
to any Claim or Interest, as the case may be, such provision shall be either
unenforceable generally or as applied to such Claim or Interest. A determination
that a provision of the Plan is illegal or not enforceable as to a particular
Claim or Interest shall in no way limit or affect the enforceability and
operative effect of any other provision of the Plan or of that provision as
applied to other Claims or Interests and the Debtors may modify the Plan to
withdraw or modify such provision.
F. HEADINGS OF ARTICLES AND SECTIONS
The headings of the articles and sections of the Plan are inserted for
convenience only and shall in no way affect the interpretation of its
provisions.
67
G. SUCCESSORS AND ASSIGNS
The rights, benefits and obligations of any entity referred to in the
Plan shall be binding on, and shall inure to the benefit of, the heirs,
executors, administrators, successors or assigns of such entity.
H. CHANGES IN RATES SUBJECT TO REGULATORY COMMISSION APPROVAL
The Debtors are not subject to governmental regulatory commission
approval of their prices.
I. SERVICES BY AND FEES FOR PROFESSIONALS
1. Prior to the Effective Date
The Plan provides that fees and expenses for the professionals retained
by the Committee or the Debtors for services rendered and costs incurred after
the Petition Date and prior to the Effective Date, will be fixed by the
Bankruptcy Court after notice and a hearing and such fees and expenses will be
paid (less deductions for any and all amounts thereof already paid to such
Persons) after approval by the Bankruptcy Court to the extent so approved and as
provided in the Plan.
2. From the Effective Date
Fees owing for services rendered and costs incurred and owing on and
after the Effective Date by the Professionals retained by the Debtors will be
paid by Reorganized CRC from the funds held by Reorganized CRC twenty (20) days
after submission of a bill therefore to the Reorganized CRC, if there is no
objection within such time. If there is such an objection, the fees
68
and expenses will be fixed by the Bankruptcy Court after notice and a hearing.
The Bankruptcy Court will retain jurisdiction until the Case is closed, to
determine disputed post-Effective Date fees of Reorganized CRC professionals.
J. CONTINUATION OF THE COMMITTEE
Pursuant to the Plan, the Committee shall not be dissolved upon
Confirmation. However, as of the Effective Date, the Committee and each of its
members shall be released and discharged from all duties and obligations arising
from or related to the Cases, except those specifically reserved to the
Committee under the terms of the Plan. Following the Effective Date, the
Committees' fees and expenses shall be paid first from the Litigation Reserves
until exhausted and then, upon Committee authorization, from any Litigation
Proceeds until exhausted and then from any other Distributions to Class 3
Creditors. The Debtors shall have no liability for any post-Confirmation fees
and/or expenses other than the Litigation Reserves. Following the Effective
Date, the Committee may reconstitute itself to reduce the number of its members
or otherwise change its membership, in its sole discretion. Notice of any such
reconstitution shall be provided to Reorganized CRC.
Subject to further order of the Bankruptcy Court, the Committee shall
be dissolved effective as of the date of final distribution of all cash
payments to be made to the holders of the Class 3 Claims under the Plan.
69
K. AMENDMENT, WITHDRAWAL OR REVOCATION OF THE PLAN
The Debtors reserve the right to amend, revoke or withdraw the Plan
prior to the Confirmation Date. If the Debtors should revoke or withdraw the
Plan, then the Plan shall be null and void, and nothing contained in the Plan
shall constitute a waiver or release of any Claims by or against, or any
Interests in the Debtors, or prejudice in any manner the rights of Debtors.
L. RETENTION OF JURISDICTION
The Bankruptcy Court will retain and have exclusive jurisdiction over
any matter (a) arising under the Bankruptcy Code, (b) arising in or related to
the chapter 11 cases or the Plan, or (c) that relates to the following:
a. Resolution of any matters related to the assumption,
assumption and assignment, or rejection of any executory contract or unexpired
lease to which the Debtors are a party or with respect to which the Debtors may
be liable and to hear, determine and, if necessary, liquidate, any Claims
arising therefrom, including those matters related to the amendment after the
Effective Date of the Plan, to add any executory contracts or unexpired leases
to the list of executory contracts and unexpired leases to be rejected;
b. Entry of such orders as may be necessary or
appropriate to implement or consummate the provisions of the Plan and all
contracts, instruments, releases, and other agreements or documents created in
connection with the Plan;
70
c. Determination of any and all motions, adversary
proceedings, applications, and contested or litigated matters that may be
pending on the Effective Date or that, pursuant to the Plan, may be instituted
by the Reorganized CRC after the Effective Date;
d. Ensuring that distributions to holders of Allowed
Claims are accomplished as provided in the Plan;
e. Hearing and determining any timely objections to
Administrative Expense Claims or to proofs of Claim filed, both before and after
the Confirmation Date, including any objections to the classification of any
Claim and to allow, disallow, determine, liquidate, classify, estimate, or
establish the priority of secured or unsecured status of any Claim, in whole or
in part;
f. Entry and implementation of such orders as may be
appropriate in the event the Confirmation Order is for any reason stayed,
revoked, modified, reversed, or vacated;
g. Issuance of such orders in aid of execution of the
Plan, to the extent authorized by section 1142 of the Bankruptcy Code;
h. Consideration of any modifications of the Plan, to
cure any defect or omission, or reconcile any inconsistency in any order of the
Bankruptcy Court, including the Confirmation Order;
i. Hearing and determining all applications for awards
of compensation for services rendered and reimbursement of expenses incurred
prior to the Confirmation Date;
71
j. Hearing and determining disputes arising in
connection with or relating to the Plan or the interpretation, implementation,
or enforcement of the Plan or the extent of any Entity's obligations incurred in
connection with or released or exculpated under the Plan;
k. Issuance of injunctions or other orders as may be
necessary or appropriate to restrain interference by any Entity with
consummation or enforcement of the Plan;
l. Determination of any other matters that may arise in
connection with or are related to the Plan, the Disclosure Statement, the
Confirmation Order or any contract, instrument release, or other agreement or
document created in connection with the Plan or the Disclosure Statement;
m. Hearing and determining matters concerning state,
local, and federal taxes (including but not limited to the Tax Refund) in
accordance with sections 346, 505, and 1146 of the Bankruptcy Code;
n. Hearing any other matter or for any purpose specified
in the Confirmation Order that is not inconsistent with the Bankruptcy Code; and
o. Entry of a final decree closing the chapter 11 cases.
M. CONFIRMATION REQUEST
In the event that all of the applicable requirements of 11
U.S.C.ss.1129(a) are met other than paragraph (8), the Debtors requests
confirmation of the Plan notwithstanding the requirements of such paragraph
under 11 U.S.C.ss.1129(b).
72
V.
CONDITIONS TO EFFECTIVENESS OF THE PLAN
Confirmation of the Plan is conditioned upon the events described
below:
1. The Debtors' receipt of $4 million in equity financing from the sale of
New Common Stock.
2. The Debtors' execution of all Plan Agreements required to be executed
by Debtors.
VI.
EFFECT OF CONFIRMATION OF PLAN
A. BINDING EFFECT OF CONFIRMATION.
Confirmation will bind the Debtors, all Creditors, Interest Holders and
other parties in interest to the provisions of the Plan whether or not the Claim
or Interest of such Creditor or Interest Holder is impaired under the Plan and
whether or not such Creditor or Interest Holder has accepted the Plan.
B. VESTING OF ASSETS FREE AND CLEAR OF LIENS, CLAIMS AND INTERESTS
Except as otherwise provided in the Plan or in the Confirmation Order,
upon the Effective Date, title to all Assets and property of the Debtors, and
all property of the Estate, including, pursuant to section 1123(b)(3)(b) of the
Bankruptcy Code, each and every claim, demand or cause of action which the
Debtor had or had power to assert immediately prior to Confirmation, will revest
in Reorganized CRC, free and clear of all liens, Claims and Interests.
Thereafter, Reorganized CRC will hold these assets without further jurisdiction,
restriction or supervision of
73
the Bankruptcy Court. In addition, the Confirmation Order will serve to
discharge and terminate the audit rights, if any, of the IRS and/or any other
applicable authority with respect to the Tax Refund and the Adjusted Tax Refund.
C. GOOD FAITH
Confirmation of the Plan shall constitute a finding that: (i) this Plan
has been proposed in good faith and in compliance with applicable provisions of
the Bankruptcy Code; and (ii) the solicitation of acceptances or rejections of
this Plan by all Persons and the offer, issuance, sale, or purchase, of a
security offered or sold under the Plan has been in good faith and in compliance
with applicable provisions of the Bankruptcy Code. Accordingly, on the Effective
Date each of the officers and directors of the Debtors, the members of the
Committee, and each of their respective advisors and attorneys, effective as of
the Effective Date, will be deemed exculpated by Holders of Claims against and
Interests in the Debtors and other parties in interest to the Cases (including,
without limitation, the Debtors), from any and all claims, causes of action and
other assertions of liability (including, without limitation, breach of
fiduciary duty), arising out of or related to the Debtors, the Committee, the
Cases or the exercise by such entities of their functions as members of or
advisors to or attorneys for any such individuals or committee or otherwise
under applicable law, in connection with or related to the Cases, including
without limitation, the formulation, negotiation, preparation, dissemination,
Confirmation and consummation of this Plan and any agreement, instrument or
other document issued hereunder or related hereto; provided, however, that
neither the Plan nor Confirmation shall have any effect on liability for
74
any act or omission of the officers and directors of the Debtors, the members of
the Committee, and each of their respective advisors and attorneys to the extent
that such act or omission is ultra vires or constitutes gross negligence or
willful misconduct.
D. NO LIMITATIONS ON EFFECT OF CONFIRMATION
Nothing contained in the Plan will limit the effect of Confirmation as
described in section 1141 of the Bankruptcy Code.
E. DISCHARGE OF CLAIMS
The rights afforded under the Plan and the treatment of Claims under
the Plan will be in exchange for and in complete satisfaction, discharge, and
release of all Claims. Confirmation of the Plan shall discharge Debtor from all
Claims that arose before the Confirmation Date and all Claims of all kinds
specified in sections 502(g), (h) and (i) of the Bankruptcy Code, whether or not
a proof of Claim is filed or deemed filed, and whether or not a Creditor has
accepted the Plan. However, any liability imposed by the Plan will not be
discharged.
F. JUDICIAL DETERMINATION OF DISCHARGE
As of the Confirmation Date, except as provided in the Plan, all
Persons shall be precluded from asserting against the Debtors any other or
further Claims, debts, rights, causes of action, liabilities, including but not
limited to the rights, if any, related to audit rights by the IRS or other
applicable authorities with respect to the Tax Refund and/or the Adjusted Tax
Refund, or equity interests based on any act, omission, transaction or other
activity of any kind or nature that occurred before the Confirmation Date, and
the Confirmation Order shall be a judicial
75
determination of discharge of all Claims against the Debtors pursuant to
sections 524 and 1141 of the Bankruptcy Code, and shall void any judgment
obtained or entered against Debtors at any time, to the extent the judgment
relates to discharged Claims.
G. INJUNCTION
As of the Confirmation Date, all Persons that have held, currently hold
or may hold a Claim or other debt or liability that is discharged or an Interest
or other right of an equity security holder that is terminated pursuant to the
Plan are permanently enjoined from taking any of the following actions on
account of such discharged Claims, debts, or liabilities or terminated Interests
or rights: (a) commencing or continuing in any manner any action or other
proceeding against Debtors and/or their property or Reorganized CRC and/or its
property; (b) enforcing, attaching, collecting or recovering in any manner any
judgment, award, decree, or other against Debtors and/or their property or
Reorganized CRC and/or its property; (c) creating, perfecting or enforcing any
lien or encumbrance against Debtors and/or their property or Reorganized CRC
and/or its property; (d) asserting a right of subrogation or recoupment of any
kind against any debt, liability or obligation due to Debtors and/or their
property or Reorganized CRC and/or its property; and (e) commencing or
continuing any action that does not comply with or is inconsistent with the
provisions of the Plan.
H. SECURITIES LAWS
The entry of the Confirmation Order shall be (1) a final determination
of the Bankruptcy Court that the New Common Stock and New Warrants to be
distributed pursuant to this Plan are
76
entitled to all of the benefits and exemptions provided by section 1145 of the
Bankruptcy Code and (2) deemed to incorporate the following as mixed findings of
fact and conclusions of law:
1. Initial Offer and Sale Exempt from Registration.
Section 5 of the Securities Act and any State or local law requiring
registration for the offer or sale of a security or registration or licensing of
an issuer of, underwriter of, or broker or dealer in, a security, do not apply
to (a) the offer or sale of any New Common Stock or any New Warrants in
accordance with the Plan or (b) the offer of any New Common Stock through, or
the sale of any New Common Stock upon the exercise of, any New Warrants offered
or sold in accordance with the Plan.
2. For Resale Purposes, Initial Offering Deemed Public Offering.
The offer or sale of the New Common Stock and New Warrants in
accordance with the Plan (including, without limitation, any New Common Stock
offered through or sold upon exercise of any New Warrants) is deemed to be a
public offering. Accordingly, such securities shall be deemed not to be
"restricted securities" within the meaning of the Securities Act and may be
resold without registration under the Securities Act by any holder not deemed
under 11 U.S.C. ss. 1145(b) to be an underwriter with respect to such
securities.
3. Creditor Trust Matters.
The Creditor Trust, in reliance upon the exemption afforded by 11
U.S.C. 1145(a), is entitled to issue beneficial interests to its beneficiaries
in accordance with the Plan without registration under the Securities Act.
Beneficial interests in the Creditor Trust are not "equity
77
securities" within the meaning of the Exchange Act and the Creditor Trust is
entitled to issue beneficial interests to its beneficiaries and distribute the
Class 3 Warrants (or New Common Stock issued upon exercise thereof) in
accordance with the Plan without registration of such interests under such act.
Beneficial interests in the Creditor Trust are not "evidences of indebtedness"
within the meaning of the Trust Indenture Act of 1939, as amended, and the
Creditor Trust is entitled to issue beneficial interests to its beneficiaries in
accordance with the Plan other than pursuant to an indenture qualified under
such act. The Creditor Trust, in reliance upon the exception for transactions
that are merely incidental to the dissolution of an investment company, is
entitled to conduct its activities in accordance with the Plan without
registration under the Investment Company Act of 1940, as amended.
I. MODIFICATION OF PLAN
The Proponent of the Plan may modify the Plan at any time before
confirmation. However, the Court may require a new disclosure statement and/or
revoting on the Plan if proponent modifies the plan before confirmation. The
Proponent of the Plan may also seek to modify the Plan at any time after
confirmation so long as (1) the Plan has not been substantially consummated and
(2) if the Court authorizes the proposed modifications after notice and a
hearing.
78
J. POST-CONFIRMATION CONVERSION/DISMISSAL
In addition to all other rights available in law of equity, a creditor
or party in interest may bring a motion to convert or dismiss the case under
ss.1112(b), after the Plan is confirmed, if there is a default in performing the
Plan.
K. FINAL DECREE
Once the estate has been fully administered as referred to in
Bankruptcy Rule 3022, the Plan Proponent, or other party as the Court shall
designate in the Plan Confirmation Order, shall file a motion with the Court to
obtain a final decree to close the case.
Dated: July __, 2002 COOKER RESTAURANT CORPORATION
SOUTHERN COOKER LIMITED
PARTNERSHIP
CGR MANAGEMENT CORPORATION
-------------------------------
By: Henry Hillenmeyer
Their: Chief Executive Officer
79
SUMMARY OF EXHIBITS
EXHIBIT DESCRIPTION
------- -----------
1 Definitions
2 CIT Tranche A FFE
3 CIT Tranche B FF&E
4 Tranche A Leased Properties
5 Tranche A Owned Properties
6 Tranche B Owned Properties
80
TABLE OF CONTENTS
PAGE
I. INTRODUCTION......................................................................................1
II. CLASSIFICATION AND TREATMENT OF CLAIMS AND INTERESTS..............................................3
A. What Creditors and Interest Holders Will Receive Under The Plan.................................3
B. Substantive Consolidation.......................................................................3
C. Unclassified Claims.............................................................................5
1. Administrative Expenses................................................................5
a. Administrative Claims of Non-Professionals....................................5
b. Administrative Claims of Professionals........................................7
c. Administrative Real and Personal Property Tax Claims..........................9
d. Administrative Bar Date for Filing of Administrative Claims...................9
(1) Bar Date for Administrative Tax Claims................................9
(2) Bar Dates for All Other Administrative Claims........................10
2. Priority Tax Claims...................................................................11
D. Classified Claims and Interests................................................................12
1. Summary of Classification under the Debtors' Plan.....................................12
2. Classes of Secured Claims.............................................................12
3. Class 1(a): Secured Claim of the Bank Group:..........................................12
a. General......................................................................13
b. The Bank Group Allowed Tranche A Claim.......................................13
(1) Amount...............................................................13
(2) Maturity Date, Interest Rate and Amortization........................13
(3) Payments.............................................................14
(4) Security.............................................................14
(5) Real Property Taxes..................................................15
(6) Insurance............................................................16
c. The Tranche B Claim..........................................................16
(1) Amount...............................................................16
(2) Interest.............................................................17
(3) Non-Recourse.........................................................17
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(4) Payments.............................................................17
(a) Payments Already Made on Account of Tranche B Claim.........17
(b) Pre-Effective Date Payments on Account of
Tranche B Claim.............................................17
(c) Tranche B Net Proceeds......................................19
(5) Security.............................................................20
(6) Deed In Lieu Option..................................................20
d. The Bank Group General Unsecured Claim ......................................21
e. Warrants.....................................................................22
(1) Amount...............................................................22
(2) Exercise and Strike Price............................................22
(3) Redemption of Warrants...............................................23
(4) Bank Group Warrant Agreement.........................................24
f. Miscellaneous................................................................25
(1) Cost of Documentation................................................25
(2) Mutual Releases......................................................25
(3) Capital Expenditure Budget...........................................26
(4) Restrictions.........................................................26
(5) Balance Sheet Liabilities............................................26
(6) Waiver of Right to Block Distributions to
Bondholder General Unsecured Claims..................................26
4. Class 1(b): Allowed Secured Claim of CIT..............................................27
a. General......................................................................27
b. The CIT Tranche A Claim......................................................27
(1) Amount...............................................................27
(2) Maturity Date, Interest Rate and Amortization........................27
(3) Payment..............................................................28
(a) Cash Payment on Effective Date..............................28
(b) Interest Only Payments through January 2, 2003..............28
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(c) Principal and Interest Payments through January 1, 2008.....28
(d) The Class 3(b) Bondholder Payment...........................28
(4) Security.............................................................29
(5) Release Prices.......................................................29
c. The CIT Tranche B Claim......................................................29
(2) Interest.............................................................29
(3) Non-Recourse.........................................................30
(4) Security.............................................................30
(5) Payments.............................................................30
(a) Pre-Effective Date Payments on Account of
CIT Tranche B Claim.........................................30
(b) Payments Upon Sale of CIT Tranche B
Property (or a CIT Tranche A Property which
is closed before a sale within 24 months of
the Effective Date).........................................31
d. CIT General Unsecured Claim..................................................31
e. Miscellaneous................................................................32
(1) Kennesaw and Gwinett.................................................32
(2) Sale of FF&E at Locations Where the Real Property
Lease Has Been Rejected..............................................32
(3) Mutual Releases......................................................33
(4) Warrants.............................................................33
(5) Store 110 (Nashville)................................................33
5. Class 1(c): Secured Real Property Tax Claims..........................................33
6. Class 1(d): PACA Claims...............................................................34
7. Class 1(e): Reclamation Claims.......................................................34
8. Class 1(f): Secured Personal Property Tax Claims......................................35
9. Class 1(g): Subordinate Secured Real Property Claims..................................36
10. Class of Priority Non-Tax Claims......................................................36
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11. Classes of Unsecured Claims...........................................................38
a. Classes 3(a)-3(c)............................................................38
(1) Class 3 Available Distributable Cash.................................38
(a) Class 3(a) Share............................................39
(b) Class 3(b) Share............................................40
(c) Class 3(c) Share............................................41
(d) Timing of the Payments......................................42
(i) Initial Cash Payment of Class 3
Available Distributable Cash.......................42
(ii) Remaining Cash Payment of Class 3
Available Distributable Cash.......................42
(iii) No Payments on Class 3(c)..........................43
(2) Warrants.............................................................43
(a) General.....................................................43
(b) Exercise and Strike Price...................................44
(c) Trust for Class 3 Warrants..................................45
(d) Indenture Trustee Fees......................................47
(e) Creditor Trust Agreement....................................47
(3) Litigation Proceeds..................................................48
(a) Claims Against Arthur Seelbinder............................48
(b) Preference Actions..........................................48
(c) Timing of Payments..........................................49
(d) Attorneys Fees and Costs....................................50
(e) Delivery of Financial Statements............................50
(f) Rule 144 Reporting..........................................51
E. Class(es) of Interest Holders..................................................................51
F. Means of Effectuating the Plan.................................................................52
1. Funding for the Plan..................................................................52
a. Cash Needs on the Effective Date.............................................52
2. Sources of Cash on the Effective Date.................................................52
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3. Equity Capital........................................................................53
a. Shares of Reorganized CRC....................................................53
b. New Warrants.................................................................56
c. New Common Stock under Employee Incentive Stock Plan.........................57
d. New Equity Summary...........................................................58
4. Corporate Structure and Governance....................................................58
a. Merger or Charter............................................................58
b. Composition Of Reorganized Debtors' Board Of Directors
And Identity And Compensation Of Officers....................................59
5. Employee Incentive Plan/Stock Option Plan.............................................59
6. Executive Bonuses.....................................................................60
7. Estate Representative.................................................................60
8. Disputed Claims and Unclaimed Property................................................62
G. Claim Objection Bar Date.......................................................................64
III. TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES............................................64
A. Executory Contracts and Unexpired Leases to be Assumed.........................................64
B. Other Executory Contracts and Unexpired Leases to be Rejected..................................65
IV. TREATMENT OF MISCELLANEOUS ITEMS.................................................................66
A. Rounding of Amounts/De Minimis Amounts.........................................................66
B. Name and Address of Holder.....................................................................66
C. Application of Payments........................................................................66
D. Orders to Aid Consummation of Plan.............................................................66
E. Severability...................................................................................67
F. Headings of Articles and Sections..............................................................67
G. Successors and Assigns.........................................................................68
H. Changes in Rates Subject to Regulatory Commission Approval.....................................68
I. Services By And Fees For Professionals.........................................................68
1. Prior to the Effective Date...........................................................68
2. From the Effective Date...............................................................68
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J. Continuation of the Committee..................................................................69
K. Amendment, Withdrawal Or Revocation Of The Plan................................................70
L. Retention of Jurisdiction......................................................................70
M. Confirmation Request...........................................................................72
V. CONDITIONS TO EFFECTIVENESS OF THE PLAN..........................................................73
VI. EFFECT OF CONFIRMATION OF PLAN...................................................................73
A. Binding Effect Of Confirmation.................................................................73
B. Vesting of Assets Free and Clear of Liens, Claims and Interests................................73
C. Good Faith.....................................................................................74
D. No Limitations on Effect of Confirmation.......................................................75
E. Discharge of Claims............................................................................75
F. Judicial Determination of Discharge............................................................75
G. Injunction.....................................................................................76
H. Securities Laws................................................................................76
1. Initial Offer and Sale Exempt from Registration.......................................77
2. For Resale Purposes, Initial Offering Deemed Public Offering..........................77
3. Creditor Trust Matters................................................................77
I. Modification of Plan...........................................................................78
J. Post-Confirmation Conversion/Dismissal.........................................................79
K. Final Decree...................................................................................79
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TABLE 1: SUMMARY OF ADMINISTRATIVE CLAIMS OF NON-PROFESSIONALS........................6
TABLE 2: SUMMARY OF ADMINISTRATIVE CLAIMS OF PROFESSIONALS............................8
TABLE 3: SUMMARY OF PRIORITY TAX CLAIMS..............................................11
TABLE 4: SUMMARY OF CLASSIFICATION OF CLAIMS AND INTERESTS...........................12
TABLE 5: TREATMENT OF ALLOWED SECURED REAL PROPERTY TAX CLAIMS.......................34
TABLE 6: TREATMENT OF ALLOWED PACA CLAIMS............................................34
TABLE 7: TREATMENT OF ALLOWED RECLAMATION CLAIMS.....................................35
TABLE 8: TREATMENT OF ALLOWED SECURED PERSONAL PROPERTY TAX CLAIMS..................36
TABLE 9: TREATMENT OF ALLOWED SUBORDINATE REAL PROPERTY CLAIMS.......................36
TABLE 10: TREATMENT OF ALLOWED PRIORITY NON-TAX CLAIMS................................37
TABLE 11: SUMMARY OF CLASSIFICATION OF UNSECURED CLAIMS...............................38
TABLE 12: SUMMARY OF TREATMENT FOR INTEREST HOLDERS...................................51
TABLE 13: SUMMARY OF CASH NEEDS ON EFFECTIVE DATE.....................................52
TABLE 14: SUMMARY OF NEW EQUITY.......................................................58
TABLE 15: MANAGEMENT COMPENSATION SUMMARY (2002-2003).................................59
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