UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Princeton American Corporation PELT
(Name of Issuer)
Common Stock________
(Title of Class of Securities)
741783-302
(CUSIP Number)
William C. Taylor, 7616 Sierra Vista Drive, Scottsdale, Arizona 85250
(602)922-0072; FAX #: (602) 922-0702
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
December 20, 1997 (* see Items 4 and 5)
(Date of Event which Requires Filing of this Statement)
CUSIP No. 741783-302
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1. Names of reporting Persons
I.R.S. Identification Nos. of above Persons (entities only):
William C. Taylor
2. Check the Appropriate Box if a Member of a Group (See Instructions):
(a) ___________________________________________________________________
(b) ___________________________________________________________________
3. SEC Use Only:
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4. Source of Funds (See Instructions): 00
5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d)
or 2(e): N/A
6. Citizenship or Place of Organization: United States
7. Sole Voting power 40% of the outstanding stock of Princeton American
Corporation (see text of Items 4 and 5)
8. Shared Voting Power -0-
9. Sole Dispositive Power 40% of the outstanding common stock (see text of
Items 4 and 5)
10. Shared Dispositive Power -0-
11. Aggregate Amount Beneficially Owned by Each Reporting Person:
The aggregate number of shares identified in Item 5 is unknown at this
time. However, under the fully implemented Joint Plan of Reorganization for
Princeton American Corporation, the shares identified in Item 5 will represent
40% of all outstanding common stock (see text of items 4 and 5).
12. Check if the Aggregate Amount in Row 11 Excludes Certain Shares (See
Instructions): N/A
13. Percent of Class Represented by Amount in Row (11): 40% of the outstanding
common stock (see text of Item 5).
14. Type of Reporting Person (See Instructions): IN
Item 1. Security and Issuer
Common Stock of Princeton American Corporation PELT,
300 W. Clarendon , Suite 210, Phoenix, Arizona 85013
Item 2. Identity and Background
(a)-(c) and (f). This Statement is being filed by William C. Taylor
("Taylor") whose address is 7616 Sierra Vista Drive, Scottsdale, Arizona 85250.
Taylor is a
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citizen of the United States and President and Director of Princeton American
Corporation ("Issuer"). Issuer's principal address and business office is 300
West Clarendon, Suite 210, Phoenix, Arizona 85013.
(d) and (e). During the last five years, Taylor has not (i) been convicted
in a criminal proceeding (excluding traffic violations and similar misdemeanors)
or (ii) been a party to a civil proceeding of a judicial or administrative body
of competent jurisdiction and as a result of such proceeding was or is subject
to a judgement, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, Federal or state securities laws
or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
Pursuant to a Joint Plan of Reorganization for Issuer ("Reorganization
Plan"), confirmed on November 19, 1997, by the United States Bankruptcy Court
for the District of Arizona, Case No. 96-13675 PHX JMM, Taylor was awarded the
right to receive common stock that represents 40% of Issuer's total stock that
will remain outstanding after the Reorganization Plan is fully implemented.(1)
This right was received in satisfaction of Taylor's allowed claims consisting of
approximately $936,393, arising from a Personal Services Consulting Agreement.
Item 4. Purpose of Transaction
Issuer is the surviving corporation of a merger between Minco American
Corporation, a Nevada Corporation, and Princeton Electronic Products, Inc., a
New Jersey Corporation. Taylor entered into a Personal Services Consulting
Agreement ("Agreement") with Minco dated May 5, 1991. After Issuer failed to
make payments due Taylor under the Agreement, Taylor sued Issuer for amounts due
under the contract in state court. Issuer filed its petition commencing a
bankruptcy case on December 11, 1996. In the Chapter 11 proceedings, Taylor
asserted claims arising from the Agreement consisting of $346,393 for
arrearages, a balance of $590,000 owed on the Agreement, and attorneys' fees and
costs incurred pre-petition.
On November 19, 1997, the bankruptcy court confirmed the Joint Plan of
Reorganization, effective December 20, 1997, filed as Exhibit 1 hereto and
incorporated herein by reference. Under the Joint Plan of Reorganization,
Taylor's claims were satisfied by an issuance of a number of shares of common
stock that represent forty percent (40%) of Issuer's total common stock that
will be outstanding after December 27, 1997, and after taking into account the
following claims as defined in the Joint Plan of Reorganization: the stock held
by the holders of Class 11 Interests, the stock held by the holders of Class 12
Interests, the stock held by holders of claims that are subordinated to Class
12, the stock issued to holders of Allowed Interests based upon warrants,
options of similar rights, and the stock issued in
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(1) When combined with stock Taylor already owned, this amount represents less
than 41% of Issuer's total common stock.
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satisfaction of the Class 13 claims. See paragraph 5.10 of the Joint Plan of
Reorganization attached as Exhibit 1 hereto and incorporated by reference.
Pursuant to the terms of the Joint Plan of Reorganization, Taylor's stock
(and any dividends issued in respect of such stock) are being held in escrow by
Roger W. Brown, the Chapter 11 Trustee, and are not transferable, assignable or
redeemable, until all Class 8 and Class 9 Allowed Claims have been paid in full
as provided by the Reorganization Plan. Taylor has and may exercise all voting
and other shareholder rights and powers represented by such stock while it is
held in escrow. When all Allowed Class 8 and Class 9 Claims have been paid as
provided by the Reorganization Plan, the Trustee shall deliver the stock held in
escrow to Taylor.
As a result of the confirmed Reorganization Plan, the board of directors,
Dale E. Eyman, David S. Smith and Michael B. Mooney, has been replaced by
Taylor, Roderick W. Mckinnon III and Scott E. Bird, Jr., effective as of
December 20, 1997, the effective date of the Reorganization Plan.
The Confirmed Joint Plan of Reorganization for Issuer has been previously
filed with the Securities Exchange Commission as Exhibits 1 and 2 to Issuer's
Form 8-K dated December 20, 1997.
Item 5. Interest in Securities of the Issuer
Taylor is deemed the beneficial owner of common stock shares representing
40% of the outstanding common stock of Issuer. The number of outstanding shares
is unknown at this time as prior schedules filed in bankruptcy court by Issuer
reflect a total of 18,443,586 common shares outstanding, but information
received from Issuer's stock transfer agent reflects that there may be as many
as 26 million shares outstanding. Pursuant to the Reorganization Plan, the
shares of stock beneficially owned in Item 1 (including any dividends issued in
respect of such stock) are currently held in escrow. While in escrow, Taylor has
and may exercise all voting and other shareholder rights and powers represented
by such stock while it is held in escrow, though the shares are not
transferable, assignable, or redeemable until certain allowed claims are paid.
See Item 4.
Item 6. Contracts, Arrangements, Understandings or Relationships with
Respect to Security of the Issuer
Other than the information set forth in response to Items 4 and 5 and the
copy of the Joint Plan of Reorganization, no contracts, arrangements,
understandings or relationships (legal or otherwise) between Taylor and any
other person with respect to any securities of the Issuer exist.
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Item 7. Material to Be Filed as Exhibits
Exhibit 1: Order confirming Joint Plan of Reorganization dated November 19,
1997, and Trustee's and Taylor's Joint Plan of Reorganization dated November 14,
1997.
Signature
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Date: February ___, 1998
William C. Taylor
5
LEWIS AND ROCA LLP
40 North Central Avenue
Phoenix, Arizona 85004-4429
Facsimile (602) 262-5747
Telephone (602) 262-5311
Gerald K. Smith (001428)
Randolph J. Haines (005440)
Attorneys for William Taylor
UNITED STATES BANKRUPTCY COURT
DISTRICT OF ARIZONA
In re:
PRINCETON AMERICAN
CORPORATION,
Debtor.
EID: 22-1848644
No. 96-13675 PHX JMM
Chapter 11
TRUSTEE'S AND TAYLOR'S JOINT
PLAN OF REORGANIZATION
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Trustee Roger W. Brown ("Trustee") and creditor and equity security holder
William C. Taylor ("Taylor") submit the following Joint Plan of Reorganization
for Princeton American Corporation ("Debtor"). This Joint Plan was originally
dated August 28, 1997, and incorporates the modifications dated October 16, 1997
and November 14, 1997.
Article I
Definitions
Terms used in this Plan have the meanings specified in the Bankruptcy Code
or Rules unless the context clearly otherwise requires or one of the following
definitions applies:
1.1 Administrative Expense Claim: Any cost or expense of
administration incurred in connection with this chapter 11 case after the
filing of the petition commencing this case and before the Confirmation
Date, including: (1) the actual, necessary costs and expenses of preserving
Debtor's estate pursuant to Code Section 503(b); (2) claims for
compensation for legal and other professional services and costs and
expenses pursuant to Code Section 330 and 503(b), as allowed by the
Bankruptcy Court; and (3) fees and charges assessed against Debtor's estate
pursuant to 28 U.S.C. Section 1930.
1.2 Allowed: A claim (other than an Administrative Claim) is Allowed
when (a) it is scheduled by Debtor as undisputed and no objection is filed
by the Objection Bar Date; (b) a proper proof of claim is filed by the
Claims Bar Date and no objection is filed by the Objection Bar Date; or (c)
allowed by entry of the Court's Final Order. As to an Administrative
Expense Claim, "Allowed" means approved by Final Order, after notice and
hearing as required by the Code, of an application for payment of an
Administrative Expense Claim filed by the deadline established by the
Court, but not including any Administrative Claim which may have previously
been paid.
1.3 Assets: All of the property of Debtor's estate as defined in Code
Section 541, all property of the Debtor's subsidiaries that are merged into
the Debtor pursuant to this Plan, and all property recovered or brought
into the estate pursuant to Code Section 550.
1.4 Bar Date: The dates established by Court order by which all proofs
of claim and proofs of interests must be filed (except for claims arising
from the rejection of executory contracts or leases and claims arising from
recoveries pursuant to Code Section 550) in order to become Allowed and
participate in distributions pursuant to this Plan (except as otherwise
provided in paragraph 5.9).
1.5 Biosome: Biosome Products, Inc., a subsidiary of the Debtor in
which the Debtor owns 80% of the equity interest, engaged in the personal
care products industry.
1.6 Chino Valley Land: Approximately five (5) acres of
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raw land located in Chino Valley, Yavapai County, Arizona, owned by the
Debtor.
1.7 Chino Valley Receivable: Two notes receivable of approximately
$46,000 payable to the Debtor.
1.8 Code or Bankruptcy Code: Title 11 of the United States Code, as
amended, and related provisions.
1.9 Committee: The Official Unsecured Creditors' Committee appointed
in this Case pursuant to Code Section 1102(a).
1.10 Confirmation: The Court's entry of an order confirming this Plan
in accordance with the Code.
1.11 Confirmation Date: The date on which the Confirmation Order is
entered on the Court's docket.
1.12 Confirmation Order: The Court's appealable order confirming the
Plan pursuant to Code Section 1129.
1.13 Court or Bankruptcy Court: The United States Bankruptcy Court for
the District of Arizona.
1.14 Debtor: Princeton American Corporation.
1.15 Disputed Claims and Disputed Interests: Any claim or interest as
to which an objection is filed by the Objection Bar Date and which is not
resolved by entry of the Court's Final Order.
1.16 Effective Date: Thirty (30) days after entry of the Confirmation
Order.
1.17 88 Redevelopment: A Nevada corporation that is a wholly owned
subsidiary of the Debtor and that owns the office building and other
improvements located at 2222 E. Camelback Road, Phoenix, Arizona.
1.18 Final Order: An order, judgment, ruling, or other decree issued
by the Court which order, judgment, or other decree has not been reversed,
stayed, modified, or amended, and as to which (1) the time to appeal or to
seek review, rehearing, or certiorari has expired and as to which no appeal
or petition for review, rehearing, or certiorari is pending or has been
timely filed; or, (2) any appeal that has been or may be taken or any
petition for certiorari that has been or may be filed has been resolved by
the highest court to which the order or judgment was appealed or from which
certiorari was sought.
1.19 4808 Corporation: A Nevada corporation that is a wholly owned
subsidiary of the Debtor and that owns the office building and other
improvements located at 4808 N. 22d St., Phoenix, Arizona.
1.20 4808 N. 22d St.: An office building located at 4808
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N. 22d St., Phoenix, Arizona, owned by the Debtor's wholly owned subsidiary
4808 Corporation.
1.21 GSK: GSK Products, Inc., a subsidiary of the Debtor in which the
Debtor owns 50% of the equity interest, engaged in the personal care
product industry.
1.22 Interests: Equity ownership interests held by virtue of ownership
of Debtor's stock.
1.23 Interim Manager: The manager of the Reorganized Debtor pursuant
to paragraph 7.3 of the Plan, from the Confirmation Date until the Board of
Directors meets and appoints officers for the Reorganized Debtor.
1.24 Joint Plan: This Plan of Reorganization, jointly proposed by
Taylor and Trustee, as it may be modified.
1.25 Lone Mountain: An approximate 4.2 acre parcel of undeveloped real
property located at the northwest corner of Scottsdale Road and Lone
Mountain, Maricopa County, Arizona, owned by the Debtor.
1.26 Minco: Minco American Corporation, a predecessor in interest to
the Debtor, which continues to exist as a corporation whose shareholders
are also shareholders of the Debtor.
1.27 Objection Bar Date: The date established by Court order by which
all objections to claims (either proofs of claim or claims as scheduled)
must be filed in order for the claim not to be deemed an Allowed Claim for
purposes of distribution.
1.28 Petition Date: December 11, 1996, the date of the filing of the
petition initiating this bankruptcy case.
1.29 Plan: This Plan of Reorganization, as it may be modified.
1.30 Plan Proponents: Trustee and Taylor.
1.31 Prinwest: Prinwest Corporation, a wholly owned subsidiary of the
Debtor that owned a warehouse that was sold prepetition.
1.32 Reorganized Debtor: The Debtor after the Effective Date.
1.33 Saturn Resources: Saturn Resources, Inc., a Nevada corporation
that was a wholly owned subsidiary of the Debtor prepetition but whose
stock was conveyed to David Smith prepetition, and that owns 74 lots in
Peoria, Arizona that are selling to Miller Mobile Homes for $9,200 per lot.
1.34 Substantial Consummation: For purposes of 11 U.S.C. Section
1127(b), substantial consummation shall occur upon commencement of
distributions to Class 9 general unsecured
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creditors.
1.35 Taylor: William C. Taylor, a creditor and equity security holder
of the Debtor.
1.36 Trustee: The Chapter 11 Trustee appointed and serving pursuant to
Code Section 1104, Roger W. Brown.
1.37 2222 E. Camelback Road: An office building located at 2222 E.
Camelback Road, Phoenix, Arizona, owed by the Debtor's wholly owned
subsidiary 88 Redevelopment.
Article II
Classification of Claims and Interests
All Allowed Claims and Interests are placed in the following classes:
2.1 Class 1 - Administrative Expense Claims. All claims filed pursuant
to Code Section 503(b).
2.2 Class 2 - Priority Wage Claims: All claims for wages, salaries or
commissions as defined in Section 507(a)(3) of the Code.
2.3 Class 3 - Priority Employee Benefit Claims: All claims of
employees for contributions to an employee benefit plan as defined in
Section 507(a)(4) of the Code.
2.4 Class 4 - Priority Tax Claims: All unsecured claims of
governmental units for taxes as defined in Section 507(a)(8) of the Code.
2.5 Class 5 - Property Tax Claims: All claims for ad valorem taxes
owed to any governmental unit, secured by any Asset.
2.6 Class 6 - Vanderford Secured Claim that is secured by a first deed
of trust on 2222 E. Camelback Road and a second deed of trust on 4808 N.
22d St.
2.7 Class 7 - DBK Secured Claim that is secured by a first deed of
trust on 4808 N. 22d St.
2.8 Class 8 - Administrative Convenience Class: All unsecured claims
that are less than Five Thousand Dollars ($5,000), or the holders of which
elect to reduce their claims to $5,000 and waive any claim for any balance.
2.9 Class 9 - General Unsecured Claims: All unsecured claims that are
not otherwise classified.
2.10 Class 10 - Intercompany Claims: All unsecured claims of the
Debtors' subsidiaries that are being merged into the Debtor pursuant to
this Plan.
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2.11 Class 11 - Preferred Stock: All equity Interests represented by
preferred stock in the Debtor.
2.12 Class 12 - Common Stock: All equity Interests represented by
common stock in the Debtor, all equity interests convertible into common
stock of the Debtor including warrants and options, and all claims
subordinated to the level of Interests pursuant to Code Section 510(b) or
(c).
2.13 Class 13 - Taylor Claims: All claims held by Taylor.
2.14 Automatic Elimination of Unoccupied Classes. In the event any of
the designated classes does not contain at least one Allowed Claim or
Interest, such class shall automatically be deemed eliminated from this
Plan.
Article III
Payment of Administrative Expense Claims
All Allowed Administrative Expense Claims shall be paid, in cash, on
the later of the Effective Date, when due in accordance with the ordinary
business terms governing the payment of such claims, when Allowed, or at such
time and on such terms as may be agreed to by the claimant and the Reorganized
Debtor. All fees payable under 28 U.S.C. Section 1930 that have not been paid as
of the Confirmation Date shall be paid on the Effective Date.
Article IV
Designation and Treatment of Unimpaired Classes
Classes 1, 2, 3 and 4 are unimpaired, and all Allowed Claims in such
classes shall be paid in full, in cash on the Effective Date or when Allowed,
whichever is later. Pursuant to Code Section 1126(f), all holders of claims in
such classes are conclusively presumed to have accepted the Plan so the holders
of such claims will not be permitted to vote.
Article V
Designation and Treatment of Impaired Classes
5.1 Impaired Classes Generally. Classes 5 through 12 are impaired.
5.2 Class 5 Secured Tax Claims. The holders of Allowed Secured Tax Claims
in Class 5 shall retain their liens and will be paid the Allowed amount of their
claims, together with interest in an amount and at a rate determined by the
Court to satisfy Code Section 1129(b)(2)(A)(i)(II), six (6) months after the
Effective Date.
5.3 Class 6 Secured Claims. The holder of the Allowed Secured Claim in
Class 6 (Vanderford) will retain its liens and will be paid in monthly
installments commencing on the first
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day of the first full month that is at least thirty (30) days after the
Effective Date, with the amount of each installment calculated on a thirty (30)
year amortization with interest at a rate determined by the Court to satisfy
Code Section 1129(b)(2)(A)(i)(II), with the full balance due on the seventh
(7th) anniversary of the Effective Date.
5.4 Class 7 Secured Claims. The holder of the Allowed Secured Claim in
Class 7 (DBK) is impaired because the reorganized Debtor will become owner of
its collateral and the obligor on its obligation, without DBK's consent, but DBK
shall retain its lien and be paid by the Reorganized Debtor in accordance with
the terms of its note and deed of trust.
5.5 Class 8 Administrative Convenience Class. All Class 8 Allowed Claims
shall be paid in full, in cash, thirty (30) days after the Effective Date.
5.6 Class 9 General Unsecured Claims. All Class 9 Allowed Unsecured Claims
shall be paid in full, in cash, by the first anniversary of the Effective Date,
together with interest at a per annum rate of eight percent (8%), or such other
rate as the Court may determine is required by Code Section 1129(b)(2)(B)(i),
accrued on the unpaid balance from the Effective Date until the date of payment.
5.7 Class 10 Intercompany Debt Claims. All intercompany claims shall be
eliminated, shall receive no distribution under the Plan and be discharged as of
the Effective Date.
5.8 Class 11 Preferred Stock Interests. All Allowed Class 11 Preferred
Stock Interests shall receive common stock of the Debtor, at the rate of one
share of common stock for each share of preferred stock interest that is
Allowed, and the preferred stock shall be extinguished as of the Effective Date.
5.9 Class 12 Common Stock Interests. All Allowed Class 12 Common Stock
Interests shall retain their common stock and otherwise receive no distribution
under this Plan. Notwithstanding the failure of a holder of common stock to file
a proper proof of interest by the Bar Date, the Interests of all holders of
10,000 shares or less of Debtor's common stock (according to the records of
American Stock Transfer as of the date of the order approving the disclosure
statement for this Plan) shall be Allowed absent specific objection to such
Interest and entry of a Final Order disallowing such Interest. The Interest of
any holder of more than 10,000 shares of Debtor's common stock (according to the
records of American Stock Transfer as of the date of the order approving the
disclosure statement for this Plan) shall be Allowed in the amount of 10,000
shares if such holder files a ballot on this Plan making such election, absent
specific objection to such Interest and entry of a Final Order disallowing such
Interest. All Allowed Claims that have been subordinated to Class 12 pursuant to
Code Section 510(b) or (c) shall receive common stock having a value equal to
the amount of the Allowed Claim based upon the percentage ownership that such
stock represents
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of the net equity value of the Debtor's assets as of the Effective Date, as
determined by the Court. All Allowed Claims and Interests based on warrants,
options or other similar rights shall receive common stock having a value equal
to the value of the Allowed Claim or Interest, based upon the percentage
ownership that such stock represents of the net equity value of the Debtor's
assets as of the Effective Date, as determined by the Court.
5.10 Class 13 Taylor Claims. All Class 13 Claims shall be satisfied by an
issuance of a number of shares of common stock that represent forty percent
(40%) of the total of all of the Debtor's common stock that will be outstanding
after the Effective Date (after taking into account the stock held by the
holders of Class 11 Interests, the stock held by the holders of Class 12
interests, the stock held by holders of claims that are subordinated to Class
12, the stock issued to holders of Allowed Interests based upon warrants,
options or similar rights, and the stock issued in satisfaction of the Class 13
claims). Such stock (and any dividends issued in respect of such stock) shall be
held in escrow by the Trustee, and shall not be transferrable, assignable or
redeemable, until all Class 8 and Class 9 Allowed Claims have been paid in full
as provided by this Plan, provided, however, that Taylor shall have and may
exercise all voting and other shareholder rights and powers represented by such
stock while it is held in escrow. When all Allowed Class 8 and Class 9 claims
have been paid as provided by this Plan, the stock held in escrow shall be
delivered to Taylor by the Trustee. In the event of material default in this
Plan relating to the satisfaction of the Class 8 and Class 9 claims, such stock
shall be distributed by the Trustee to the holders of unsatisfied Allowed Class
8 and Class 9 claims in amounts equal to the unsatisfied portion of such Allowed
Claims, based upon the percentage ownership that such stock represents of the
net equity value of the Debtor's assets as of the date of distribution, as
determined by the Court.
Article VI
Treatment of Executory Contracts
6.1 Ground Leases Assumed. Upon the Effective Date, the ground leases on
4808 N. 22d St. and 2222 E. Camelback Road shall be assumed by the Reorganized
Debtor.
6.2 Contracts Not Assumed Rejected. Upon the Effective Date, all executory
contracts and unexpired leases that have not been assumed shall be deemed
rejected.
6.3 Sale or Assignment of Assumed Contracts or Leases. Any executory
contracts or leases that are assumed may be sold or assigned by the Reorganized
Debtor pursuant to Article VIII below, any such sale or assignment being deemed
pursuant to Code Section 365(f).
6.4 Claims Arising From Rejection. Any claim arising out of Debtor's
rejection of an executory contract or unexpired lease must be filed within 30
days after notice of entry of the
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order authorizing rejection or, if no such separate order was entered and the
rejection is pursuant to this Plan, within 30 days after the Confirmation Date.
Article VII
Implementation of Plan
7.1 Overview. All unsecured claims that are Allowed (and not subordinated)
shall be paid in full, in cash, within one year after the Effective Date, either
out of (a) the Reorganized Debtor's operating income, (b) capital contributed as
a result of a merger of the Reorganized Debtor with another entity, or (c) sale
or refinancing of one or more of the assets of the Reorganized Debtor, including
but not limited to one of the office buildings. All common stock interests shall
be retained. Some insiders' claims will be satisfied, to the extent Allowed, by
an issuance of common stock.
7.2 Merger of Wholly Owned Subsidiaries. Effective as of the Confirmation
Date, the Debtor's wholly owned subsidiaries 4808 Corporation and 88
Redevelopment shall be merged into the Debtor and their Assets shall be deemed
to be Assets of the Debtor's estate as defined in Code Section 541. All claims
secured by those Assets shall be deemed to be claims in this Bankruptcy Case as
defined in Code Section 101(5). All of the Debtor's other subsidiaries will
remain as separate subsidiaries.
7.3 Operation of Debtor after Confirmation. As of the Confirmation Date,
all Assets and property of the Debtor's estate shall be revested in the
Reorganized Debtor pursuant to Code Section 1141(b). The Trustee shall serve as
Interim Manager of the Reorganized Debtor to maintain the status quo until the
Reorganized Debtor's Board of Directors meets to appoint new management, which
shall occur within thirty (30) days of the Effective Date. The Trustee's
compensation, both prior to the Effective Date and thereafter, shall be subject
to Court approval pursuant to 11 U.S.C. Section 330.
Upon the Effective Date, the Reorganized Debtor's Board of Directors shall
consist of Taylor, Roderick W. McKinnon III and Scott E. Bird, Jr., whose terms
shall expire on the first anniversary of the Effective Date. The new Board shall
meet as soon as practicable after the Effective Date to appoint new officers and
other management for the Reorganized Debtor. Neither of the Plan Proponents has
any contracts, agreements or understandings as to whom the Board might appoint.
Management salaries and director compensation shall not exceed a total of
$100,000.
The Reorganized Debtor shall come current on all reporting requirements of
the Securities and Exchange Commission within ninety (90) days of the Effective
Date.
A stockholders' meeting shall be held within one year of the Effective
Date, at which the stockholders shall
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be provided the opportunity to vote for the Reorganized Debtor's board of
directors, to adopt or amend the bylaws, and to handle such other business
as may properly come before an annual shareholders' meeting.
7.4 Merger Considerations. The Reorganized Debtor shall actively pursue
merger opportunities, with merger partners who can provide additional capital
and/or business to the merged entity and who can increase the market and
tradabiltiy of the Reorganized Debtor's stock. All merger proposals that are
deemed worthy of consideration by any of the members of the Reorganized Debtor's
Board of Directors shall be submitted both to the shareholders and to the Court
for approval or disapproval. Upon request of the Joint Proponents, this Plan may
be modified pursuant to Code Section 1127(b) prior to Substantial Consummation
to facilitate any merger that may be approved by the shareholders or by the
Court.
7.5 Surrender and Cancellation of Debt Instruments and Security. No holder
of a promissory note, bond, payment guaranty, warrant, stock option, preferred
stock or other transferable instrument (collectively "instrument") shall receive
any distribution under the Plan until such instrument has been surrendered to,
or satisfactory evidence that the instrument is lost has been provided to, the
Debtor or Reorganized Debtor. Any holder of such an instrument who fails to
surrender such instrument or provide satisfactory evidence of loss thereof
within thirty (30) days after the Effective Date shall be deemed to have no
further claim against or Interest in the Reorganized Debtor and shall receive no
distribution under the Plan.
7.6 De Minimis Distributions. Notwithstanding anything to the contrary
herein, no distributions of cash shall be made hereunder in an amount less than
$10.00
ARTICLE VIII
EFFECT OF CONFIRMATION
8.1 Modification or Withdrawal. This Plan may be withdrawn at any time
prior to the Effective Date by either Plan Proponent. Pursuant to Code Section
1127(a), this Plan may be modified by the Plan Proponents at any time prior to
the Confirmation Date by the filing of a modification with the Court. Pursuant
to Code Section 1127(b), this Plan may be modified by the Plan Proponents at any
time prior to the Effective Date upon the Court's approval of such modification
after notice and hearing. In addition, before or after the Effective Date, the
Plan Proponents may modify this Plan with Court approval, on such notice as the
Court may deem necessary, so long as the modification does not materially and
adversely affect the interests of creditors and interest holders to remedy any
defect, omission or scrivener's error, reconcile any inconsistencies, or to
implement the terms, purposes and intent of this Plan. This Plan may be modified
by the Joint Proponents after the Effective Date, and prior
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to Substantial Consummation, in accordance with Code Section 1127(b),
particularly for the purposes specified in paragraph 7.4 above. This Plan may
not be modified by any person or entity other than the Plan Proponents. No
withdrawal or modification of the Plan shall create any liability for either of
the Plan Proponents or any attorney, accountant or other agent or employee of
either of the Plan Proponents.
8.2 Retention and Release of Claims. Pursuant to Code Section 1141(b) and
except as otherwise provided in this Plan, the Reorganized Debtor shall retain
and may enforce after the Effective Date any and all claims of Debtor and the
Trustee, including but not limited to actions assertable pursuant to Code
Section 362, 365, 502, 506(c), 510, 542, 544, 547, 548, 549, 550, 551, 552 and
553 except claims assigned, sold, waived, relinquished or released in accordance
with the Plan.
8.3 Revesting. Except as provided for in the Plan or in the Confirmation
Order, on the Effective Date Reorganized Debtor shall be revested with all of
the property of its estate free and clear of all claims, liens, charges and
other interests of creditors arising prior to the Petition Date. Upon the
Effective Date the Reorganized Debtor shall operate its business free of any
restrictions other than as set forth in this Plan.
8.4 Discharge. Except as otherwise provided in the Plan or in the
Confirmation Order, the Confirmation Order acts as a discharge, effective as of
the Effective Date, of any and all debts of Debtor that arose at any time before
the entry of the Confirmation Order, including, but not limited to, all
principal and any and all interest accrued thereon, pursuant to Code Section
1141(d)(1). The discharge of Debtor shall be effective as to each claim,
regardless of whether a proof of claim thereof was filed, whether the claim is
an Allowed Claim or whether the holder thereof votes to accept the Plan.
ARTICLE IX
RETENTION OF JURISDICTION
Notwithstanding confirmation of this Plan, the Bankruptcy Court shall
retain jurisdiction for the following purposes:
9.1 Claims and Interests. Determination of the allowability of claims
and interests upon objection to such claims by Debtor, the Reorganized
Debtor, the Trustee, either Plan Proponent or by any creditor, and
estimation of Disputed Claims and Disputed Interests.
9.2 Administrative Claims. Determination of requests for payment of
claims entitled to priority under Code Section 507(a)(1), including
compensation of parties entitled thereto.
<PAGE>
9.3 Disputes. Resolution of controversies and disputes regarding the
interpretation or enforcement of the terms of the Plan, any of the
instruments issued under the Plan or any other documentation evidencing the
terms of the Plan.
9.4 Implementation. Implementation of the provisions of the Plan and
entry of orders in aid of confirmation of the Plan, including, without
limitation, consideration and approval or disapproval or any proposed
merger in accordance with paragraph 7.4 above.
9.5 Adversary Proceedings. Litigation of adversary proceedings and
retained Debtor's and Trustee's Claims brought or pursued by the
Reorganized Debtor.
9.6 Final Decree. Entry of a final decree closing Debtor's case.
DATED this 14th day of November, 1997.
By______________________________
Roger W. Brown, Trustee
Plan Proponent
By______________________________
William C. Taylor
Plan Proponent
