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EXHIBIT 99.2
UNITED STATES BANKRUPTCY COURT
DISTRICT OF DELAWARE
In re: Chapter 11
Case Nos. 99-450 (MFW) through
UNITED COMPANIES FINANCIAL 99-461 (MFW)
CORPORATION, ET AL., JOINTLY ADMINISTERED
Debtors.
FIRST AMENDED PLAN OF REORGANIZATION
FOR DEBTORS PURSUANT TO CHAPTER 11
OF THE UNITED STATES BANKRUPTCY CODE
WEIL, GOTSHAL & MANGES LLP RICHARDS, LAYTON & FINGER, P.A.
767 Fifth Avenue One Rodney Square
New York, New York 10153 Wilmington, Delaware 19899
(212) 310-8000 (302) 658-6541
Attorneys for Debtors and Attorneys for Debtors and
Debtors in Possession Debtors in Possession
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Article I DEFINITIONS....................................................................................1
1.1 Administrative Expense Claim...................................................................1
1.2 Adobe Financial................................................................................1
1.3 Adobe Financial Common Equity Interest.........................................................1
1.4 Adobe..........................................................................................1
1.5 Adobe Common Equity Interest...................................................................1
1.6 Affiliate......................................................................................1
1.7 Agent..........................................................................................1
1.8 Allowed Administrative Expense Claim...........................................................1
1.9 Allowed Claim/Allowed Equity Interest..........................................................1
1.10 Allowed Bank Claim.............................................................................1
1.11 Allowed Borrower Litigation Claim..............................................................2
1.12 Allowed Convenience Claim......................................................................2
1.13 Allowed General Unsecured Claim................................................................2
1.14 Allowed Lending Subordinated Debenture Claim...................................................2
1.15 Allowed Pride Equity Interest..................................................................2
1.16 Allowed Priority Non-Tax Claim.................................................................2
1.17 Allowed Priority Tax Claim.....................................................................2
1.18 Allowed Secured Claim..........................................................................2
1.19 Allowed Senior Claim...........................................................................2
1.20 Allowed Statutorily Subordinated Claim.........................................................2
1.21 Allowed Subordinated Debenture Claim...........................................................2
1.22 Ballot.........................................................................................2
1.23 Bank Cash Amount...............................................................................2
1.24 Bank Claims....................................................................................2
1.25 Bankruptcy Code................................................................................2
1.26 Bankruptcy Court...............................................................................2
1.27 Bankruptcy Rules...............................................................................2
1.28 Banks..........................................................................................2
1.29 Biase Litigation...............................................................................3
1.30 Borrower Litigation Claim......................................................................3
1.31 Borrower Settlement Trust......................................................................3
1.32 Borrower Settlement Trust Agreement............................................................3
1.33 Business Day...................................................................................3
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1.34 Cash...........................................................................................3
1.35 Cash Equivalents...............................................................................3
1.36 Chapter 11 Cases...............................................................................3
1.37 Claim..........................................................................................3
1.38 Class..........................................................................................3
1.39 Class Actions..................................................................................3
1.40 Collateral.....................................................................................4
1.41 Common Equity Interest.........................................................................4
1.42 Confirmation Date..............................................................................4
1.43 Confirmation Hearing...........................................................................4
1.44 Confirmation Order.............................................................................4
1.45 Convenience Claim..............................................................................4
1.46 Credit Agreement...............................................................................4
1.47 Creditor.......................................................................................4
1.48 Creditor Cash..................................................................................4
1.49 Creditors' Committee...........................................................................4
1.50 Debtors........................................................................................4
1.51 Debtors in Possession..........................................................................4
1.52 Disbursement Account(s)........................................................................4
1.53 Disbursing Agent...............................................................................5
1.54 Disclosure Statement...........................................................................5
1.55 Disputed Claim; Disputed Equity Interest.......................................................5
1.56 Disputed Claim Amount..........................................................................5
1.57 Documentation Agent............................................................................5
1.58 Effective Date.................................................................................5
1.59 8.375% Notes...................................................................................5
1.60 Entity.........................................................................................5
1.61 Equity Committee...............................................................................5
1.62 Equity Interest................................................................................5
1.63 ESOP Action....................................................................................5
1.64 Final Order....................................................................................5
1.65 General Unsecured Claim........................................................................6
1.66 Ginger Mae.....................................................................................6
1.67 Ginger Mae Common Equity Interest..............................................................6
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1.68 Gopher Equity..................................................................................6
1.69 Gopher Equity Common Equity Interest...........................................................6
1.70 Guaranty.......................................................................................6
1.71 Intercompany Affiliate.........................................................................6
1.72 Intercompany Claims............................................................................6
1.73 IRC............................................................................................6
1.74 IRS............................................................................................6
1.75 Lending Subordinated Debentures................................................................6
1.76 Lending Subordinated Debenture Claim...........................................................6
1.77 Lending Subordinated Indenture.................................................................6
1.78 Lien...........................................................................................6
1.79 Litigation Trust...............................................................................6
1.80 Litigation Trustee.............................................................................6
1.81 Litigation Trust Agreement.....................................................................6
1.82 Litigation Trust Board.........................................................................6
1.83 Litigation Trust Claims........................................................................7
1.84 Litigation Trust Interests.....................................................................7
1.85 9.35% Notes....................................................................................7
1.86 Pelican........................................................................................7
1.87 Pelican Common Equity Interest.................................................................7
1.88 Person.........................................................................................7
1.89 Petition Date..................................................................................7
1.90 Plan...........................................................................................7
1.91 Plan Administration Agreement..................................................................7
1.92 Plan Administrator.............................................................................7
1.93 Plan Supplement................................................................................7
1.94 Pride Equity Interest..........................................................................7
1.95 Pride Prospectus...............................................................................7
1.96 Priority Non-Tax Claim.........................................................................7
1.97 Priority Tax Claim.............................................................................7
1.98 Proponents.....................................................................................8
1.99 Pro Rata Share.................................................................................8
1.100 Record Date....................................................................................8
1.101 Remaining Assets...............................................................................8
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1.102 Reorganized UC.................................................................................8
1.103 Reorganized UC By-laws.........................................................................8
1.104 Reorganized UC Certificate of Incorporation....................................................8
1.105 Reorganized UC Common Stock....................................................................8
1.106 Reorganized UC Subsidiaries:...................................................................8
1.107 Residual Agreement:............................................................................8
1.108 Sale Transaction...............................................................................8
1.109 Schedules......................................................................................8
1.110 Secured Claim..................................................................................8
1.111 Senior Creditor Cash...........................................................................9
1.112 Senior Indenture...............................................................................9
1.113 Senior Indenture Trustee.......................................................................9
1.114 Senior Note Cash Amount........................................................................9
1.115 Senior Note Claims.............................................................................9
1.116 Senior Notes...................................................................................9
1.117 7.7% Notes.....................................................................................9
1.118 Southern Mortgage..............................................................................9
1.119 Southern Mortgage Common Equity Interest.......................................................9
1.120 Statutorily Subordinated Claim.................................................................9
1.121 Subordinated Debenture Claim...................................................................9
1.122 Subordinated Debentures........................................................................9
1.123 Subordinated Indenture.........................................................................9
1.124 Subordinated Indenture Trustee.................................................................9
1.125 Transfer Date..................................................................................9
1.126 Unicor........................................................................................10
1.127 Unicor Common Equity Interest.................................................................10
1.128 United Companies..............................................................................10
1.129 United Companies Common Equity Interest.......................................................10
1.130 United Funding:...............................................................................10
1.131 United Funding Common Equity Interest.........................................................10
1.132 United Lending Corp...........................................................................10
1.133 United Lending Corp. Common Equity Interest...................................................10
1.134 United Lending Group..........................................................................10
1.135 United Lending Group Common Equity Interest...................................................10
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1.136 United Credit Card............................................................................10
1.137 United Credit Card Common Equity Interest.....................................................10
1.138 Unsecured Claim...............................................................................10
1.139 Whole Loan Agreement..........................................................................10
1.140 Other Definitions.............................................................................10
Article II COMPROMISE AND SETTLEMENT OF DISPUTES; SUBSTANTIVE
CONSOLIDATION OF DEBTORS; ASSUMPTION OF OBLIGATIONS UNDER
THE PLAN......................................................................................11
2.1 Compromise and Settlement.....................................................................11
2.2 Substantive Consolidation.....................................................................11
2.3 Cancellation of Intercompany Claims...........................................................11
Article III PROVISIONS FOR PAYMENT OF ADMINISTRATIVE EXPENSE CLAIMS AND
PRIORITY TAX CLAIMS...........................................................................11
3.1 Administrative Expense Claims.................................................................11
3.2 Professional Compensation and Reimbursement Claims............................................11
3.3 Payment of Priority Tax Claims................................................................11
Article IV CLASSIFICATION OF CLAIMS AND EQUITY INTERESTS.................................................12
Article V PROVISION FOR TREATMENT OF PRIORITY NON-TAX CLAIMS (CLASS 1)..................................13
5.1 Payment of Allowed Priority Non-Tax Claims....................................................13
5.2 Continuation of Employee Medical Benefits.....................................................13
Article VI PROVISION FOR TREATMENT OF SECURED CLAIMS (CLASS 2)...........................................13
6.1 Treatment of Secured Claims...................................................................13
Article VII PROVISION FOR TREATMENT OF BANK CLAIMS (CLASS 3)..............................................13
7.1 Allowance of Bank Claims......................................................................13
7.2 Treatment of Allowed Bank Claims..............................................................13
Article VIII PROVISION FOR TREATMENT OF SENIOR NOTE CLAIMS (CLASS 4).......................................13
8.1 Allowance of Senior Note Claims...............................................................13
8.2 Treatment of Allowed Senior Note Claims.......................................................13
8.3 Payments to be Made to Senior Indenture Trustee...............................................14
8.4 Closing of Transfer Ledgers for Senior Notes..................................................14
Article IX PROVISIONS FOR ALLOWANCE AND TREATMENT OF BORROWER
LITIGATION CLAIMS (CLASS 5)...................................................................14
9.1 Treatment of Borrower Litigation Claims.......................................................14
9.2 Mandatory Arbitration of Borrower Litigation Claims...........................................14
Article X PROVISION FOR TREATMENT OF GENERAL UNSECURED CLAIMS (CLASS 6).................................15
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10.1 Treatment of General Unsecured Claims.........................................................15
10.2 Allowed Claims of One Thousand Dollars or More................................................15
Article XI PROVISIONS FOR TREATMENT OF CONVENIENCE CLAIMS (CLASS 7)......................................15
11.1 Treatment of Convenience Claims...............................................................15
Article XII PROVISION FOR TREATMENT OF SUBORDINATED DEBENTURE CLAIMS
(CLASS 8).....................................................................................15
12.1 Treatment of Allowed Subordinated Debenture Claims............................................15
Article XIII PROVISION FOR TREATMENT OF LENDING SUBORDINATED DEBENTURE
CLAIMS (CLASS 8A).............................................................................16
13.1 Treatment of Lending Subordinated Debenture Claims............................................16
Article XIV PROVISION FOR TREATMENT OF PRIDE EQUITY INTERESTS (CLASS 9)...................................16
14.1 Treatment of Pride Equity Interests...........................................................16
Article XV PROVISION FOR TREATMENT OF STATUTORILY SUBORDINATED CLAIMS
(CLASS 10A) AND UNITED COMPANIES COMMON EQUITY INTERESTS
(CLASS 10B)....................................................................................16
15.1 Treatment of Statutorily Subordinated Claims..................................................16
15.2 Cancellation of Existing Equity Interests.....................................................16
Article XVI PROVISION FOR TREATMENT OF ADOBE COMMON EQUITY INTERESTS
(CLASS 11)....................................................................................16
16.1 Treatment of Adobe Common Equity Interest.....................................................16
Article XVII PROVISION FOR TREATMENT OF ADOBE FINANCIAL COMMON EQUITY
INTERESTS (CLASS 12)..........................................................................16
17.1 Treatment of Adobe Financial Common Equity Interest...........................................16
Article XVIII PROVISION FOR TREATMENT OF GINGER MAE COMMON EQUITY
INTERESTS (CLASS 13)..........................................................................17
18.1 Treatment of Ginger Mae Common Equity Interests...............................................17
Article XIX PROVISION FOR TREATMENT OF GOPHER EQUITY COMMON EQUITY
INTERESTS (CLASS 14)..........................................................................17
19.1 Treatment of Gopher Equity Common Equity Interests............................................17
Article XX PROVISION FOR TREATMENT OF PELICAN COMMON EQUITY INTERESTS
(CLASS 15)....................................................................................17
20.1 Treatment of Pelican Common Equity Interests..................................................17
Article XXI PROVISION FOR TREATMENT OF SOUTHERN MORTGAGE COMMON EQUITY
INTERESTS (CLASS 16)..........................................................................17
21.1 Treatment of Southern Mortgage Common Equity Interests........................................17
Article XXII PROVISION FOR TREATMENT OF UNICOR COMMON EQUITY INTERESTS
(CLASS 17)....................................................................................17
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22.1 Treatment of Unicor Common Equity Interests...................................................17
Article XXIII PROVISION FOR TREATMENT OF UNITED FUNDING COMMON EQUITY
INTERESTS (CLASS 18)..........................................................................18
23.1 Treatment of United Funding Common Equity Interests...........................................18
Article XXIV PROVISION FOR TREATMENT OF UNITED LENDING CORP. COMMON EQUITY
INTERESTS (CLASS 19)..........................................................................18
24.1 Treatment of United Lending Corp. Common Equity Interests.....................................18
Article XXV PROVISION FOR TREATMENT OF UNITED LENDING GROUP COMMON
EQUITY INTERESTS (CLASS 20)...................................................................18
25.1 Treatment of United Lending Group Common Equity Interests.....................................18
Article XXVI PROVISION FOR TREATMENT OF UNITED CREDIT CARD COMMON EQUITY
INTERESTS (CLASS 21)..........................................................................18
26.1 Treatment of United Credit Card Common Equity Interests.......................................18
Article XXVII PROVISIONS FOR TREATMENT OF DISPUTED CLAIMS UNDER THE PLAN....................................18
27.1 Objections to Claims; Prosecution of Disputed Claims..........................................18
27.2 Estimation of Claims..........................................................................19
27.3 Payments and Distributions on Disputed Claims.................................................19
Article XXVIII THE LITIGATION TRUST..........................................................................19
28.1 Establishment of the Trust....................................................................19
28.2 Purpose of the Litigation Trust...............................................................19
28.3 Funding Expenses of the Litigation Trust......................................................19
28.4 Transfer of Assets............................................................................19
28.5 Valuation of Assets...........................................................................20
28.6 Litigation of Assets; Responsibilities of Litigation Trustee..................................20
28.7 Investment Powers.............................................................................20
28.8 Annual Distribution; Withholding..............................................................20
28.9 Reporting Duties..............................................................................21
28.10 Trust Implementation..........................................................................21
28.11 Registry of Beneficial Interests..............................................................21
28.12 Termination...................................................................................22
28.13 Net Litigation Trust Recovery/Affirmative Obligations.........................................22
28.14 Escrow on Account of Disputed Claims..........................................................22
28.15 Non-Transferability...........................................................................23
Article XXIX PROSECUTION OF CLAIMS HELD BY THE DEBTORS.....................................................23
29.1 Prosecution of Claims.........................................................................23
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29.2 Net Payment by Defendants.....................................................................23
Article XXX ACCEPTANCE OR REJECTION OF PLAN; EFFECT OF REJECTION BY ONE OR
MORE CLASSES OF CLAIMS OR EQUITY INTEREST.....................................................23
30.1 Impaired Classes to Vote......................................................................23
30.2 Acceptance by Class of Creditors and Holders of Equity Interests..............................24
30.3 Cramdown......................................................................................24
Article XXXI IDENTIFICATION OF CLAIMS AND EQUITY INTERESTS IMPAIRED AND NOT
IMPAIRED BY THE PLAN..........................................................................24
31.1 Impaired and Unimpaired Classes...............................................................24
31.2 Impaired Classes to Vote on Plan..............................................................24
31.3 Controversy Concerning Impairment.............................................................24
Article XXXII PROVISIONS FOR THE ESTABLISHMENT AND MAINTENANCE OF
DISBURSEMENT ACCOUNTS.........................................................................24
32.1 Establishment of Disbursement Account.........................................................24
32.2 Maintenance of Disbursement Account(s)........................................................24
Article XXXIII PROVISIONS REGARDING DISTRIBUTIONS............................................................25
33.1 Time and Manner of Payments...................................................................25
33.2 Timeliness of Payments........................................................................25
33.3 Distributions by the Disbursing Agent.........................................................25
33.4 Manner of Payment under the Plan..............................................................25
33.5 Delivery of Distributions.....................................................................25
33.6 Undeliverable Distributions...................................................................25
33.7 Compliance with Tax Requirements..............................................................26
33.8 Time Bar to Cash Payments.....................................................................26
33.9 Distributions After Effective Date............................................................26
33.10 Set-Offs......................................................................................26
33.11 Termination of Certain Subordination Rights and Settlement of Related Claims and
Controversies.................................................................................26
Article XXXIV COMMITTEES....................................................................................27
34.1 Creditors' Committee Composition and Term.....................................................27
34.2 Equity Committee Term and Fees................................................................27
Article XXXV EXECUTORY CONTRACTS AND UNEXPIRED LEASES......................................................27
35.1 Rejection of Executory Contracts and Unexpired Leases.........................................27
35.2 Cure of Defaults for Assumed Executory Contracts and Unexpired Leases.........................27
35.3 Rejection Damage Claims.......................................................................28
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35.4 Indemnification and Reimbursement Obligations.................................................28
36.1 Exculpation...................................................................................28
36.2 Powers of the Disbursing Agent................................................................28
36.3 Fees and Expenses Incurred From and After the Effective Date..................................28
Article XXXVII THE PLAN ADMINISTRATOR........................................................................28
37.1 Appointment of Plan Administrator.............................................................28
37.2 Responsibilities of the Plan Administrator....................................................29
37.3 Powers of the Plan Administrator..............................................................29
37.4 Compensation of the Plan Administrator........................................................29
37.5 Termination of Plan Administrator.............................................................29
Article XXXVIII CONDITIONS PRECEDENT TO EFFECTIVE DATE OF THE PLAN............................................29
38.1 Conditions Precedent to Effective Date of the Plan............................................29
38.2 Waiver of Conditions Precedent................................................................29
Article XXXIX RETENTION OF JURISDICTION.....................................................................30
39.1 Retention of Jurisdiction.....................................................................30
Article XL MODIFICATION, REVOCATION, OR WITHDRAWAL OF THE PLAN...........................................31
40.1 Modification of Plan..........................................................................31
40.2 Revocation or Withdrawal......................................................................31
Article XLI PROVISION FOR MANAGEMENT......................................................................31
41.1 Directors.....................................................................................31
Article XLII ARTICLES OF INCORPORATION AND BY-LAWS OF THE DEBTORS;
CORPORATE ACTION..............................................................................31
42.1 Amendment of Articles of Incorporation and By-Laws............................................31
42.2 Corporate Action..............................................................................31
Article XLIII MISCELLANEOUS PROVISIONS......................................................................32
43.1 Title to Assets; Discharge of Liabilities.....................................................32
43.2 Discharge of Debtors..........................................................................32
43.3 Injunction....................................................................................32
43.4 Term of Existing Injunctions or Stays.........................................................32
43.5 Limited Release of Directors, Officers and Employees..........................................32
43.6 Exculpation...................................................................................33
43.7 Preservation of Rights of Action..............................................................33
43.8 Injunction....................................................................................33
43.9 Payment of Statutory Fees.....................................................................33
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43.10 Retiree Benefits..............................................................................33
43.11 Post-Effective Date Fees and Expenses.........................................................33
43.12 Severability..................................................................................33
43.13 Governing Law.................................................................................33
43.14 Notices.......................................................................................34
43.15 Closing of Cases..............................................................................34
43.16 Section Headings..............................................................................34
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United Companies Financial Corporation, Pelican Mortgage Company, Inc.,
United Companies Lending Group, Inc., United Companies Lending Corporation,
Adobe, Inc., Adobe Financial, Inc. I, Ginger Mae, Inc., Unicor Mortgage, Inc.,
Southern Mortgage Acquisition, Inc., United Companies Funding, Inc., Gopher
Equity, Inc., and United Credit Card, Inc. hereby propose the following plan of
reorganization pursuant to sections 1121(a) and (c) and 1123 of the Bankruptcy
Code.
ARTICLE I
DEFINITIONS
As used in the Plan, the following terms shall have the respective
meanings specified below and be equally applicable to the singular and plural of
terms defined:
1.1 Administrative Expense Claim: Any Claim constituting a cost or expense
of administration of the Chapter 11 Cases asserted under section 503(b) of the
Bankruptcy Code, including, without limitation, any actual and necessary costs
and expenses of preserving the estates of the Debtors, any actual and necessary
costs and expenses of operating the businesses of the Debtors in Possession, any
indebtedness or obligations incurred or assumed by the Debtors in Possession in
connection with the conduct of their businesses or for the acquisition or lease
of property or the procurement or rendition of services, any costs and expenses
of the Debtors in Possession for the management, maintenance, preservation, sale
or other disposition of any assets, the administration and implementation of the
Plan, the administration, prosecution or defense of Claims by or against the
Debtors and for distributions under the Plan, any Claims for compensation and
reimbursement of expenses arising during the period from and after the Petition
Date and prior to the Effective Date or otherwise in accordance with the
provisions of the Plan, and any fees or charges assessed against the Debtors'
estates pursuant to section 1930, chapter 123, Title 28, United States Code.
1.2 Adobe Financial: Adobe Financial, Inc. I, a Nevada corporation.
1.3 Adobe Financial Common Equity Interest: A Common Equity Interest in
Adobe Financial.
1.4 Adobe: Adobe, Inc., a Nevada corporation.
1.5 Adobe Common Equity Interest: A Common Equity Interest in Adobe.
1.6 Affiliate: Any Entity that is an "affiliate" of the Debtors within the
meaning of section 101(2) of the Bankruptcy Code.
1.7 Agent: First Union National Bank, as administrative agent for the
Banks.
1.8 Allowed Administrative Expense Claim: An Administrative Expense Claim,
to the extent it is or has become an Allowed Claim.
1.9 Allowed Claim/Allowed Equity Interest: Any Claim against or Equity
Interest in the Debtors, (i) proof of which was filed on or before the date
designated by the Bankruptcy Court as the last date for filing proofs of claim
against or equity interests in the Debtors, (ii) if no proof of Claim or Equity
Interest has been timely filed, which has been or hereafter is listed by the
Debtors in their Schedules as liquidated in amount and not disputed or
contingent or (iii) any Equity Interest registered in the stock register
maintained by or on behalf of the Debtors as of the Record Date and, in each
such case in clauses (i), (ii) and (iii) above, a Claim or Equity Interest as to
which no objection to the allowance thereof has been interposed within the
applicable period of limitation fixed by the Plan, the Bankruptcy Code, the
Bankruptcy Rules or a Final Order, or as to which an objection has been
interposed and such Claim or Equity Interest has been allowed in whole or in
part by a Final Order. For purposes of determining the amount of an "Allowed
Claim", there shall be deducted therefrom an amount equal to the amount of any
claim which the Debtors may hold against the holder thereof, to the extent such
claim may be set off pursuant to section 553 of the Bankruptcy Code.
1.10 Allowed Bank Claim: A Bank Claim, to the extent it is or has become
an Allowed Claim.
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1.11 Allowed Borrower Litigation Claim: A Borrower Litigation Claim, to
the extent it is or has become an Allowed Claim.
1.12 Allowed Convenience Claim: A Convenience Claim, to the extent it is
or has become an Allowed Claim.
1.13 Allowed General Unsecured Claim: A General Unsecured Claim, to the
extent it is or has become an Allowed Claim.
1.14 Allowed Lending Subordinated Debenture Claim: A Lending Subordinated
Debenture Claim, to the extent it is or has become an Allowed Claim.
1.15 Allowed Pride Equity Interest: A Pride Equity Interest, to the extent
it is or has become an Allowed Equity Interest.
1.16 Allowed Priority Non-Tax Claim: A Priority Non-Tax Claim, to the
extent it is or has become an Allowed Claim.
1.17 Allowed Priority Tax Claim: A Priority Tax Claim, to the extent it is
or has become an Allowed Claim.
1.18 Allowed Secured Claim: A Secured Claim, to the extent it is or has
become an Allowed Claim.
1.19 Allowed Senior Claim: A Senior Note Claim, to the extent it is or has
become an Allowed Claim.
1.20 Allowed Statutorily Subordinated Claim: A Statutorily Subordinated
Claim to the extent it is or has become an Allowed Claim.
1.21 Allowed Subordinated Debenture Claim: A Subordinated Debenture Claim,
to the extent it is or has become an Allowed Claim.
1.22 Ballot: The form distributed to each holder of an impaired Claim on
which is to be indicated acceptance or rejection of the Plan.
1.23 Bank Cash Amount: The amount of Cash equal to the product of (a)
Senior Creditor Cash times (b) eighty-five percent (85%).
1.24 Bank Claims: Any Claims of the Banks arising from or related to the
Credit Agreement, including, without limitation, fees and expenses associated
with rights and remedies thereunder, or the Guaranty.
1.25 Bankruptcy Code: The Bankruptcy Reform Act of 1978, as amended, and
as codified in Title 11, United States Code, as applicable to the Chapter 11
Cases.
1.26 Bankruptcy Court: The United States Bankruptcy Court for the District
of Delaware or such other court having jurisdiction over the Chapter 11 Cases.
1.27 Bankruptcy Rules: The Federal Rules of Bankruptcy Procedure, as
promulgated by the United States Supreme Court under section 2075 of Title 28 of
the United States Code, and any Local Rules of the Bankruptcy Court, as amended.
1.28 Banks: The banks or financial institutions that are parties to the
Credit Agreement and their successors and assigns.
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1.29 Biase Litigation: The litigation styled Findim Investments, S.A.,
Nicole Biase, Joyce Biase and Nicolas Biase v. J. Terrell Brown and Dale E.
Redman, No. 464-161, currently pending in Division "M", 19th Judicial District
Court, Parish of East Baton Rouge, State of Louisiana.
1.30 Borrower Litigation Claim: Any Claim asserted in litigation pending
on or as of the Petition Date, or that could have been asserted by any Entity
prior to the Petition Date with respect to the servicing of mortgage loans by
the Debtors or Claims associated with the origination moneys advanced or
mortgages issued by the Debtors prior to the Petition Date.
1.31 Borrower Settlement Trust: The trust to be created on the Effective
Date in accordance with the provisions of Article IX hereof and the Borrower
Settlement Trust Agreement and funded in the amount of Five Million Dollars
($5,000,000.00) on the Effective Date to arbitrate or compromise and settle
Borrower Litigation Claims, including, without limitation, all Claims filed
against the Debtors' chapter 11 estates in connection with class action lawsuits
pending as of the Petition Date, either certified as a class or in which class
certification has been requested or mentioned.
1.32 Borrower Settlement Trust Agreement: The Trust Agreement,
substantially in the form in the Plan Supplement, pursuant to which the Plan
Administrator shall arbitrate or compromise and settle Borrower Litigation
Claims.
1.33 Business Day: A day other than a Saturday, a Sunday or any other day
on which commercial banks in Baton Rouge, Louisiana are required or authorized
to close by law or executive order.
1.34 Cash: Lawful currency of the United States of America.
1.35 Cash Equivalents: Equivalents of Cash in the form of readily
marketable securities or instruments issued by a person other than the Debtors,
including, without limitation, readily marketable direct obligations of, or
obligations guaranteed by, the United States of America, commercial paper of
domestic corporations carrying a Moody's Rating of "A" or better, or equivalent
rating of any other nationally recognized rating service, or interest-bearing
certificates of deposit or other similar obligations of domestic banks or other
financial institutions having a shareholders' equity or equivalent capital of
not less than One Hundred Million Dollars ($100,000,000.00), having maturities
of not more than one (1) year, at the then best generally available rates of
interest for like amounts and like periods.
1.36 Chapter 11 Cases: The cases commenced under chapter 11 of the
Bankruptcy Code by the Debtors on the Petition Date, styled In re United
Companies Financial Corporation, et al., Chapter 11 Case Nos. 99-450 (MFW)
through 99-461 (MFW), Jointly Administered, currently pending before the
Bankruptcy Court.
1.37 Claim: Any right to payment from the Debtors, whether or not such
right is reduced to judgment, liquidated, unliquidated, fixed, contingent,
matured, unmatured, disputed, undisputed, legal, equitable, secured, or
unsecured, known or unknown; or any right to an equitable remedy for breach of
performance if such breach gives rise to a right of payment from the Debtors,
whether or not such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured, unmatured, disputed, undisputed, secured, or unsecured.
1.38 Class: A category of holders of Claims or Equity Interests as set
forth in Article IV of the Plan.
1.39 Class Actions: The litigations styled (1) Norman P. Lasky, on behalf
of himself and all others similarly situated v. J. Terrell and Dale E. Redman,
No. 99-1035-B-2, (2) Gary W. Poff, on behalf of himself and all others similarly
situated v. J. Terrell Brown and Dale E. Redman, No. 00-CV-6-B-M1, (3) Linda
Wheeler, on behalf of herself and all others similarly situated v. J. Terrell
Brown and Dale E. Redman, No. 99-1049-B-3, (4) Frank Lopiccolo, on behalf of
himself and all others similarly situated v. J. Terrell Brown, Dale E. Redman,
Certain Underwriters at Lloyds Underwriters of London and AIG Europe (UK) Ltd.,
No. 00-99-B-M3, all pending before the United States District Court for the
Middle District of Louisiana, and (5) Amy Bergeron, et al. v. U.S. Trust
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<PAGE> 15
Company of California, et al; No C 469196, currently pending in Division "H",
19th Judicial District Court, Parish of East Baton Rouge, State of Louisiana.
1.40 Collateral: Any property or interest in property of the estates of
the Debtors that is subject to an unavoidable Lien to secure the payment or
performance of a Claim.
1.41 Common Equity Interest: A common Equity Interest.
1.42 Confirmation Date: The date upon which the Clerk of the Bankruptcy
Court enters the Confirmation Order.
1.43 Confirmation Hearing: The hearing to consider confirmation of the
Plan in accordance with section 1129 of the Bankruptcy Code, as the same may be
adjourned from time to time.
1.44 Confirmation Order: The order of the Bankruptcy Court confirming the
Plan in accordance with the provisions of chapter 11 of the Bankruptcy Code.
1.45 Convenience Claim: Any Claim, other than a Borrower Litigation Claim,
equal to or less than One Thousand Dollars ($1,000.00) or greater than One
Thousand Dollars ($1,000.00) but with respect to which the holder thereof
voluntarily reduces the Claim to One Thousand Dollars ($1,000.00).
1.46 Credit Agreement: That certain Credit Agreement, dated as of April
10, 1997, by and among the Debtors, the Agent, the Documentation Agent and the
Banks, as amended and modified from time to time, and any of the documents and
instruments related thereto.
1.47 Creditor: Any Person or Entity that has a Claim against the Debtors
that arose or is deemed to have arisen on or prior to the Petition Date,
including, without limitation, a Claim against the Debtors' chapter 11 estates
of a kind specified in sections 502(g), 502(h) or 502(i) of the Bankruptcy Code.
1.48 Creditor Cash: At any time of determination thereof, the excess, if
any, of (a) all Cash and Cash Equivalents in the Disbursement Account(s) over
(b) such amounts of Cash (i) reasonably determined by the Disbursing Agent as
necessary to satisfy, in accordance with the terms and conditions of the Plan,
Administrative Expense Claims, Priority Non-Tax Claims, Priority Tax Claims,
Convenience Claims and Secured Claims, (ii) necessary to fund the Litigation
Trust in accordance with Article XXVIII of the Plan, (iii) necessary to make pro
rata distributions to holders of Disputed Claims as if such Disputed Claims
were, at such time, Allowed Claims and (iv) such other amounts reasonably
determined by Reorganized UC as necessary to fund the ongoing operations of
Reorganized UC during the period from the Effective Date up to and including the
Transfer Date or such later date as the Plan Administrator shall reasonably
determine.
1.49 Creditors' Committee: The statutory committee of unsecured creditors
appointed in the Chapter 11 Cases pursuant to section 1102 of the Bankruptcy
Code.
1.50 Debtors: United Companies Financial Corporation, Pelican Mortgage
Company, Inc., United Companies Lending Group, Inc., United Companies Lending
Corporation, Adobe, Inc., Adobe Financial, Inc. I, Ginger Mae, Inc., Unicor
Mortgage, Inc., Southern Mortgage Acquisition, Inc., United Companies Funding,
Inc., Gopher Equity, Inc., and United Credit Card, Inc.
1.51 Debtors in Possession: The Debtors as debtors in possession pursuant
to sections 1107(a) and 1108 of the Bankruptcy Code.
1.52 Disbursement Account(s): The account(s) to be established by the
Debtors on the Effective Date in accordance with Section 32.1 of the Plan,
together with any interest earned thereon.
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1.53 Disbursing Agent: Reorganized UC, the Plan Administrator or such
other Entity as may be designated by the Debtors, solely in its capacity as
agent of the Debtors to effectuate the distributions contemplated under the
Plan.
1.54 Disclosure Statement: The disclosure statement related to the Plan
and approved by the Bankruptcy Court in accordance with section 1125 of the
Bankruptcy Code.
1.55 Disputed Claim; Disputed Equity Interest: Any Claim against or Equity
Interest in the Debtors, to the extent the allowance of which is the subject of
a timely objection or request for estimation in accordance with the Plan, the
Bankruptcy Code, the Bankruptcy Rules or the Confirmation Order, or is otherwise
disputed by the Debtors in accordance with applicable law, which objection,
request for estimation or dispute has not been withdrawn or determined by a
Final Order.
1.56 Disputed Claim Amount: The lesser of (a) the amount of a Disputed
Claim as filed with the Bankruptcy Court and (b) if the Bankruptcy Court has
estimated such Disputed Claim pursuant to section 502(c) of the Bankruptcy Code,
the amount of a Disputed Claim as estimated by the Bankruptcy Court; provided,
however, that nothing contained in the Plan is intended to or shall affect any
Person's or Entity's rights under section 502(j) of the Bankruptcy Code.
1.57 Documentation Agent: Morgan Stanley Trust Company of New York.
1.58 Effective Date: The first (1st) Business Day ten (10) days following
the entry of the Confirmation Order.
1.59 8.375% Notes: Those certain debentures issued in the original
aggregate principal amount of One Hundred Fifty Million Dollars
($150,000,000.00) in accordance with the terms and conditions of the
Subordinated Indenture, as supplemented by that certain First Supplemental
Indenture, dated as of June 20, 1997.
1.60 Entity: A person, a corporation, a general partnership, a limited
partnership, a limited liability company, a limited liability partnership, an
association, a joint stock company, a joint venture, an Estates, a trust, an
unincorporated organization, a government or any subdivision thereof or any
other entity.
1.61 Equity Committee: The committee of equity interest holders appointed
in the Chapter 11 Cases pursuant to section 1102 of the Bankruptcy Code, as
reconstituted from time to time.
1.62 Equity Interest: Any equity interest in the Debtors represented by
duly authorized, validly issued and outstanding shares of preferred stock or
common stock or any interest or right to convert into such an equity interest or
acquire any equity interest of the Debtors which was in existence immediately
prior to the Petition Date.
1.63 ESOP Action: The litigation styled Amy Bergeron, et al. v. U.S. Trust
Company of California, et al., No. C 469196, currently pending in Division "H",
19th Judicial District Court, Parish of East Baton Rouge, State of Louisiana.
1.64 Final Order: An order of the Bankruptcy Court as to which the time to
appeal, petition for certiorari or move for reargument or rehearing has expired
and as to which no appeal, petition for certiorari or other proceedings for
reargument or rehearing shall then be pending; and if an appeal, writ of
certiorari, reargument or rehearing thereof has been sought, such order shall
have been affirmed by the highest court to which such order was appealed, or
certiorari shall have been denied or reargument or rehearing shall have been
denied or resulted in no modification of such order, and the time to take any
further appeal, petition for certiorari or move for reargument or rehearing
shall have expired; provided, however, that the possibility that a motion under
Rule 59 or Rule 60 of the Federal Rules of Civil Procedure or any analogous rule
under the Bankruptcy Rules, may be but has not then been filed with respect to
such order, shall not cause such order not to be a Final Order.
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1.65 General Unsecured Claim: An Unsecured Claim, other than an
Intercompany Claim, an Administrative Expense Claim, a Priority Non-Tax Claim, a
Priority Tax Claim, a Bank Claim, a Senior Note Claim, a Borrower Litigation
Claim, a Subordinated Debenture Claim, or a Convenience Claim.
1.66 Ginger Mae: Ginger Mae, Inc., a Louisiana corporation.
1.67 Ginger Mae Common Equity Interest: A Common Equity Interest in Ginger
Mae.
1.68 Gopher Equity: Gopher Equity, Inc., a Nevada corporation.
1.69 Gopher Equity Common Equity Interest: A Common Equity Interest in
Gopher Equity.
1.70 Guaranty: That certain Unconditional Guaranty Agreement, dated as of
April 10, 1997, by and among the Debtors, the Agent and the Banks.
1.71 Intercompany Affiliate: Any of the Debtors and any other direct or
indirect subsidiary of United Companies.
1.72 Intercompany Claims: Any Unsecured Claim held by any Intercompany
Affiliate against any Debtor.
1.73 IRC: The Internal Revenue Code of 1986, as amended from time to time.
1.74 IRS: The Internal Revenue Service, an agency of the United States
Department of Treasury.
1.75 Lending Subordinated Debentures: The promissory notes issued and
delivered by United Lending Corp. in accordance with the terms and provisions of
the Lending Subordinated Indenture.
1.76 Lending Subordinated Debenture Claim: Any Claim arising from or
relating to the Lending Subordinated Debentures.
1.77 Lending Subordinated Indenture: That certain Agreement, dated May 14,
1993, between United Lending Corp. and United Companies Life Insurance Company.
1.78 Lien: Any charge against or interest in property to secure payment of
a debt or performance of an obligation.
1.79 Litigation Trust: The trust to be created on the Effective Date in
accordance with the provisions of Article XXVIII hereof and the Litigation Trust
Agreement for the benefit of holders of Allowed Bank Claims and Allowed Senior
Note Claims.
1.80 Litigation Trustee: The Entity to be appointed by the Litigation
Trust Board to administer the Litigation Trust in accordance with the terms and
provisions of Article XXVIII hereof and the Litigation Trust Agreement.
1.81 Litigation Trust Agreement: The Trust Agreement, substantially in the
form in the Plan Supplement, pursuant to which the Litigation Trustee shall
pursue the Litigation Trust Claims, if applicable, and distribute the proceeds
thereof, if any.
1.82 Litigation Trust Board: The three Persons appointed prior to the
Effective Date by the Bankruptcy Court, upon nomination by the Creditors'
Committee, or any replacements thereafter selected in accordance with the
provisions of the Litigation Trust Agreement, who shall determine in accordance
with the Litigation Trust Agreement whether to prosecute, compromise or
discontinue any Litigation Trust Claims.
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<PAGE> 18
1.83 Litigation Trust Claims: Those claims and causes of action of the
Debtors, if any, arising from or related to the Debtors' financial statements
and the accounting practices associated therewith; provided, however, that,
under no circumstances shall such claims and causes of action include any claims
waived and released in accordance with the provisions of Section 43.5 of the
Plan.
1.84 Litigation Trust Interests: The ten million (10,000,000) beneficial
interests in the Litigation Trust to be deemed to be distributed to holders of
Allowed Bank Claims and Allowed Senior Note Claims pursuant to the terms and
conditions of Article XXVIII of the Plan.
1.85 9.35% Notes: Those certain debentures issued in the original
aggregate principal amount of One Hundred Twenty-Five Million Dollars
($125,000,000.00) in accordance with the terms and provisions of the Senior
Indenture, as supplemented, by that certain First Supplemental Indenture, dated
as of November 2, 1994.
1.86 Pelican: Pelican Mortgage Company, Inc., a Delaware corporation.
1.87 Pelican Common Equity Interest: A Common Equity Interest in Pelican.
1.88 Person: An individual.
1.89 Petition Date: March 1, 1999, the date on which the Debtors filed
their voluntary petitions for relief commencing the Chapter 11 Cases.
1.90 Plan: This First Amended Plan of Reorganization for Debtors Pursuant
to Chapter 11 of the United States Bankruptcy Code, including, without
limitation, the exhibits and schedules hereto and the Plan Supplement, either in
its present form or as the same may be amended, modified or supplemented from
time to time in accordance with the terms and provisions hereof.
1.91 Plan Administration Agreement: The agreement prescribing the powers,
duties and rights of the Plan Administrator in administering the Plan, which
agreement shall be in substantially the form included in the Plan Supplement.
1.92 Plan Administrator: The Person to be designated by the Debtors and
retained, as of the Effective Date, by Reorganized UC, with the approval of the
Bankruptcy Court, as the employee or fiduciary responsible for, among other
things, the matters described in Section 36.2 hereof.
1.93 Plan Supplement: A separate volume, to be filed with the Clerk of the
Bankruptcy Court, containing, among other things, forms of the Borrower
Settlement Trust Agreement, Litigation Trust Agreement, Plan Administration
Agreement, Reorganized UC By-laws and Reorganized UC Certificate of
Incorporation. The Plan Supplement (containing drafts or final versions of the
foregoing documents) shall be filed with the Clerk of the Bankruptcy Court as
early as practicable (but in no event later than ten (10) days) prior to the
commencement of the hearing to consider confirmation of the Plan, or on such
other date as the Bankruptcy Court may establish.
1.94 Pride Equity Interest: An Equity Interest represented by one of the
1,657,770 issued and outstanding shares of Preferred Redeemable Increased
Dividend Equity Securities(SM), 6 3/4% PRIDES(SM), Convertible Preferred Stock,
par value $2.00 per share, of United Companies as of the Petition Date.
1.95 Pride Prospectus: The prospectus, dated June 12, 1995, as
supplemented, released in connection with the offering of Pride Equity
Interests.
1.96 Priority Non-Tax Claim: Any Claim against the Debtors, other than an
Administrative Expense Claim or a Priority Tax Claim, entitled to priority in
payment under section 507(a) of the Bankruptcy Code, but only to the extent
entitled to such priority.
1.97 Priority Tax Claim: Any Claim against the Debtors entitled to
priority in payment under section 507(a)(8) of the Bankruptcy Code.
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1.98 Proponents: Debtors in Possession.
1.99 Pro Rata Share: With respect to Allowed Claims or Allowed Equity
Interests within the same Class or sub-Class, the proportion that an Allowed
Claim or Allowed Equity Interest bears to the sum of (a) all Allowed Claims
and/or Allowed Equity Interests, as the case may be, within such Class or
sub-Class, and (b) all Disputed Claim Amounts and/or Disputed Equity Interest
Amounts, as the case may be, within such Class or sub-Class.
1.100 Record Date: The date to be established by the Bankruptcy Court in
the Confirmation Order for the purpose of determining the holders of Allowed
Claims and Allowed Equity Interests to receive distributions pursuant to the
Plan.
1.101 Remaining Assets: Upon the consummation of a Sale Transaction, those
assets of Reorganized UC, other than the Litigation Trust Claims which are not
included in the Sale Transaction, including, without limitation, the furniture,
fixtures and equipment associated with the business and operations of the
Debtors.
1.102 Reorganized UC: United Companies, a Louisiana corporation, and each
of the Reorganized UC Subsidiaries, from and after the Effective Date.
1.103 Reorganized UC By-laws: The By-laws of Reorganized UC, which by-laws
shall be in substantially the form contained in the Plan Supplement.
1.104 Reorganized UC Certificate of Incorporation: The Certificate of
Incorporation of Reorganized UC, which certificate of incorporation shall be in
substantially the form included in the Plan Supplement.
1.105 Reorganized UC Common Stock: The shares of Reorganized UC Common
Stock authorized and to be issued pursuant to the Plan, which shall have a par
value of $0.01 per share, of which five million (5,000,000) shares shall be
authorized and of which one million (1,000,000) shares shall be issued pursuant
to the Plan, and such rights with respect to dividends, liquidation, voting and
other matters as are provided for by applicable nonbankruptcy law or the
Reorganized UC Certificates of Incorporation and the Reorganized UC By-laws.
1.106 Reorganized UC Subsidiaries: Each subsidiary, along with United
Companies, comprising Reorganized UC.
1.107 Residual Agreement: That certain Asset Purchase Agreement, dated as
of May 26, 2000, by and among The Bear Stearns Companies, Inc., EMC Mortgage
Corporation, EMC Mortgage Acquisition Corp., United Companies, United Lending
Corp., UCFC Acceptance Corporation, United Funding, Pelican, Adobe, Adobe
Financial, Gopher Equity, and Gopher Funding, Inc.
1.108 Sale Transaction: The sale of (i) certain of the Debtors' residual,
excess interest and reserve account interests and other property rights pursuant
to the Residual Agreement, or such higher or better offer as may be submitted,
accepted by the Debtors and approved by the Bankruptcy Court, and (ii) certain
of the Debtors' portfolio of mortgage loans and real properties acquired in
connection with the ownership of mortgage loans pursuant to the Whole Loan
Agreement, or such higher or better offer as may be submitted, accepted by the
Debtors and approved by the Bankruptcy Court, which sales shall be consummated
on or prior to the Effective Date.
1.109 Schedules: The respective schedules of assets and liabilities, the
list of Equity Interests, and the statements of financial affairs filed by the
Debtors in accordance with section 521 of the Bankruptcy Code and the Official
Bankruptcy Forms of the Bankruptcy Rules as such schedules and statements have
been or may be supplemented or amended.
1.110 Secured Claim: A Claim against the Debtors that is secured by a Lien
on Collateral or that is subject to setoff under section 553 of the Bankruptcy
Code, to the extent of the value of the Collateral or to
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<PAGE> 20
the extent of the amount subject to setoff, as applicable, as determined in
accordance with section 506(a) of the Bankruptcy Code.
1.111 Senior Creditor Cash: At any time of determination thereof, the
amount of Cash equal to (a) Creditor Cash minus (b) the amount of Cash necessary
to satisfy distributions to holders of Allowed General Unsecured Claims in
accordance with the provisions of Article X of the Plan.
1.112 Senior Indenture: That certain Senior Indenture, dated as of October
1, 1994, between United Companies Financial Corporation, as Issuer, and the
Senior Indenture Trustee, as supplemented.
1.113 Senior Indenture Trustee: The First National Bank of Chicago.
1.114 Senior Note Cash Amount: The amount of Cash equal to the product of
(a) Senior Creditor Cash times (b) fifteen percent (15%).
1.115 Senior Note Claims: Any claim arising under or relating to the
Senior Indenture.
1.116 Senior Notes: Collectively, the 9.35% Notes and the 7.7% Notes.
1.117 7.7% Notes: Those certain debentures issued in the original
aggregate principal amount of One Hundred Million Dollars ($100,000,000.00) in
accordance with the terms and provisions of the Senior Indenture as supplemented
by that certain Third Supplemental Indenture, dated as of December 17, 1996.
1.118 Southern Mortgage: Southern Mortgage Acquisition, Inc., a Louisiana
corporation.
1.119 Southern Mortgage Common Equity Interest: A Common Equity Interest
in Southern Mortgage.
1.120 Statutorily Subordinated Claim: Any Claim that is subject to
subordination under section 510(b) of the Bankruptcy Code, including, without
limitation, (i) any and all Claims for fines, penalties, forfeitures, or other
non-pecuniary, in direct or non-proximate damages arising from or related to the
Debtors' loan origination and servicing operations and (ii) any and all Claims
of a holder or former holder of an Equity Interest for rescission of or damages
from the purchase or sale of an Equity Interest arising from or relating to the
Debtors' financial statements and the accounting practices associated therewith.
1.121 Subordinated Debenture Claim: Any Claim arising from or relating to
the Subordinated Debentures.
1.122 Subordinated Debentures: The 8.375% Notes.
1.123 Subordinated Indenture: That certain Subordinated Indenture, dated
as of February 19, 1997, between United Companies Financial Corporation, as
issuer, and the Subordinated Indenture Trustee, as supplemented.
1.124 Subordinated Indenture Trustee: HSBC Bank USA, in its capacity as
successor indenture trustee under the Subordinated Indenture and any successor
indenture trustee under the Subordinated Indenture.
1.125 Transfer Date: The later to occur of (a) the date on which United
Lending Corp. transfers the servicing of mortgage loans in accordance with the
provisions of the Residual Agreement, or such higher or better offer as may be
submitted, accepted by the Debtors and approved by the Bankruptcy Court, and (b)
the date on which United Lending Corp. transfers the servicing of mortgage loans
in accordance with the provisions of the Whole Loan Agreement, or such higher or
better offer as may be submitted, accepted by the Debtors and approved by the
Bankruptcy Court, or such other date as may be determined by the Bankruptcy
Court at the Confirmation Hearing.
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1.126 Unicor: Unicor Mortgage, Inc., a Louisiana corporation.
1.127 Unicor Common Equity Interest: A Common Equity Interest in Unicor.
1.128 United Companies: United Companies Financial Corporation, a
Louisiana corporation.
1.129 United Companies Common Equity Interest: An Equity Interest
represented by one of the 28,808,211 issued and outstanding shares of common
stock of United Companies as of the Petition Date or any interest or right to
convert into such an equity interest or acquire any equity interest of the
Debtors which was in existence immediately prior to the Petition Date.
1.130 United Funding: United Companies Funding, Inc., a Louisiana
corporation.
1.131 United Funding Common Equity Interest: A Common Equity Interest in
United Funding.
1.132 United Lending Corp.: United Companies Lending Corporation, a
Louisiana corporation.
1.133 United Lending Corp. Common Equity Interest: A Common Equity
Interest in United Lending Corp.
1.134 United Lending Group: United Companies Lending Group, Inc., a
Louisiana corporation.
1.135 United Lending Group Common Equity Interest: A Common Equity
Interest in United Lending Group.
1.136 United Credit Card: United Credit Card, Inc., a Louisiana
corporation.
1.137 United Credit Card Common Equity Interest: A Common Equity Interest
in United Credit Card.
1.138 Unsecured Claim: Any Claim against the Debtors, other than an
Administrative Expense Claim, a Priority Non-Tax Claim, a Priority Tax Claim, a
Bank Claim, a Senior Note Claim, a Subordinated Debenture Claim, a Borrower
Litigation Claim, or a Convenience Claim.
1.139 Whole Loan Agreement: That certain Mortgage Loan and REO Property
Purchase Agreement, dated as of May 26, 2000, by and among The Bear Stearns
Companies, Inc., EMC Mortgage Corporation, United Companies, United Lending
Corp., United Funding, Southern Mortgage, United Companies Mortgage of
Tennessee, Unicor and United Companies Second Mortgage of Minnesota.
1.140 Other Definitions: Unless the context otherwise requires, any
capitalized term used and not defined herein or elsewhere in the Plan but that
is defined in the Bankruptcy Code shall have the meaning assigned to that term
in the Bankruptcy Code. Unless otherwise specified, all section, schedule or
exhibit references in the Plan are to the respective section in, article of, or
schedule or exhibit to, the Plan, as the same may be amended, waived, or
modified from time to time. The words "herein," "hereof," "hereto," "hereunder,"
and other words of similar import refer to the Plan as a whole and not to any
particular section, subsection, or clause contained in the Plan.
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ARTICLE II
COMPROMISE AND SETTLEMENT OF DISPUTES;
SUBSTANTIVE CONSOLIDATION OF DEBTORS;
ASSUMPTION OF OBLIGATIONS UNDER THE PLAN
2.1 Compromise and Settlement: The Plan incorporates a proposed compromise
and settlement of certain issues which were disputed by the Proponents, the
Committees and certain parties in interest. These issues related primarily to
whether the estates of each of the Debtors should be treated separately for
purposes of making payments to Creditors, whether and to what extent proceeds
from the Sale Transaction should be allocated among the Debtors based upon their
respective claims of ownership to certain assets sold thereunder, and the amount
and priority of certain Intercompany Claims. The provisions of the Plan relating
to substantive consolidation of the Debtors, the cancellation of Intercompany
Claims, and the treatment of each class of Claims under the Plan reflect this
compromise and settlement, which, upon the Effective Date, shall be binding upon
the Debtors, all Creditors, and all Persons receiving any payments or other
distributions under the Plan.
2.2 Substantive Consolidation: On the Effective Date, the Chapter 11 Cases
shall be deemed to be substantively consolidated for purposes of the Plan. The
assets and liabilities of the Debtors shall be pooled and all Claims shall be
satisfied from the assets of a single consolidated estate. Any Claims against
one or more of the Debtors based upon a guaranty, indemnity, co-signature,
surety or otherwise, of Claims against another Debtor, including, without
limitation, the Guaranty, shall be treated as a single Claim against the
consolidated estate of the Debtors and shall be entitled to distributions under
the Plan only with respect to such single Claim.
2.3 Cancellation of Intercompany Claims: On the Effective Date, all
Intercompany Claims shall be extinguished.
ARTICLE III
PROVISIONS FOR PAYMENT OF ADMINISTRATIVE EXPENSE CLAIMS AND PRIORITY TAX CLAIMS
3.1 Administrative Expense Claims: On the later to occur of (a) the
Effective Date and (b) the date on which such a Claim shall become an Allowed
Claim, Reorganized UC shall (i) pay to each holder of an Allowed Administrative
Expense Claim, in Cash, the full amount of such Allowed Administrative Expense
Claim, or (ii) satisfy and discharge such Allowed Administrative Expense Claim
in accordance with such other terms as may be agreed upon by and between the
holder thereof and the Debtors or Reorganized UC, as the case may be; provided,
however, that Allowed Administrative Expense Claims representing liabilities or
obligations incurred or assumed by the Debtors in Possession in the ordinary
course of business or liabilities arising under loans made or advances extended
to the Debtors in Possession, whether or not incurred in the ordinary course of
business, shall be assumed and paid by Reorganized UC in accordance with the
terms and conditions of the particular transaction and any agreements relating
thereto.
3.2 Professional Compensation and Reimbursement Claims: All Entities that
are awarded compensation or reimbursement of expenses by the Bankruptcy Court in
accordance with section 330 or 331 of the Bankruptcy Code or entitled to the
priorities established pursuant to section 503(b)(2), 503(b)(3), 503(b)(4) or
503(b)(5) of the Bankruptcy Code, shall be paid in full, in Cash, the amounts
allowed by the Bankruptcy Court (a) on or as soon as reasonably practicable
following the later to occur of (i) the Effective Date and (ii) the date upon
which the Bankruptcy Court order allowing such Claim becomes a Final Order or
(b) upon such other terms as may be mutually agreed upon between such holder of
an Allowed Administrative Expense Claim and the Debtors.
3.3 Payment of Priority Tax Claims: On the Effective Date, each holder of
an Allowed Priority Tax Claim shall be entitled to receive distributions in an
amount equal to the full amount of such Allowed Priority Tax Claim. At the sole
option and discretion of Reorganized UC, which option shall be exercised on or
prior to the Effective Date, such payment shall be made (a) in full, in Cash, on
the Effective Date, (b) in accordance with section 1129(a)(9)(C) of the
Bankruptcy Code, in full, in Cash, in up to twenty-four (24) equal quarterly
installments, commencing on the first (1st) Business Day following the date of
assessment of such Allowed Priority
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Tax Claim, together with interest accrued thereon at a rate to be determined by
the Bankruptcy Court, or (c) by mutual agreement of the holder of such Allowed
Priority Tax Claim and Reorganized UC.
Article IV
CLASSIFICATION OF CLAIMS AND EQUITY INTERESTS
Claims and Equity Interests are classified as follows:
<TABLE>
<S> <C>
4.1 Class 1 - Priority Non-Tax Claims
4.2 Class 2 - Secured Claims
4.3 Class 3 - Bank Claims
4.4 Class 4 - Senior Note Claims
4.5 Class 5 - Borrower Litigation Claims
4.6 Class 6 - General Unsecured Claims
4.7 Class 7 - Convenience Claims
4.8 Class 8 - Subordinated Debenture Claims
4.9 Class 8A - Lending Subordinated Debenture Claims
4.10 Class 9 - Pride Equity Interests
4.11 Class 10 - Class 10A - Statutorily Subordinated Claims
Class 10B - United Companies Common Equity Interests
4.12 Class 11 - Adobe Common Equity Interests
4.13 Class 12 - Adobe Financial Common Equity Interests
4.14 Class 13 - Ginger Mae Common Equity Interests
4.15 Class 14 - Gopher Equity Common Equity Interests
4.16 Class 15 - Pelican Common Equity Interests
4.17 Class 16 - Southern Mortgage Common Equity Interests
4.18 Class 17 - Unicor Common Equity Interests
4.19 Class 18 - United Funding Common Equity Interests
4.20 Class 19 - United Lending Corp. Common Equity Interests
4.21 Class 20 - United Lending Group Common Equity Interests
4.22 Class 21 - United Credit Card Common Equity Interests
</TABLE>
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ARTICLE V
PROVISION FOR TREATMENT OF PRIORITY NON-TAX CLAIMS (CLASS 1)
5.1 Payment of Allowed Priority Non-Tax Claims: Unless otherwise mutually
agreed upon by the holder of an Allowed Priority Non-Tax Claim and Reorganized
UC, each holder of an Allowed Priority Non-Tax Claim shall receive Cash in an
amount equal to such Allowed Priority Non-Tax Claim on the later of the
Effective Date and the date such Allowed Priority Non-Tax Claim becomes an
Allowed Priority Non-Tax Claim, or as soon thereafter as is practicable.
5.2 Continuation of Employee Medical Benefits: From the Effective Date up
to and including the first (1st) Business Day eighteen (18) months following the
earlier to occur of (a) the Effective Date and (b) the transfer of the Debtors'
servicing operations pursuant to a Sale Transaction or otherwise, Reorganized UC
shall provide, or cause to be provided through the deposit of funds reasonably
determined by Reorganized UC to be appropriate under the circumstances, employee
medical benefits in a manner and amount consistent with the Debtors' medical
benefits program prior to the Effective Date.
ARTICLE VI
PROVISION FOR TREATMENT OF SECURED CLAIMS (CLASS 2)
6.1 Treatment of Secured Claims: On the Effective Date, each holder of an
Allowed Secured Claim shall receive one of the following distributions: (a) the
payment of such holder's Allowed Secured Claim in full, in Cash; (b) the sale or
disposition proceeds of the property securing any Allowed Secured Claim to the
extent of the value of their respective interests in such property; (c) the
surrender to the holder or holders of any Allowed Secured Claim of the property
securing such Claim; or (d) such other distributions as shall be necessary to
satisfy the requirements of chapter 11 of the Bankruptcy Code. The manner and
treatment of each Allowed Secured Claim shall be determined by the Debtors, in
their sole and absolute discretion, on or before the Confirmation Date, and upon
notice to each Creditor holding a Secured Claim.
ARTICLE VII
PROVISION FOR TREATMENT OF BANK CLAIMS (CLASS 3)
7.1 Allowance of Bank Claims: On the Effective Date, the Bank Claims shall
be deemed allowed in the aggregate amount of Eight Hundred Fifty Million Dollars
($850,000,000.00) plus accrued and unpaid interest relating to the period up to
but not including the Petition Date.
7.2 Treatment of Allowed Bank Claims: Commencing on the Effective Date,
each holder of an Allowed Bank Claim shall be entitled to receive distributions
in an amount equal to (a) such holder's Pro Rata Share of the Bank Cash Amount,
and (b) the aggregate number of Litigation Trust Interests equal to such
holder's Pro Rata Share of eight million five hundred thousand (8,500,000)
Litigation Trust Interests.
ARTICLE VIII
PROVISION FOR TREATMENT OF SENIOR NOTE
CLAIMS (CLASS 4)
8.1 Allowance of Senior Note Claims: On the Effective Date, the Senior
Note Claims arising under or relating to the 9.35% Notes and the 7.7% Notes
shall be deemed allowed in the aggregate amounts of One Hundred Twenty-Five
Million Dollars ($125,000,000.00) and One Hundred Million Dollars
($100,000,000.00), respectively, plus accrued and unpaid interest relating to
the period up to but not including the Petition Date.
8.2 Treatment of Allowed Senior Note Claims: Commencing on the Effective
Date, each holder of an Allowed Senior Note Claim shall be entitled to receive
distributions in an amount equal to (a) such
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holder's Pro Rata Share of the Senior Note Cash Amount, and (b) the aggregate
number of Litigation Trust Interests equal to such holder's Pro Rata Share of
one million five hundred thousand (1,500,000) Litigation Trust Interests.
8.3 Payments to be Made to Senior Indenture Trustee: The payments and
distributions to be made under the Plan to holders of Allowed Senior Note Claims
shall be made to the Senior Indenture Trustee, which, subject to any rights or
claims of the Senior Indenture Trustee (such as claims for fees and
reimbursement of expenses, including the fees and expenses of its advisors and
counsel) under the Senior Note Indenture, shall transmit such payments and
distributions to holders of such Allowed Senior Note Claims. All payments to
holders of Allowed Senior Note Claims shall only be made to such Creditors after
the surrender by such Creditor of the certificates representing such Senior Note
Claim, or in the event that such certificate is lost, stolen, mutilated or
destroyed, delivery of evidence satisfactory to the Senior Indenture Trustee and
Reorganized UC of the loss, theft, mutilation or destruction of such certificate
or, in Reorganized UC's sole discretion, an affidavit of such Creditor in
accordance with Article 8 of the Uniform Commercial Code, or a surety bond, the
amount and form of which shall be satisfactory to the Senior Indenture Trustee
and Reorganized UC, from a surety company satisfactory to the Senior Indenture
Trustee and Reorganized UC. Upon surrender of such certificates, the Senior
Indenture Trustee shall cancel such Senior Notes and deliver such cancelled
Senior Notes to Reorganized UC, or otherwise dispose of same as Reorganized UC
may reasonably request. As soon as practicable after (a) surrender of
certificates evidencing Allowed Senior Note Claims, the Senior Indenture Trustee
shall distribute to the holders thereof such holder's Pro Rata Share in
accordance with the respective rights of the Senior Indenture Trustee and such
holder under the terms of the Senior Notes Indenture. If such Creditor has not
complied with the provisions hereof within one (1) year following the Effective
Date, such Creditor shall be deemed to have no further Claim against the
Debtors, the Debtors' estates or Reorganized UC. As soon as practicable after
the date which is one (1) year following the Effective Date of the Plan, the
Senior Indenture Trustee shall deliver the distributions which a Creditor
holding an Allowed Senior Note Claim would have received had such Creditor
surrendered such certificate evidencing such Senior Note Claim to Reorganized
UC, the Senior Indenture Trustee shall have no further responsibility with
respect to the Senior Indenture or the provisions of the Plan.
8.4 Closing of Transfer Ledgers for Senior Notes: At the close of business
on the Record Date, the transfer ledgers for the Senior Notes shall be closed,
and thereafter there shall be no further registrations or other changes in the
holders of any of the Senior Notes on the books of United Companies (or of any
indenture trustee, transfer agents or registrars it may have employed in
connection therewith), and the Debtors shall have no obligation to recognize any
transfer of the Senior Notes occurring thereafter (but shall be entitled instead
to recognize and deal with, for all purposes under the Plan, except as otherwise
provided herein, only those holders reflected on its books as of the Effective
Date).
ARTICLE IX
PROVISIONS FOR ALLOWANCE AND TREATMENT OF
BORROWER LITIGATION CLAIMS (CLASS 5)
9.1 Treatment of Borrower Litigation Claims: Commencing on the Effective
Date, each holder of an Allowed Borrower Litigation Claim shall be entitled to
receive distributions of Cash (i) in an amount equal to the asserted amount of
such holder's Claim up to One Thousand Dollars ($1,000.00) or if such Claim is
in excess of One Thousand Dollars ($1,000.00), and provided such holder agrees
to reduce such Claim to One Thousand Dollars ($1,000.00), the amount of such
Claim as reduced or (ii) from the Borrower Settlement Trust as and when such
Borrower Litigation Claim becomes an Allowed Borrower Litigation Claim. The
receipt and acceptance of distributions under the Plan by a holder of a Borrower
Litigation Claim or its successors or assigns shall constitute a full release
and waiver of any and all claims which have been or may have been asserted for
actions arising from or related to the origination or servicing of loans, moneys
advanced or mortgages issued by the Debtors, including, without limitation,
claims against the Debtors' successors and assigns for actions arising from or
related to the period prior to the Confirmation Date.
9.2 Mandatory Arbitration of Borrower Litigation Claims: In the event that
(a) a Borrower Litigation Claim is not resolved prior to the Effective Date and
the holder thereof does not receive distributions in accordance with the
provisions of Section 9.1 of the Plan or (b) a holder of a Borrower Litigation
Claim in excess of
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One Thousand Dollars ($1,000.00) elects not to reduce such Borrower Litigation
Claim to an amount equal to One Thousand Dollars ($1,000.00), in accordance with
the provisions of the Borrower Settlement Trust Agreement and the Confirmation
Order, such holder's Borrower Litigation Claim, wherever located, shall be
transferred to an arbitration panel located in or associated with the United
States District Court for the Middle District of Louisiana for binding
arbitration to determine the validity and amount of such Borrower Litigation
Claim and such arbitration panel shall have sole and exclusive jurisdiction to
determine the validity and amount of such Borrower Litigation Claim; provided,
however, nothing contained herein limits, or in any way is intended to limit,
Reorganized UC's ability to compromise and settle any Borrower Litigation Claim
in accordance with the provisions of Section 26.1 of the Plan.
9.3 Foreclosure Actions. To the extent that the holder of a Borrower
Litigation Claim (i) has asserted such Borrower Litigation Claim in the context
of, and as a counterclaim to, a foreclosure action commenced by the Debtors and
(ii) receives a distribution under the Plan pursuant to Sections 9.1 or 9.2
thereof, such holder of a Borrower Litigation Claim shall be deemed to have
received such distribution in full and complete satisfaction of any Borrower
Litigation Claim that such holder may have against any of the Debtors and their
successors and assigns and in consideration for the entry of a judgment in favor
of the Debtors in connection with such foreclosure action.
ARTICLE X
PROVISION FOR TREATMENT OF
GENERAL UNSECURED CLAIMS (CLASS 6)
10.1 Treatment of General Unsecured Claims: Commencing on the Effective
Date, each holder of an Allowed General Unsecured Claim shall be entitled to
receive distributions in an aggregate amount equal to thirty percent (30%) of
such holder's Allowed General Unsecured Claim.
10.2 Allowed Claims of One Thousand Dollars or More: Notwithstanding the
provisions of Section 10.1 of the Plan, any holder of an Allowed General
Unsecured Claim whose Allowed General Unsecured Claim is more than One Thousand
Dollars ($1,000.00), and who elects to reduce the amount of such Allowed Claim
to One Thousand Dollars ($1,000.00), shall, at such holder's option, be entitled
to receive, based on such Allowed Claim as so reduced, distributions pursuant to
Article XI hereof, in full settlement, satisfaction, release and discharge of
such Allowed Claim. Such election must be made on the Ballot and be received by
the Debtors on or prior to the Ballot Date. Any election made after the Ballot
Date shall not be binding upon the Debtors unless the Ballot Date is expressly
waived, in writing, by the Debtors.
ARTICLE XI
PROVISIONS FOR TREATMENT OF CONVENIENCE
CLAIMS (CLASS 7)
11.1 Treatment of Convenience Claims: On the Effective Date, each holder
of an Allowed Convenience Claim shall receive Cash in an amount equal to one
hundred percent (100%) of such Allowed Convenience Claim.
ARTICLE XII
PROVISION FOR TREATMENT OF SUBORDINATED DEBENTURE
CLAIMS (CLASS 8)
12.1 Treatment of Allowed Subordinated Debenture Claims: Each holder of an
Allowed Subordinated Debenture Claim shall receive no distribution for and on
account of such Claim, and, on the Effective Date, all documents and instruments
evidencing such Subordinated Debenture Claims, including, without limitation,
the 8.375% Notes, shall be deemed cancelled and of no force and effect.
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ARTICLE XIII
PROVISION FOR TREATMENT OF LENDING
SUBORDINATED DEBENTURE CLAIMS (CLASS 8A)
13.1 Treatment of Lending Subordinated Debenture Claims: Each holder of an
Allowed Lending Subordinated Debenture Claim shall receive no distribution for
and on account of such Claim, and, on the Effective Date, all documents and
instruments evidencing such Lending Subordinated Debenture Claim, including,
without limitation, the Lending Subordinated Debentures, shall be deemed
cancelled and of no force and effect.
ARTICLE XIV
PROVISION FOR TREATMENT OF PRIDE EQUITY INTERESTS (CLASS 9)
14.1 Treatment of Pride Equity Interests: On the Effective Date, all Pride
Equity Interests shall be deemed extinguished and the certificates and all other
documents representing such Equity Interests shall be deemed cancelled and of no
force and effect.
ARTICLE XV
PROVISION FOR TREATMENT OF STATUTORILY SUBORDINATED CLAIMS (CLASS 10A)
AND UNITED COMPANIES COMMON EQUITY INTERESTS (CLASS 10B)
15.1 Treatment of Statutorily Subordinated Claims: Each holder of an
Allowed Statutorily Subordinated Claim shall receive no distribution for or on
account of such Claim and, on the Effective Date, such Claim shall be deemed
extinguished against the Debtors and their chapter 11 estates.
15.2 Cancellation of Existing Equity Interests: On the Effective Date, all
United Companies Equity Interests shall be deemed extinguished and the
certificates and all other documents representing such Equity Interests shall be
deemed cancelled and of no force and effect.
ARTICLE XVI
PROVISION FOR TREATMENT OF ADOBE
COMMON EQUITY INTERESTS (CLASS 11)
16.1 Treatment of Adobe Common Equity Interest: Except as provided in
Article II of the Plan, the Equity Interests represented by Adobe Common Equity
Interests shall be unimpaired pursuant to section 1124 of the Bankruptcy Code by
leaving unaltered the legal and equitable rights to which such Equity Interests
entitle the holder thereof.
ARTICLE XVII
PROVISION FOR TREATMENT OF ADOBE FINANCIAL
COMMON EQUITY INTERESTS (CLASS 12)
17.1 Treatment of Adobe Financial Common Equity Interest: Except as
provided in Article II of the Plan, the Equity Interests represented by Adobe
Financial Common Equity Interests shall be unimpaired pursuant to section 1124
of the Bankruptcy Code by leaving unaltered the legal and equitable rights to
which such Equity Interests entitle the holder thereof.
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ARTICLE XVIII
PROVISION FOR TREATMENT OF GINGER MAE
COMMON EQUITY INTERESTS (CLASS 13)
18.1 Treatment of Ginger Mae Common Equity Interests: Except as provided
in Article II of the Plan, the Equity Interests represented by Ginger Mae Common
Equity Interests shall be unimpaired pursuant to section 1124 of the Bankruptcy
Code by leaving unaltered the legal and equitable rights to which such Equity
Interests entitle the holder thereof.
ARTICLE XIX
PROVISION FOR TREATMENT OF GOPHER EQUITY
COMMON EQUITY INTERESTS (CLASS 14)
19.1 Treatment of Gopher Equity Common Equity Interests: Except as
provided in Article II of the Plan, the Equity Interests represented by Gopher
Equity Common Equity Interests shall be unimpaired pursuant to section 1124 of
the Bankruptcy Code by leaving unaltered the legal and equitable rights to which
such Equity Interests entitle the holder thereof.
ARTICLE XX
PROVISION FOR TREATMENT OF PELICAN
COMMON EQUITY INTERESTS (CLASS 15)
20.1 Treatment of Pelican Common Equity Interests: Except as provided in
Article II of the Plan, the Equity Interests represented by Pelican Common
Equity Interests shall be unimpaired pursuant to section 1124 of the Bankruptcy
Code by leaving unaltered the legal and equitable rights to which such Equity
Interests entitle the holder thereof.
ARTICLE XXI
PROVISION FOR TREATMENT OF SOUTHERN MORTGAGE
COMMON EQUITY INTERESTS (CLASS 16)
21.1 Treatment of Southern Mortgage Common Equity Interests: Except as
provided in Article II of the Plan, the Equity Interests represented by Southern
Mortgage Common Equity Interests shall be unimpaired pursuant to section 1124 of
the Bankruptcy Code by leaving unaltered the legal and equitable rights to which
such Equity Interests entitle the holder thereof.
ARTICLE XXII
PROVISION FOR TREATMENT OF UNICOR
COMMON EQUITY INTERESTS (CLASS 17)
22.1 Treatment of Unicor Common Equity Interests: Except as provided in
Article II of the Plan, the Equity Interests represented by Unicor Common Equity
Interests shall be unimpaired pursuant to section 1124 of the Bankruptcy Code by
leaving unaltered the legal and equitable rights to which such Equity Interests
entitle the holder thereof.
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ARTICLE XXIII
PROVISION FOR TREATMENT OF UNITED FUNDING
COMMON EQUITY INTERESTS (CLASS 18)
23.1 Treatment of United Funding Common Equity Interests: Except as
provided in Article II of the Plan, the Equity Interests represented by United
Funding Common Equity Interests shall be unimpaired pursuant to section 1124 of
the Bankruptcy Code by leaving unaltered the legal and equitable rights to which
such Equity Interests entitle the holder thereof.
ARTICLE XXIV
PROVISION FOR TREATMENT OF UNITED LENDING CORP.
COMMON EQUITY INTERESTS (CLASS 19)
24.1 Treatment of United Lending Corp. Common Equity Interests: Except as
provided in Article II of the Plan, the Equity Interests represented by United
Lending Corp. Common Equity Interests shall be unimpaired pursuant to section
1124 of the Bankruptcy Code by leaving unaltered the legal and equitable rights
to which such Equity Interests entitle the holder thereof.
ARTICLE XXV
PROVISION FOR TREATMENT OF UNITED LENDING GROUP
COMMON EQUITY INTERESTS (CLASS 20)
25.1 Treatment of United Lending Group Common Equity Interests: Except as
provided in Article II of the Plan, the Equity Interests represented by United
Lending Group Common Equity Interests shall be unimpaired pursuant to section
1124 of the Bankruptcy Code by leaving unaltered the legal and equitable rights
to which such Equity Interests entitle the holder thereof.
ARTICLE XXVI
PROVISION FOR TREATMENT OF UNITED CREDIT CARD
COMMON EQUITY INTERESTS (CLASS 21)
26.1 Treatment of United Credit Card Common Equity Interests: Except as
provided in Article II of the Plan, the Equity Interests represented by United
Credit Card Common Equity Interests shall be unimpaired pursuant to section 1124
of the Bankruptcy Code by leaving unaltered the legal and equitable rights to
which such Equity Interests entitle the holder thereof.
ARTICLE XXVII
PROVISIONS FOR TREATMENT OF DISPUTED CLAIMS UNDER THE PLAN
27.1 Objections to Claims; Prosecution of Disputed Claims: The Debtors'
Reorganized UC or the Plan Administrator shall object to the allowance of Claims
or Equity Interests filed with the Bankruptcy Court with respect to which they
dispute liability or allowance in whole or in part. All objections shall be
litigated to Final Order; provided, however, that Reorganized UC (within such
parameters as may be established by the Board of Directors of Reorganized UC)
shall have the authority to file, settle, compromise or withdraw any objections
to Claims or Equity Interests, without approval of the Bankruptcy Court. Unless
otherwise ordered by the Bankruptcy Court, the Debtors' Reorganized UC or the
Plan Administrator shall file and serve all objections to Claims or Equity
Interests as soon as practicable, but in no event later than the Effective Date
or such later date as may be approved by the Bankruptcy Court.
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27.2 Estimation of Claims: The Debtors' Reorganized UC or the Plan
Administrator may at any time request that the Bankruptcy Court estimate any
contingent or Disputed Claim pursuant to section 502(c) of the Bankruptcy Code
regardless of whether the Debtors' Reorganized UC or the Plan Administrator
previously have objected to such Claim or whether the Bankruptcy Court has ruled
on any such objection, and the Bankruptcy Court will retain jurisdiction to
estimate any Claim at any time during litigation concerning any objection to any
Claim, including, without limitation, during the pendency of any appeal relating
to any such objection. Subject to the provisions of section 502(j) of the
Bankruptcy Code, in the event that the Bankruptcy Court estimates any contingent
or Disputed Claim, the amount so estimated shall constitute the allowed amount
of such Claim. If the estimated amount constitutes a maximum limitation on the
amount of such Claim, the Debtors' Reorganized UC or the Plan Administrator may
pursue supplementary proceedings to object to the allowance of such Claim. All
of the aforementioned objection, estimation and resolution procedures are
intended to be cumulative and not necessarily exclusive of one another. Claims
may be estimated and subsequently compromised, settled, withdrawn or resolved by
any mechanism approved by the Bankruptcy Court.
27.3 Payments and Distributions on Disputed Claims: At such time as a
Disputed Claim becomes, in whole or in part, an Allowed Claim, the Plan
Administrator shall distribute to the holder thereof the distributions, if any,
to which such holder is then entitled under the Plan. Such distribution, if any,
shall be made as soon as practicable after the date that the order or judgment
of the Bankruptcy Court allowing such Disputed Claim becomes a Final Order but
in no event more than thirty (30) days thereafter. No interest shall be paid on
Disputed Claims that later become Allowed or with respect to any distribution to
such holder. No distribution shall be made with respect to all or any portion of
any Disputed Claim pending the entire resolution thereof in the manner
prescribed in Section 27.1 hereof.
ARTICLE XXVIII
THE LITIGATION TRUST
28.1 Establishment of the Trust: On the Effective Date, the Debtors, on
their own behalf and on behalf of holders of Allowed Claims in Classes 3 and 4
shall execute the Litigation Trust Agreement and shall take all other steps
necessary to establish the Litigation Trust. On the Effective Date, and in
accordance with and pursuant to the terms of Section 28.4 of the Plan, the
Debtors shall transfer to the Litigation Trust all of their right, title, and
interest in the Litigation Trust Claims. In connection with the above-described
rights and causes of action, any attorney-client privilege, work-product
privilege, or other privilege or immunity attaching to any documents or
communications (whether written or oral) transferred to the Litigation Trust
shall vest in the Litigation Trustee and its representatives, and the Debtors
and the Litigation Trustee are authorized to take all necessary actions to
effectuate the transfer of such privileges.
28.2 Purpose of the Litigation Trust: The Litigation Trust shall be
established for the sole purpose of liquidating its assets, in accordance with
Treasury Regulation Section 301.7701-4(d), with no objective to continue or
engage in the conduct of a trade or business.
28.3 Funding Expenses of the Litigation Trust: In accordance with the
Litigation Trust Agreement and any agreements entered into in connection
therewith, on the Effective Date, the Debtors shall transfer One Hundred
Thousand Dollars ($100,000.00) to the Litigation Trust. The Debtors and
Reorganized UC shall have no further obligation to provide any funding with
respect to the Litigation Trust.
28.4 Transfer of Assets:
(a) The transfer of the Litigation Trust Claims to the Litigation
Trust shall be made, as provided herein, for the benefit of the holders of
Allowed Claims in 3 and 4 in each case, only to the extent such holders in such
Classes are entitled to distributions under the Plan. In this regard, in partial
satisfaction of Allowed Claims in Classes 3 and 4, the Litigation Trust Claims
will be transferred to such holders of Allowed Claims and Allowed Equity
Interests, to be held by the Debtors on their behalf. Immediately thereafter, on
behalf of the holders of Allowed Claims in Classes 3 and 4, respectively, the
Debtors shall transfer such Litigation Trust Claims to the Litigation Trust in
exchange for Litigation Trust Interests for the benefit of holders of Allowed
Claims in Classes 3
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and 4, respectively, in accordance with the Plan. Upon the transfer of the
Litigation Trust Claims, the Debtors shall have no interest in or with respect
to the Litigation Trust Claims or the Litigation Trust.
(b) For all federal income tax purposes, all parties (including,
without limitation, the Debtors, the Litigation Trustee and the beneficiaries of
the Litigation Trust) shall treat the transfer of assets to the Litigation Trust
in accordance with the terms of the Plan, as a transfer to the holders of
Allowed Claims in Classes 3 and 4, respectively, followed by a transfer by such
holders to the Litigation Trust and the beneficiaries of the Litigation Trust
shall be treated as the grantors and owners thereof.
28.5 Valuation of Assets: As soon as possible after the Effective Date,
but in no event later than thirty (30) days thereafter, the Litigation Trust
Board shall inform, in writing, the Litigation Trustee of the value of the
assets transferred to the Litigation Trust, based on the good faith
determination of the Litigation Trust Board, and the Litigation Trustee shall
apprise, in writing, the beneficiaries of the Litigation Trust of such
valuation. The valuation shall be used consistently by all parties (including
the Debtors, Reorganized UC, the Litigation Trustee and the beneficiaries of the
Litigation Trust) for all federal income tax purposes.
28.6 Litigation of Assets; Responsibilities of Litigation Trustee:
(a) The Litigation Trustee, upon direction by the Litigation Trust
Board and the exercise of their collective reasonable business judgment, shall,
in an expeditious but orderly manner, liquidate and convert to Cash the assets
of the Litigation Trust, make timely distributions and not unduly prolong the
duration of the Litigation Trust. The liquidation of the Litigation Trust Claims
may be accomplished either through the prosecution, compromise and settlement,
abandonment or dismissal of any or all claims, rights or causes of action, or
otherwise. The Litigation Trustee, upon direction by the Litigation Trust Board,
shall have the absolute right to pursue or not to pursue any and all claims,
rights, or causes of action, as it determines is in the best interests of the
beneficiaries of the Litigation Trust, including, without limitation, taking
into account the indemnification and contribution obligations of Reorganized UC
and the diminution in value of Reorganized UC, and consistent with the purposes
of the Litigation Trust, and shall have no liability for the outcome of its
decision. The Litigation Trustee may incur any reasonable and necessary expenses
in liquidating and converting the assets to Cash.
(b) The Litigation Trustee shall be named in the Confirmation Order
or in the Litigation Trust Agreement and shall have the power (i) to prosecute
for the benefit of the Litigation Trust all claims, rights and causes of action
transferred to the Litigation Trust (whether such suits are brought in the name
of the Litigation Trust or otherwise), and (ii) to otherwise perform the
functions and take the actions provided for or permitted herein or in any other
agreement executed by the Litigation Trustee pursuant to the Plan. Any and all
proceeds generated from such claims, rights, and causes of action shall be the
property of the Litigation Trust.
28.7 Investment Powers: The right and power of the Litigation Trustee to
invest assets transferred to the Litigation Trust, the proceeds thereof, or any
income earned by the Litigation Trust, shall be limited to the right and power
to invest such assets (pending periodic distributions in accordance with Section
38.8 of the Plan) in Cash Equivalents; provided, however, that (a) the scope of
any such permissible investments shall be limited to include only those
investments, or shall be expanded to include any additional investments, as the
case may be, that a liquidating trust, within the meaning of Treasury Regulation
Section 301.7701-4(d) may be permitted to hold, pursuant to the Treasury
Regulations, or any modification in the IRS guidelines, whether set forth in IRS
rulings, other IRS pronouncements or otherwise, and (b) the Litigation Trustee
may expend the assets of the Litigation Trust (i) as reasonably necessary to
meet contingent liabilities and to maintain the value of the assets of the
Litigation Trust during liquidation, (ii) to pay reasonable administrative
expenses (including, but not limited to, any taxes imposed on the Litigation
Trust or fees and expenses in connection with litigation), and (iii) to satisfy
other liabilities incurred or assumed by the Litigation Trust (or to which the
assets are otherwise subject) in accordance with the Plan or the Litigation
Trust Agreement; and, provided, further, that, under no circumstances, shall the
Litigation Trust segregate the assets of the Litigation Trust on the basis of
classification of the holders of Litigation Trust Interests, other than with
respect to distributions to be made on account of Disputed Claims and Disputed
Equity Interests in accordance with the provisions hereof.
28.8 Annual Distribution; Withholding: The Litigation Trustee shall
distribute at least annually to the holders of Litigation Trust Interests all
net cash income plus all net cash proceeds from the
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liquidation of assets (including as Cash for this purpose, all Cash
Equivalents); provided, however, that the Litigation Trust may retain such
amounts (i) as are reasonably necessary to meet contingent liabilities and to
maintain the value of the assets of the Litigation Trust during liquidation,
(ii) to pay reasonable administrative expenses (including any taxes imposed on
the Litigation Trust or in respect of the assets of the Litigation Trust or the
escrow created in accordance with Section 28.14 hereof), and (iii) to satisfy
other liabilities incurred or assumed by the Litigation Trust (or to which the
assets are otherwise subject) in accordance with the Plan or the Litigation
Trust Agreement. All such distributions shall be pro rata based on the number of
Litigation Trust Interests held by a holder compared with the aggregate number
of Litigation Trust Interests outstanding, subject to the terms of the Plan and
the Litigation Trust Agreement; provided, further, that of the net amount
distributable, the Litigation Trustee shall transfer to an escrow, in accordance
with Section 28.14 hereof, such amounts as would be distributable in respect of
Disputed Claims (treating such Claims, for this purpose, as if they were Allowed
Claims). The Litigation Trustee may withhold from amounts distributable to any
Person any and all amounts, determined in the Litigation Trustee's reasonable
sole discretion, to be required by any law, regulation, rule, ruling, directive
or other governmental requirement.
28.9 Reporting Duties:
(a) Federal Income Tax: Subject to definitive guidance from the IRS
or a court of competent jurisdiction to the contrary (including the receipt by
the Litigation Trustee of a private letter ruling if the Litigation Trustee so
requests one, or the receipt of an adverse determination by the IRS upon audit
if not contested by the Litigation Trustee), the Litigation Trustee shall file
returns for the Litigation Trust as a grantor trust pursuant to Treasury
Regulation Section 1.671-4(a). The Litigation Trustee shall also annually send
to each holder of a Litigation Trust Interest a separate statement setting forth
the holder's share of items of income, gain, loss, deduction or credit and will
instruct all such holders to report such items on their federal income tax
returns.
(b) Allocations of Litigation Trust Taxable Income: Allocations of
Litigation Trust taxable income shall be determined by reference to the manner
in which an amount of cash equal to such taxable income would be distributed
(without regard to any restrictions on distributions described herein) if,
immediately prior to such deemed distribution, the Litigation Trust had
distributed all of its other assets (valued for this purpose at their tax book
value) to the holders of the Litigation Trust Interests (treating any holder of
a Disputed Claim, for this purpose, as a current holder of a Litigation Trust
Interest entitled to distributions), taking into account all prior and
concurrent distributions from the Litigation Trust (including all distributions
held in escrow pending the resolution of Disputed Claims). Similarly, taxable
loss of the Litigation Trust will be allocated by reference to the manner in
which an economic loss would be borne immediately after a liquidating
distribution of the remaining Litigation Trust Claims. The tax book value of the
Litigation Trust Claims for this purpose shall equal their fair market value on
the Effective Date or, if later, the date such assets were acquired by the
Litigation Trust, adjusted in either case in accordance with tax accounting
principles prescribed by the IRC, the regulations and other applicable
administrative and judicial authorities and pronouncements.
(c) Other: The Litigation Trustee shall file (or cause to be filed)
any other statements, returns or disclosures relating to the Litigation Trust,
including, without limitation, all statements, returns and disclosures relating
to the escrow to be established pursuant to Section 28.14 hereof, that are
required by any governmental unit.
28.10 Trust Implementation: On the Effective Date, the Litigation Trust
will be established and become effective for the benefit of Allowed Claims in
Classes 3 and 4. The Litigation Trust Agreement shall be filed in the Plan
Supplement and shall contain provisions customary to trust agreements utilized
in comparable circumstances, including, but not limited to, any and all
provisions necessary to ensure the continued treatment of the Litigation Trust
as a grantor trust for federal income tax purposes. All parties (including the
Debtors, the Litigation Trustee and holders of Allowed Claims in Classes 3 and 4
shall execute any documents or other instruments as necessary to cause title to
the applicable assets to be transferred to the Litigation Trust.
28.11 Registry of Beneficial Interests: The Litigation Trustee shall
maintain a registry of the holders of Litigation Trust Interests.
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28.12 Termination: The Litigation Trust will terminate no later than the
third (3rd) anniversary of the Effective Date; provided, however, that, on or
prior to the date six (6) months prior to such termination, the Bankruptcy
Court, upon motion by a party in interest, may extend the term of the Litigation
Trust if it is necessary to the liquidation of the Litigation Trust Claims.
Notwithstanding the foregoing, multiple extensions can be obtained so long as
Bankruptcy Court approval is obtained at least six (6) months prior to the
expiration of each extended term; provided, however, that the aggregate of all
such extensions shall not exceed three (3) years, unless the Litigation Trustee
receives a favorable ruling from the IRS that any further extension would not
adversely affect the status of the Litigation Trust as a grantor trust for
federal income tax purposes.
28.13 Net Litigation Trust Recovery/Affirmative Obligations:
(a) Net Judgment: Notwithstanding anything contained herein to the
contrary, in the event that a defendant in a litigation brought by the
Litigation Trustee for and on behalf of the Litigation Trust (i) is required by
a Final Order to make payment to the Litigation Trust (the "Judgment Amount"),
and (ii) has a right of setoff under section 553 of the Bankruptcy Code or
applicable non-bankruptcy law, has a claim for contribution or reimbursement or
has incurred costs and expenses which would give rise to an enforceable claim
against UC or Reorganized UC, as the case may be (the aggregate amount of all
such rights, claims, costs and expenses being referred to herein as the
"Indemnified/Contribution Amount"), (x) such defendant shall be obligated to pay
only the excess, if any, of the amount of the Judgment Amount over the
Indemnified/Contribution Amount, (y) none of the Litigation Trust, the holders
or beneficiaries of the Litigation Trust Interests shall be entitled to assert a
claim against the Debtors or Reorganized UC with respect to the
Indemnified/Contribution Amount, and (z) the Debtors and Reorganized UC shall
have no liability with respect to such Indemnified/Contribution Amount.
(b) Affirmative Obligations: Notwithstanding anything contained
herein to the contrary, in the event that a defendant in a litigation brought by
the Litigation Trustee for and on behalf of the Litigation Trust (1) has an
Indemnified/Contribution Amount and (2) the Indemnified/Contribution Amount is
in excess of the Judgment Amount, if any, (i) the Judgment Amount shall be
offset against the Indemnified/Contribution Amount and shall not be paid to the
Litigation Trust by such defendant, (ii) the Litigation Trust shall reimburse
Reorganized UC immediately for the payment of the difference between the
Indemnified/Contribution Amount and any Judgment Amount, (iii), none of the
Litigation Trust, the holders or beneficiaries of the Litigation Trust Interests
shall be entitled to assert a claim against the Debtors or Reorganized UC with
respect to the Indemnified/Contribution Amount, and (iv) the Debtors and
Reorganized UC shall have no liability with respect to such
Indemnified/Contribution Amount.
28.14 Escrow on Account of Disputed Claims:
(a) General: The Litigation Trustee shall maintain, in accordance
with the Litigation Trustee's powers and responsibilities under this Article
XXVIII and the Litigation Trust Agreement, an escrow of any distributable
amounts required to be set aside on account of Disputed Claims pursuant to
Section 28.8. Such amounts (net of any expenses, including any taxes, of the
escrow relating thereto) shall be distributed, as provided herein, as such
Disputed Claims are resolved by Final Order, and shall be distributable in
respect of such Litigation Trust Interests as such amounts would have been
distributable had the Disputed Claims been Allowed Claims as of the Effective
Date. There shall be distributed together with such amounts any net earnings of
the escrow related thereto. Distributions from the escrow shall be made at least
annually concurrent with other distributions from the Litigation Trust.
(b) Taxable Income of Litigation Trust Allocable to Disputed Claims:
As more fully set forth in Section 28.14(c), the escrow shall be responsible for
payment of certain taxes attributable to the taxable income of the Litigation
Trust allocable to Litigation Trust Interests relating to such Disputed Claims.
In the event, and to the extent the escrow has insufficient funds to pay such
taxes (or no escrow has been established at such time due to the absence of any
distributable proceeds pursuant to Section 28.8), such taxes shall be borne by
the Litigation Trust and either (i) reimbursed by the escrow from any subsequent
amounts transferred by the Litigation Trustee to the escrow pursuant to Section
28.8 hereof in respect of such Disputed Claims or (ii) to the extent such Claims
have subsequently been resolved, may be deducted from any increased amounts
distributable by the Litigation Trust as a result of the resolutions of such
Claims on a fair and equitable basis.
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(c) Tax Treatment of Escrow: Subject to definitive guidance from the
IRS or a court of competent jurisdiction to the contrary (including the receipt
by the Litigation Trustee of a private letter ruling if the Litigation Trustee
so requests one, or the receipt of an adverse determination by the IRS upon
audit if not contested by the Litigation Trustee), and except as otherwise
provided in Section 28.9(d) hereof, the Litigation Trustee shall (i) treat the
escrow as a discreet trust for federal income tax purposes, consisting of
separate and independent shares to be established in respect of each Disputed
Claim, in accordance with the trust provisions of the IRC (Sections 641 et
seq.), (ii) treat as taxable income or loss of the escrow with respect to any
given taxable year the portion of the taxable income or loss of the Litigation
Trust that would have been allocated to the holders of Disputed Claims had such
Claims been Allowed on the Effective Date (but only for the portion of the
taxable year with respect to which such Claims are unresolved), (iii) treat as a
distribution from the escrow any increased amounts distributed by the Litigation
Trust as a result of any Disputed Claims resolved earlier in the taxable year,
to the extent such distributions relate to taxable income or loss of the escrow
determined in accordance with the provisions hereof, and (iv) to the extent
permitted by applicable law, shall report consistent with the foregoing for
state and local income tax purposes. All holders of Allowed Claims in Classes 3
and 4 shall report, for tax purposes, consistent with the foregoing.
28.15 Non-Transferability: Upon issuance thereof, the Litigation Trust
Interests shall be non-transferable except through descent or distribution.
ARTICLE XXIX
PROSECUTION OF CLAIMS HELD BY THE DEBTORS
29.1 Prosecution of Claims: Except with respect to Litigation Trust
Claims, from and after the Confirmation Date, Reorganized UC shall, as a
representative of the estates of the Debtors, litigate any avoidance or recovery
actions under sections 544, 545, 547, 548, 549, 550, 551 and 553 of the
Bankruptcy Code and any other causes of action, rights to payments of claims
that belong to the Debtors or Debtors in Possession, that may be pending on the
Confirmation Date or instituted by Debtors thereafter, to a Final Order, and
Reorganized UC may compromise and settle such claims, without approval of the
Bankruptcy Court (but with approval of, or within parameters established by, the
Board of Directors of Reorganized UC). The net proceeds of any such litigation
or settlement (after satisfaction of all costs and expenses incurred in
connection therewith) shall be remitted to the Disbursing Agent for inclusion in
Creditor Cash.
29.2 Net Payment by Defendants: Notwithstanding anything to the contrary
herein, in the event that a defendant in a litigation of the kind described in
Section 29.1 hereof is required by a Final Order to make payment (a
"Disgorgement Payment") to Reorganized UC, and such Disgorgement Payment (if so
made) would give rise to a Claim, (a) such defendant will be required to pay (a
"Net Payment") in Cash (and will have no Claim in respect thereof) only the
excess, if any, of (i) the amount of such Disgorgement Payment over (ii) the
fair market value of the distributions ("Initial Distributions") on such Claim
pursuant to this Plan that would have been received by such defendant if such
defendant had made such Disgorgement Payment (which fair market value shall be
determined as of the date of such Net Payment by agreement between Reorganized
UC and such defendant, or by Final Order) and (b) if any distributions
("Subsequent Distributions") are made hereunder after such defendant makes such
Net Payment, such defendant shall receive such defendant's Pro Rata Share of
such Subsequent Distributions (or, at Reorganized UC's election, the fair market
value thereof determined as of the date of such Subsequent Distributions by
agreement between Reorganized UC and such defendant, or by Final Order), which
Pro Rata Share shall be calculated as if such defendant had made such
Disgorgement Payment and received Initial Distributions in respect thereof.
ARTICLE XXX
ACCEPTANCE OR REJECTION OF PLAN; EFFECT OF REJECTION
BY ONE OR MORE CLASSES OF CLAIMS OR EQUITY INTEREST
30.1 Impaired Classes to Vote: Each holder of a Claim or Equity Interest
in an impaired Class shall be entitled to vote separately to accept or reject
the Plan.
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30.2 Acceptance by Class of Creditors and Holders of Equity Interests: An
impaired Class of holders of Claims shall have accepted the Plan if the Plan is
accepted by at least two-thirds (2/3) in dollar amount and more than one-half
(1/2) in number of the Allowed Claims of such Class that have voted to accept or
reject the Plan. An impaired Class of holders of Equity Interests shall have
accepted the Plan if the Plan is accepted by at least two-thirds (2/3) in amount
of the Allowed Equity Interests of such Class that have voted to accept or
reject the Plan.
30.3 Cramdown: In the event that any impaired Class of Claims or Equity
Interests shall fail to accept the Plan in accordance with section 1129(a) of
the Bankruptcy Code, the Debtors reserves the right to request that the
Bankruptcy Court confirm the Plan in accordance with section 1129(b) of the
Bankruptcy Code or amend the Plan.
ARTICLE XXXI
IDENTIFICATION OF CLAIMS AND EQUITY INTERESTS
IMPAIRED AND NOT IMPAIRED BY THE PLAN
31.1 Impaired and Unimpaired Classes: Claims and Equity Interests in
Classes 1, 2, 12, 13, 14, 15, 16, 17, 18, 19, 20 and 21 of the Plan are not
impaired under the Plan. Claims and Equity Interests in Classes 3, 4, 5, 6, 8,
8A, 9 and 10 are impaired under the Plan.
31.2 Impaired Classes to Vote on Plan: The Claims included in Classes 3,
4, 5, 6, and 7 of the Plan are impaired and are therefore entitled to vote to
accept or reject the Plan. The Claims and Equity Interests included in Classes
8, 8A, 9 and 10 of the Plan are deemed to have rejected the Plan in accordance
with the provisions of section 1126(g) of the Bankruptcy Code.
31.3 Controversy Concerning Impairment: In the event of a controversy as
to whether any Class of Claims or Equity Interests is impaired under the Plan,
the Bankruptcy Court shall, after notice and a hearing, determine such
controversy.
ARTICLE XXXII
PROVISIONS FOR THE ESTABLISHMENT
AND MAINTENANCE OF DISBURSEMENT ACCOUNTS
32.1 Establishment of Disbursement Account: On or before the Effective
Date, the Debtors shall establish one or more segregated bank accounts in the
name of Reorganized UC as Disbursing Agent under the Plan, which accounts shall
be trust accounts for the benefit of Creditors pursuant to the Plan and utilized
solely for the investment and distribution of Cash consistent with the terms and
conditions of the Plan. On or before the Effective Date, the Debtors shall
deposit into such Disbursement Account(s) all Cash and Cash Equivalents of the
Debtors, less the sum of Fifteen Million Dollars ($15,000,000.00) or such other
amount reasonably determined by the Debtors on or prior to the Confirmation Date
as necessary to fund the ongoing operations of Reorganized UC during the period
up to and including the Transfer Date.
32.2 Maintenance of Disbursement Account(s): Disbursement Account(s) shall
be maintained at one or more domestic banks or financial institutions of
Reorganized UC's choice having a shareholder's equity or equivalent capital of
not less than One Hundred Million ($100,000,000.00). Reorganized UC shall invest
Cash in Disbursement Account(s) in Cash Equivalents; provided, however, that
sufficient liquidity shall be maintained in such account or accounts to (a) make
promptly when due all payments upon Disputed Claims if, as and when they become
Allowed Claims and (b) make promptly when due the other payments provided for in
the Plan.
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ARTICLE XXXIII
PROVISIONS REGARDING DISTRIBUTIONS
33.1 Time and Manner of Payments: Payments under the Plan shall be made to
each holder of an Allowed Unsecured Claim as follows:
(a) Initial Payments: On or as soon as practicable after the
Effective Date, the Disbursing Agent shall distribute, or cause to be
distributed, to the Plan Administrator on behalf of holders of Disputed Claims,
and to each holder of (i) an Allowed Bank Claim, (ii) an Allowed Senior Note
Claim, and (iii) an Allowed General Unsecured Claim, such Creditor's share, if
any, of Creditor Cash as determined pursuant to Articles VII, VIII and X hereof,
respectively.
(b) Quarterly Payments: On the first (1st) Business Day that is
after the close of one full calendar quarter following the date of the initial
Effective Date distributions, and, thereafter, on each first (1st) Business Day
following the close of calendar quarters, the Disbursing Agent shall distribute,
or cause to be distributed, to the Plan Administrator on behalf of holders of
Disputed Claims, and to each holder of (i) an Allowed Bank Claim, (ii) an
Allowed Senior Note Claim, and (iii) an Allowed General Unsecured Claim, an
amount equal to such Creditor's share, if any, of Creditor Cash as determined
pursuant to Articles VII, VIII and X hereof, until such time as there are not
longer any potential Creditor Cash.
33.2 Timeliness of Payments: Any payments or distributions to be made by
the Debtors pursuant to the Plan shall be deemed to be timely made if made
within twenty (20) days after the dates specified in the Plan. Whenever any
distribution to be made under this Plan shall be due on a day other than a
Business Day, such distribution shall instead be made, without interest, on the
immediately succeeding Business Day, but shall be deemed to have been made on
the date due.
33.3 Distributions by the Disbursing Agent: All distributions under the
Plan shall be made by the Disbursing Agent at the direction of the Plan
Administrator. The Disbursing Agent shall be deemed to hold all property to be
distributed hereunder in trust for the Persons entitled to receive the same. The
Disbursing Agent shall not hold an economic or beneficial interest in such
property.
33.4 Manner of Payment under the Plan: Unless the Entity receiving a
payment agrees otherwise, any payment in Cash to be made by Reorganized UC shall
be made, at the election of Reorganized UC, by check drawn on a domestic bank or
by wire transfer from a domestic bank.
33.5 Delivery of Distributions: Subject to the provisions of Rule 9010 of
the Bankruptcy Rules, and except as provided in Section 8.3 of the Plan,
distributions and deliveries to holders of Allowed Claims shall be made at the
address of each such holder as set forth on the Schedules filed with the
Bankruptcy Court unless superseded by the address set forth on proofs of claim
filed by such holders, or at the last known address of such a holder if no proof
of claim is filed or if the Debtors has been notified in writing of a change of
address.
33.6 Undeliverable Distributions:
(a) Holding of Undeliverable Distributions: If any distribution to
any holder is returned to Reorganized UC as undeliverable, no further
distributions shall be made to such holder unless and until Reorganized UC is
notified, in writing, of such holder's then-current address. Undeliverable
distributions shall remain in the possession of Reorganized UC until such time
as a distribution becomes deliverable. All Persons ultimately receiving
undeliverable Cash shall not be entitled to any interest or other accruals of
any kind. Nothing contained in the Plan shall require Reorganized UC to attempt
to locate any holder of an Allowed Claim or an Allowed Equity Interest.
(b) Failure to Claim Undeliverable Distributions: On or about the
second (2nd) anniversary of the Effective Date, Reorganized UC shall file a list
with the Bankruptcy Court setting forth the names of those Entities for which
distributions have been made hereunder and have been returned as undeliverable
as of the
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date thereof. Any holder of an Allowed Claim or an Allowed Equity Interest that
does not assert its rights pursuant to the Plan to receive a distribution within
three (3) years from and after the Effective Date shall have its Claim or Equity
Interest for such undeliverable distribution discharged and shall be forever
barred from asserting any such Claim or Equity Interest against Reorganized UC
or its property. In such case, any consideration held for distribution on
account of such Claim or Equity Interest shall revert to Reorganized UC.
33.7 Compliance with Tax Requirements/Allocation: To the extent
applicable, Reorganized UC shall comply with all tax withholding and reporting
requirements imposed on it by any governmental unit, and all distributions
pursuant to the Plan shall be subject to such withholding and reporting
requirements. For tax purposes, distributions received in respect of Allowed
Claims will be allocated first to the principal amount of such Claims, with any
excess allocated to unpaid accrued interest.
33.8 Time Bar to Cash Payments: Checks issued by Reorganized UC on account
of Allowed Claims shall be null and void if not negotiated within ninety (90)
days from and after the date of issuance thereof. Requests for reissuance of any
check shall be made directly to Reorganized UC by the holder of the Allowed
Claim with respect to which such check originally was issued. Any claim in
respect of such a voided check shall be made on or before the later of (a) the
second (2nd) anniversary of the Effective Date or (b) ninety (90) days after the
date of issuance of such check, if such check represents a final distribution
hereunder on account of such Claim. After such date, all Claims in respect of
voided checks shall be discharged and forever barred and Reorganized UC shall
retain all moneys related thereto.
33.9 Distributions After Effective Date: Distributions made after the
Effective Date to holders of Claims and Equity Interests that are not Allowed
Claims or Allowed Equity Interests as of the Effective Date, but which later
become Allowed Claims or Allowed Equity Interests, shall be deemed to have been
made on the Effective Date.
33.10 Set-Offs: Reorganized UC may, pursuant to section 553 of the
Bankruptcy Code or applicable nonbankruptcy law, set off against any Allowed
Claim or Allowed Equity Interest and the distributions to be made pursuant to
the Plan on account thereof (before any distribution is made on account of such
Claim), the claims, rights and causes of action of any nature that the Debtors
or Reorganized UC may hold against the holder of such Allowed Claim or Allowed
Equity Interest; provided, however, that neither the failure to effect such a
set-off nor the allowance of any Claim or Equity Interest hereunder shall
constitute a waiver or release by the Debtors or Reorganized UC of any such
claims, rights and causes of action that the Debtors or Reorganized UC may
possess against such holder; and, provided, further, that nothing contained
herein is intended to limit the rights of any Creditor or holder of an Equity
Interest to effectuate a setoff prior to the Effective Date in accordance with
the provisions of sections 362 and 553 of the Bankruptcy Code.
33.11 Termination of Certain Subordination Rights and Settlement of
Related Claims and Controversies: The classification and manner of satisfying
all Claims and Equity Interests under the Plan (i) take into consideration all
contractual, legal and equitable subordination rights, whether arising under
general principles of equitable subordination, sections 510(b) and (c) of the
Bankruptcy Code or otherwise, that a holder of a Claim or Equity Interest may
have against other Claim or Equity Interest holders with respect to any
distribution made pursuant to the Plan and (ii) are the result of discussions
between the Debtors and other parties in interest and take into account their
respective positions with respect to (a) the extent and validity of the Guaranty
and (b) the objections of the Banks to the treatment of the Debtors' chapter 11
estates as substantively consolidated for purposes of the Plan, on the grounds
that such treatment would result in severe prejudice to the Banks. Pursuant to
Bankruptcy Rule 9019 and in consideration for the distributions and other
benefits provided under the Plan, the provisions of this Section 33.11 shall
constitute a good faith compromise and settlement of all claims or controversies
relating to the contractual, legal and subordination rights that a holder of a
Bank Claim or a Senior Note Claim may have with respect to any Allowed Claim
with respect thereto, or any distribution to be made on account of such an
Allowed Claim. The entry of the Confirmation Order shall constitute the
Bankruptcy Court's approval of the compromise or settlement of all such claims
or controversies and the Bankruptcy Court's finding that such compromise or
settlement is in the best interests of the Debtors, Reorganized UC, and their
respective property and holders of Claims and is fair, equitable and reasonable.
With respect to all other Claims, including, without limitation, Lending
Subordinated Debenture Claims and Subordinated Debenture Claims, the provisions
of the Plan regarding distributions with respect thereto apply all applicable
contractual, legal and subordination rights
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that holders of Bank Claims and Senior Note Claims maintain and, from and after
the Effective Date, the holders of Allowed Bank Claims and Allowed Senior Note
Claims shall be entitled to rely upon the validity and enforceability of any
such provisions in accordance with the provisions of section 510(a) of the
Bankruptcy Code.
ARTICLE XXXIV
COMMITTEES
34.1 Creditors' Committee Composition and Term: From the Confirmation Date
up to and including the Effective Date, the members of the Creditors' Committee,
if any, appointed pursuant to section 1102 of the Bankruptcy Code, and their
duly appointed successors, shall continue to serve. Upon the disallowance by
Final Order of the Claim held by a Creditor that is a member of the Creditors'
Committee, such membership shall terminate and no replacement shall be
appointed. Upon the resignation, death or disability of a member of the
Creditors' Committee, the Creditor having appointed such member shall have the
right to designate a replacement. In the event such Creditor shall fail to
designate a replacement, no other replacement may be appointed to the Creditors'
Committee. Members of the Creditors' Committee shall serve without compensation
but shall be entitled to reimbursement of their reasonable out-of-pocket
expenses which are attributable to their attendance at Creditors' Committee
meetings. The Creditors' Committee shall be entitled to retain legal counsel and
such other professionals as may be authorized by the Bankruptcy Court, the fees
and expenses of which shall be entitled to payment as Administrative Expense
Claims. On the Effective Date, the Creditors' Committee shall be dissolved and
the members thereof and the professionals retained by the Creditors' Committee
in accordance with section 1103 of the Bankruptcy Code shall be released and
discharged from their respective fiduciary obligations.
34.2 Equity Committee Term and Fees: From the Confirmation Date up to and
including the Effective Date, the members of the Equity Committee, if any,
appointed pursuant to section 1102 of the Bankruptcy Code, and their duly
appointed successors, shall continue to serve. Members of the Equity Committee
shall serve without compensation but shall be entitled to reimbursement of their
reasonable out-of-pocket expenses which are attributable to their attendance at
Equity Committee meetings. The Equity Committee shall be entitled to retain
legal counsel and such other professionals as may be authorized by the
Bankruptcy Court, the fees and expenses of which shall be entitled to payment as
Administrative Expense Claims. On the Effective Date, the Equity Committee shall
be dissolved and the members thereof and the professionals retained by the
Equity Committee in accordance with section 327 of the Bankruptcy Code shall be
released and discharged from their respective fiduciary obligations, if the same
has not occurred prior to the Effective Date.
ARTICLE XXXV
EXECUTORY CONTRACTS AND UNEXPIRED LEASES
35.1 Rejection of Executory Contracts and Unexpired Leases: Any executory
contracts or unexpired leases which have not expired by their own terms on or
prior to the Effective Date, which have not been assumed and assigned or
rejected with the approval of the Bankruptcy Court, or which are not the subject
of a motion to assume the same pending as of the Effective Date shall be deemed
rejected by the Debtors in Possession on the Effective Date and the entry of the
Confirmation Order by the Bankruptcy Court shall constitute approval of such
rejections pursuant to sections 365(a) and 1123 of the Bankruptcy Code.
35.2 Cure of Defaults for Assumed Executory Contracts and Unexpired
Leases: Any monetary amounts required as cure payments on each executory
contract and unexpired lease to be assumed pursuant to the Plan shall be
satisfied, pursuant to section 365(b)(1) of the Bankruptcy Code, by payment of
the cure amount in Cash on the Effective Date or upon such other terms and dates
as the parties to such executory contracts or unexpired leases otherwise may
agree. In the event of a dispute regarding (a) the amount of any cure payment,
(b) the ability of the Debtors or any assignee to provide "adequate assurance of
future performance" (within the meaning of section 365 of the Bankruptcy Code)
under the contract or lease to be assumed or (c) any other matter pertaining to
assumption, the cure payments required by section 365(b)(1) of the Bankruptcy
Code shall be subject to the jurisdiction of the Bankruptcy Court and made
following the entry of a Final Order resolving such dispute.
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35.3 Rejection Damage Claims: Not later than ten (10) days prior to the
Confirmation Date, the Debtors shall file with the Bankruptcy Court a list of
executory contracts and unexpired leases to be assumed by the Debtors pursuant
to the Plan as of the Effective Date, and such executory contracts and unexpired
leases shall be deemed assumed as of the Effective Date. If the rejection of an
executory contract or unexpired lease by the Debtors results in damages to the
other party or parties to such contract or lease, any claim for such damages, if
not heretofore evidenced by a filed proof of claim, shall be forever barred and
shall not be enforceable against the Debtors, or its properties or agents,
successors, or assigns, unless a proof of claim is filed with the Bankruptcy
Court and served upon counsel for the Debtors on or before fifteen (15) days
after the later to occur of (a) the Confirmation Date and (b) the date of entry
of an order by the Bankruptcy Court authorizing rejection of a particular
executory contract or unexpired lease.
35.4 Indemnification and Reimbursement Obligations: For purposes of the
Plan, the obligations of the Debtors to indemnify and reimburse its directors or
officers that were directors or officers, respectively, on or before the
Petition Date or who became directors or officers after the Petition Date
against and for any obligations pursuant to articles of incorporation, codes of
regulations, bylaws, applicable state law, or specific agreement, or any
combination of the foregoing, shall survive confirmation of the Plan, remain
unaffected thereby, and not be discharged in accordance with section 1141 of the
Bankruptcy Code, irrespective of whether indemnification or reimbursement is
owed in connection with an event occurring before, on, or after the Petition
Date; provided, however, that, notwithstanding the foregoing, such obligations
shall not be extended to any directors or officers whose term in all such
capacities expired or was terminated prior to the Petition Date.
ARTICLE XXXVI
RIGHTS AND POWERS OF DISBURSING AGENT
36.1 Exculpation: From and after the Effective Date, the Disbursing Agent
shall be exculpated by all Persons and Entities, including, without limitation,
holders of Claims and Equity Interests and other parties in interest, from any
and all claims, causes of action and other assertions of liability arising out
of the discharge of the powers and duties conferred upon such Disbursing Agent
by the Plan or any order of the Bankruptcy Court entered pursuant to or in
furtherance of the Plan, or applicable law, except for actions or omissions to
act arising out of the gross negligence, willful misconduct or breach of
fiduciary duty of such Disbursing Agent. No holder of a Claim or an Equity
Interest or other party in interest shall have or pursue any claim or cause of
action against the Disbursing Agent for making payments in accordance with the
Plan or for implementing the provisions of the Plan.
36.2 Powers of the Disbursing Agent: Except to the extent that the
responsibility for the same is vested in the Plan Administrator pursuant to the
Plan Administration Agreement, the Disbursing Agent shall be empowered to (a)
take all steps and execute all instruments and documents necessary to effectuate
the Plan, (b) make distributions contemplated by the Plan, (c) comply with the
Plan and the obligations thereunder, (d) employ professionals to represent it
with respect to its responsibilities, and (e) exercise such other powers as may
be vested in the Disbursing Agent pursuant to order of the Bankruptcy Court,
pursuant to the Plan, or as deemed by the Disbursing Agent to be necessary and
proper to implement the provisions of the Plan.
36.3 Fees and Expenses Incurred From and After the Effective Date: Except
as otherwise ordered by the Bankruptcy Court, the amount of any fees and
expenses incurred by the Disbursing Agent from and after the Effective Date
(including taxes) and any compensation and expense reimbursement claims,
including, without limitation, reasonable fees and expenses of counsel, made by
the Disbursing Agent, shall be paid in Cash by Reorganized UC.
ARTICLE XXXVII
THE PLAN ADMINISTRATOR
37.1 Appointment of Plan Administrator: On the Effective Date, compliance
with the provisions of the Plan shall become the general responsibility of the
Plan Administrator (subject to the supervision
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of the Board of Directors of Reorganized UC) pursuant to and in accordance with
the provisions of the Plan and the Plan Administration Agreement.
37.2 Responsibilities of the Plan Administrator: The responsibilities of
the Plan Administrator shall include (a) facilitating Reorganized UC's
prosecution or settlement of objections to and estimations of Claims, (b)
calculating and assisting the Disbursing Agent in implementing all distributions
in accordance with the Plan, (c) filing all required tax returns and paying
taxes and all other obligations on behalf of Reorganized UC from funds held by
Reorganized UC, (d) periodic reporting to the Bankruptcy Court, of the status of
the Claims resolution process, distributions on Allowed Claims and prosecution
of causes of action, (e) liquidating the Remaining Assets and providing for the
distribution of the net proceeds thereof in accordance with the provisions of
the Plan, (f) managing the Debtors servicing operations during the period from
the Effective Date up to and including the Transfer Date, (g) owning the capital
stock of Reorganized UC, and (h) such other responsibilities as may be vested in
the Plan Administrator pursuant to the Plan, the Plan Administration Agreement
or Bankruptcy Court order or as may be necessary and proper to carry out the
provisions of the Plan.
37.3 Powers of the Plan Administrator: The powers of the Plan
Administrator shall, without any further Bankruptcy Court approval in each of
the following cases, include (a) the power to invest funds in, and withdraw,
make distributions and pay taxes and other obligations owed by Reorganized UC
from funds held by the Plan Administrator and/or Reorganized UC in accordance
with the Plan, (b) the power to engage employees and professional persons to
assist the Plan Administrator with respect to its responsibilities, (c) the
power to compromise and settle claims and causes of action on behalf of or
against Reorganized UC, and (d) such other powers as may be vested in or assumed
by the Plan Administrator pursuant to the Plan, the Plan Administration
Agreement or as may be necessary and proper to carry out the provisions of the
Plan.
37.4 Compensation of the Plan Administrator: In addition to reimbursement
for actual out-of-pocket expenses incurred by the Plan Administrator, the Plan
Administrator shall be entitled to receive reasonable compensation for services
rendered on behalf of Reorganized UC in an amount and on such terms as may be
agreed to by the Debtors for Reorganized UC as reflected in the Plan
Administration Agreement. Any dispute with respect to such compensation shall be
resolved by agreement among the parties or, if the parties are unable to agree,
determined by the Bankruptcy Court.
37.5 Termination of Plan Administrator: The duties, responsibilities and
powers of the Plan Administrator shall terminate on the date set forth in the
Plan Administration Agreement.
ARTICLE XXXVIII
CONDITIONS PRECEDENT TO EFFECTIVE DATE OF THE PLAN
38.1 Conditions Precedent to Effective Date of the Plan: The occurrence of
the Effective Date and the substantial consummation of the Plan are subject to
satisfaction of the following conditions precedent:
(a) Entry of the Confirmation Order: The Clerk of the Bankruptcy
Court shall have entered the Confirmation Order, in form and substance
satisfactory to the Debtors and the Confirmation Order shall have become a Final
Order and be in full force and effect.
(b) Execution of Documents; Other Actions: All other actions and
documents necessary to implement the Plan shall have been effected or executed.
(c) Sale Transaction: Consummation of the Sale Transaction.
38.2 Waiver of Conditions Precedent: Each of the conditions precedent in
Section 37.1, may be waived, in whole or in part, by the Debtors in their sole
discretion. Any such waiver of a condition precedent may be effected at any
time, without notice or leave or order of the Bankruptcy Court and without any
formal action.
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ARTICLE XXXIX
RETENTION OF JURISDICTION
39.1 Retention of Jurisdiction: The Bankruptcy Court shall retain and have
exclusive jurisdiction over any matter arising under the Bankruptcy Code,
arising in or related to the Chapter 11 Cases or the Plan, or that relates to
the following:
(a) to resolve any matters related to the assumption, assumption and
assignment or rejection of any executory contract or unexpired lease to which
the Debtors is 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) to enter 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;
(c) to determine 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 Reorganized
UC after the Effective Date;
(d) to ensure that distributions to holders of Allowed Claims and
Allowed Equity Interests are accomplished as provided herein;
(e) to hear and determine any timely objections to Administrative
Expense Claims or to proofs of Claim and Equity Interests filed, both before and
after the Confirmation Date, including any objections to the classification of
any Claim or Equity Interest, and to allow, disallow, determine, liquidate,
classify, estimate or establish the priority of or secured or unsecured status
of any Claim, in whole or in part;
(f) to enter and implement such orders as may be appropriate in the
event the Confirmation Order is for any reason stayed, revoked, modified,
reversed or vacated;
(g) to issue such orders in aide of execution of the Plan, to the
extent authorized by section 1142 of the Bankruptcy Code;
(h) to consider 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) to hear and determine all applications for awards of
compensation for services rendered and reimbursement of expenses incurred prior
to the Effective Date;
(j) to hear and determine 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 under the Plan;
(k) to issue injunctions, enter and implement other orders or take
such other actions as may be necessary or appropriate to restrain interference
by any Entity with consummation or enforcement of the Plan;
(l) to determine 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;
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(m) to hear and determine matters concerning state, local and
federal taxes in accordance with sections 346, 505, and 1146 of the Bankruptcy
Code;
(n) to hear any other matter or for any purpose specified in the
Confirmation Order that is not inconsistent with the Bankruptcy Code; and
(o) to enter a final decree closing the Chapter 11 Cases.
ARTICLE XL
MODIFICATION, REVOCATION, OR WITHDRAWAL OF THE PLAN
40.1 Modification of Plan: The Debtors reserve the right, in accordance
with the Bankruptcy Code and the Bankruptcy Rules, to amend or modify the Plan
at any time prior to the entry of the Confirmation Order. Upon entry of the
Confirmation Order, the Debtors may, upon order of the Bankruptcy Court, amend
or modify the Plan, in accordance with section 1127(b) of the Bankruptcy Code,
or remedy any defect or omission or reconcile any inconsistency in the Plan in
such manner as may be necessary to carry out the purpose and intent of the Plan.
A holder of a Claim that has accepted the Plan shall be deemed to have accepted
the Plan as modified if the proposed modification does not materially and
adversely change the treatment of the Claim of such holder.
40.2 Revocation or Withdrawal:
(a) The Plan may be revoked or withdrawn prior to the Confirmation
Date by the Debtors.
(b) If the Plan is revoked or withdrawn prior to the Confirmation
Date, then the Plan shall be deemed null and void. In such event, nothing
contained herein shall be deemed to constitute a waiver or release of any claims
by the Debtors or any other Entity or to prejudice in any manner the rights of
the Debtors or any other Entity in any further proceedings involving the
Debtors.
ARTICLE XLI
PROVISION FOR MANAGEMENT
41.1 Directors: On the Effective Date, the board of directors of
Reorganized UC shall be comprised of the Plan Administrator and such other
individuals designated by the Plan Administrator, all of which shall be
disclosed prior to a hearing to consider approval of a disclosure statement
pursuant to section 1121 of the Bankruptcy Code. Thereafter, the terms and
manner of selection of the directors of Reorganized UC shall be as provided in
the Reorganized UC Certificate of Incorporation and the Reorganized UC By-laws,
as the same may be amended.
ARTICLE XLII
ARTICLES OF INCORPORATION AND BY-LAWS OF THE DEBTORS; CORPORATE ACTION
42.1 Amendment of Articles of Incorporation and By-Laws: The articles of
incorporation and by-laws of the Debtors shall be amended as of the Effective
Date to provide substantially as set forth in the Reorganized UC Certificate of
Incorporation and the Reorganized UC By-laws.
42.2 Corporate Action: On the Effective Date, the adoption of the
Reorganized UC Certificate of Incorporation and the Reorganized UC By-laws shall
be authorized and approved in all respects, in each case without further action
under applicable law, regulation, order, or rule, including, without limitation,
any action by the stockholders of the Debtors or Reorganized UC. On the
Effective Date, the cancellation of all Equity Interests, employment agreements,
and other matters provided under the Plan involving the corporate structure of
Reorganized UC or corporate action by Reorganized UC shall be deemed to have
occurred, be authorized, and shall be in effect
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from and after the Effective Date without requiring further action under
applicable law, regulation, order, or rule, including, without limitation, any
action by the stockholders of the Debtors or Reorganized UC.
ARTICLE XLIII
MISCELLANEOUS PROVISIONS
43.1 Title to Assets; Discharge of Liabilities: Except as otherwise
provided by the Plan, on the Effective Date, title to all assets and properties
encompassed by the Plan shall vest in Reorganized UC in accordance with section
1141 of the Bankruptcy Code, and the Confirmation Order shall be a judicial
determination of discharge of the Debtors' liabilities except as provided in the
Plan.
43.2 Discharge of Debtors: The rights afforded in the Plan and the
treatment of all holders of Claims or Equity Interests herein shall be in
exchange for and in complete satisfaction, discharge and release of all Claims
and Equity Interests of any nature whatsoever, known or unknown, including any
interest accrued or expenses incurred thereon from and after the Petition Date
against the Debtors and Debtors in Possession, or any of their estates,
properties, assets or interests in property. Except as otherwise provided
herein, upon the Effective Date, all Claims against and Equity Interests in the
Debtors and Debtors in Possession, shall be satisfied, discharged and released
in full. All Persons and Entities shall be precluded from asserting against the
Debtors, Debtors-in Possession, their successors or assigns, including, without
limitation, Reorganized UC, its agents and employees, or its respective assets
properties or interests in property, any other or further Claims based upon any
act or omission, transaction or other activity of any kind or nature that
occurred prior to the Confirmation Date, whether or not the facts or legal bases
therefor were known or existed prior to the Confirmation Date.
43.3 Injunction: Except as otherwise expressly provided in the Plan, all
Persons or Entities who have held, hold or may hold Claims or Equity Interests
are permanently enjoined, from and after the Effective Date, from (a) commencing
or continuing in any manner any action or other proceeding of any kind on any
such Claim or Equity Interest against the Debtors or Reorganized UC, (b) the
enforcement, attachment, collection or recovery by any manner or means of any
judgment, award, decree or order against the Debtors or Reorganized UC, (c)
creating, perfecting, or enforcing any encumbrance of any kind against the
Debtors or Reorganized UC or against the property or interests in property of
the Debtors or Reorganized UC, and (d) asserting any right of setoff,
subrogation or recoupment of any kind against any obligation due from the
Debtors or Reorganized UC or against the property or interests in property of
the Debtors or Reorganized UC, with respect to any such Claim or Equity
Interest; provided, however, that such injunction shall not preclude the United
States of America of any of its police or regulatory agencies from enforcing
their police or regulatory powers; and, provided, further, that, except in
connection with a properly filed proof of claim, the foregoing proviso does not
permit the United States of America or any of its police or regulatory agencies
from obtaining any monetary recovery from United Companies or Reorganized UC or
their respective property or interests in property with respect to any such
Claim or Equity Interest, including, without limitation, any monetary claim or
penalty in furtherance of a police or regulatory power.
43.4 Term of Existing Injunctions or Stays: Unless otherwise provided, all
injunctions or stays provided for in the Chapter 11 Cases pursuant to sections
105, 362 or 525 of the Bankruptcy Code, or otherwise, and in existence on the
Confirmation Date, shall remain in full force and effect until the Effective
Date.
43.5 Limited Release of Directors, Officers and Employees: As of the
Effective Date, the Debtors shall be deemed to have waived and released its
present and former directors, officers, employees, consultants and agents who
were directors, officers, employees, consultants or agents, respectively, at any
time during the Chapter 11 Cases and on or before the Petition Date, from any
and all claims of the Debtors, including, without limitation, claims which the
Debtors or Debtors in Possession otherwise has legal power to assert, compromise
or settle in connection with the Chapter 11 Cases, arising on or prior to the
Effective Date; provided, however, that this provision shall not operate as a
waiver or release of any claim (i) with respect to any loan, advance or similar
payment by the Debtors to any such person, (ii) with respect to any contractual
obligation owed by such person to the Debtors, (iii) relating to such person's
knowing fraud, or (iv) to the extent based upon or attributable to such person
gaining in fact a personal profit to which such person was not legally entitled,
including, without limitation, profits made from the purchase or sale of equity
securities of the Debtors which are recoverable by the Debtors pursuant to
section 16(b) of the Securities Exchange Act of 1934, as amended.
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43.6 Exculpation: None of the Debtors, Reorganized UC, any indenture
trustee responsible for working distributions under the Plan, and any of their
respective directors, officers, employees, members, attorneys, consultants,
advisors and agents (acting in such capacity), shall have or incur any liability
to any Entity for any act taken or omitted to be taken in the formulation,
preparation, dissemination, implementation, confirmation or approval of the
Plan, the Disclosure Statement related thereto or any contract, instrument,
release or other agreement or document provided for or contemplated in
connection with the consummation of the transactions set forth in the Plan;
provided, however, that the foregoing provisions of this Section 43.6 shall not
affect the liability of any Entity that otherwise would result from any such act
or omission to the extent that such act or omission is determined in a Final
Order to have constituted gross negligence, willful misconduct or breach of
fiduciary duty. Any of the foregoing parties in all respects shall be entitled
to rely upon the advice of counsel with respect to their duties and
responsibilities under the Plan.
43.7 Preservation of Rights of Action: Except as otherwise provided in the
Plan, including, without limitation, Article XXVII of the Plan, or in any
contract, instrument, release of other agreement entered into in connection with
the Plan, in accordance with section 1123(b) of the Bankruptcy Code, Reorganized
UC shall retain sole and exclusive authority to enforce any claims, rights or
causes of action that the Debtors or their chapter 11 estates may hold against
any entity, including any claims, rights or causes of action arising under
sections 544, 547, 548, 549 and 550 of the Bankruptcy Code. Reorganized UC may
pursue such retained rights or causes of action, as appropriate, in accordance
with the best interests of Reorganized UC.
43.8 Injunction: Except as provided in the Plan, as of the Effective Date,
all non-Debtors entities are permanently enjoined from commencing or continuing
in any manner, any action or proceeding, whether directly, derivatively, on
account of or respecting any claim, debt, right or cause of action of the
Debtors or Reorganized UC which the Debtors or Reorganized UC, as the case may
be, retain sole and exclusive authority to pursue in accordance with Section
42.7 of the Plan or which has been released pursuant to the Plan.
43.9 Payment of Statutory Fees: All fees payable pursuant to section 1930
of title 28 of the United States Code, as determined by the Bankruptcy Court at
the Confirmation Hearing, shall be paid on the Effective Date.
43.10 Retiree Benefits: From and after the Effective Date, other than with
respect to individuals with whom the Debtors have agreed to lump sum claim
amounts in respect of future retiree benefits, pursuant to section 1129(a)(13)
of the Bankruptcy Code, Reorganized UC shall continue to pay all retiree
benefits (within the meaning of section 1114 of the Bankruptcy Code), at the
level established in accordance with subsection (e)(1)(B) or (g) of section 1114
of the Bankruptcy Code, at any time prior to the Confirmation Date, and for the
duration of the period during which the Debtors have obligated themselves to
provide such benefits.
43.11 Post-Effective Date Fees and Expenses: From and after the Effective
Date, Reorganized UC shall, in the ordinary course of business and without the
necessity for any approval by the Bankruptcy Court, pay the reasonable
professional fees and expenses incurred by Reorganized UC related to
implementation and consummation of the Plan.
43.12 Severability: If, prior to the Confirmation Date, any term or
provision of the Plan shall be held by the Bankruptcy Court to be invalid, void
or unenforceable, the Bankruptcy Court shall, with the consent of the Debtors,
have the power to alter and interpret such term or provision to make it valid or
enforceable to the maximum extent practicable, consistent with the original
purpose of the term or provision held to be invalid, void or unenforceable, and
such term or provision shall then be applicable as altered or interpreted.
Notwithstanding any such holding, alteration or interpretation, the remainder of
the terms and provisions of the Plan shall remain in full force and effect and
shall in no way be affected, impaired or invalidated by such holding, alteration
or interpretation. The Confirmation Order shall constitute a judicial
determination and shall provide that each term and provision of the Plan, as it
may have been altered or interpreted in accordance with the foregoing, is valid
and enforceable pursuant to its terms.
43.13 Governing Law: Except to the extent that the Bankruptcy Code or
other federal law is applicable, or to the extent that an exhibit hereto or
document contained in the Plan Supplement provides otherwise, the rights, duties
and obligations arising under this Plan shall be governed by, and construed and
enforced in
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accordance with, the Bankruptcy Code and, to the extent not inconsistent
therewith, the laws of the State of Louisiana, without giving effect to
principles of conflicts of laws.
43.14 Notices: All notices, requests, and demands to or upon the Debtors
or Reorganized UC to be effective shall be in writing, including by facsimile
transmission, and, unless otherwise expressly provided herein, shall be deemed
to have been duly given or made when actually delivered or, in the case of
notice by facsimile transmission, when received and telephonically confirmed,
addressed as follows:
United Companies Financial Corporation
P.O. Box 1591
4041 Essen Lane
Baton Rouge, LA 70809
Attention: Lawrence J. Ramaekers
Telecopier: (225) 987-4231
Telephonic Confirmation: (225) 924-6007
With a copy to:
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, New York 10153
Attention: Marcia L. Goldstein, Esq.
Brian S. Rosen, Esq.
Telecopier: (212) 310-8007
Telephonic Confirmation: (212) 310-8888
-and-
Richards, Layton & Finger, P.A.
One Rodney Square
Wilmington, Delaware 19899
Attention: Mark D. Collins, Esq.
Telecopier: (302) 658-6548
Telephonic Confirmation: (302) 658-6541
43.15 Closing of Cases: Reorganized UC shall, promptly upon the full
administration of the Chapter 11 Cases, file with the Bankruptcy Court all
documents required by Bankruptcy Rule 3022 and any applicable order of the
Bankruptcy Court.
43.16 Section Headings: The section headings contained in this Plan are
for reference purposes only and shall not affect in any way the meaning or
interpretation of the Plan.
Dated: Baton Rouge, Louisiana
June 6, 2000
UNITED COMPANIES FINANCIAL CORPORATION
By: /s/ Lawrence J. Ramaekers
-------------------------------------
Name: Lawrence J. Ramaekers
Title: Chief Executive Officer
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PELICAN MORTGAGE FINANCIAL CORPORATION
By: /s/ Lawrence J. Ramaekers
-------------------------------------
Name: Lawrence J. Ramaekers
Title: Chief Executive Officer
UNITED COMPANIES LENDING GROUP, INC.
By: /s/ Lawrence J. Ramaekers
-------------------------------------
Name: Lawrence J. Ramaekers
Title: Chief Executive Officer
UNITED COMPANIES LENDING CORPORATION
By: /s/ Lawrence J. Ramaekers
-------------------------------------
Name: Lawrence J. Ramaekers
Title: Chief Executive Officer
ADOBE, INC.
By: /s/ Lawrence J. Ramaekers
-------------------------------------
Name: Lawrence J. Ramaekers
Title: Chief Executive Officer
ADOBE FINANCIAL, INC. I
By: /s/ Lawrence J. Ramaekers
-------------------------------------
Name: Lawrence J. Ramaekers
Title: Chief Executive Officer
GINGER MAE, INC.
By: /s/ Lawrence J. Ramaekers
-------------------------------------
Name: Lawrence J. Ramaekers
Title: Chief Executive Officer
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UNICOR MORTGAGE, INC.
By: /s/ Lawrence J. Ramaekers
-------------------------------------
Name: Lawrence J. Ramaekers
Title: Chief Executive Officer
SOUTHERN MORTGAGE ACQUISITION, INC.
By: /s/ Lawrence J. Ramaekers
-------------------------------------
Name: Lawrence J. Ramaekers
Title: Chief Executive Officer
UNITED COMPANIES FUNDING, INC.
By: /s/ Lawrence J. Ramaekers
-------------------------------------
Name: Lawrence J. Ramaekers
Title: Chief Executive Officer
GOPHER EQUITY, INC.
By: /s/ Lawrence J. Ramaekers
-------------------------------------
Name: Lawrence J. Ramaekers
Title: Chief Executive Officer
UNITED CREDIT CARD, INC.
By: /s/ Lawrence J. Ramaekers
-------------------------------------
Name: Lawrence J. Ramaekers
Title: Chief Executive Officer
36
