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Exhibit 10.181
UNITED STATES BANKRUPTCY COURT
DISTRICT OF NEW JERSEY
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In re: Case No. 00-14052 (JHW)
Capital Gaming International, Inc., Chapter 11
Debtor.
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FIRST AMENDED PLAN OF REORGANIZATION FOR CAPITAL GAMING
INTERNATIONAL, INC. JOINTLY PROPOSED BY THE DEBTOR AND
U.S. BANK TRUST NATIONAL ASSOCIATION, AS INDENTURE TRUSTEE,
DATED AS OF AUGUST 4, 2000
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OPPENHEIMER WOLFF & DONNELLY LLP GIBBONS, DEL DEO, DOLAN,
3300 PLAZA VII GRIFFINGER & VECCHIONE, P.C.
45 SOUTH SEVENTH STREET ONE RIVERFRONT PLAZA
MINNEAPOLIS, MINNESOTA 55402 NEWARK, NEW JERSEY 07102-5497
DUANE, MORRIS & HECKSCHER LLP
51 HADDONFIELD, SUITE 340
CHERRY HILL, NEW JERSEY 08002
COUNSEL FOR U.S. BANK TRUST COUNSEL FOR CAPITAL GAMING
NATIONAL ASSOCIATION, INTERNATIONAL, INC.
AS INDENTURE TRUSTEE
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Table of Contents
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I. PROPONENTS.............................................................1
II. DEFINITIONS............................................................1
III. PAYMENT OF POST-PETITION CLAIMS AND PRIORITY TAX CLAIMS................6
A. ADMINISTRATIVE CLAIMS.......................................6
B. PRIORITY TAX CLAIMS.........................................7
C. UNITED STATES TRUSTEE FEES..................................7
D. DEADLINE FOR FILING ADMINISTRATIVE CLAIMS...................7
IV. PAYMENT OF DIRECTOR FEES AND EXPENSES..................................7
V. CLASSIFICATION OF CLAIMS AND EQUITY INTERESTS..........................8
A. CLASS 1 - PRIORITY CLAIMS...................................8
B. CLASS 2 - SECURED CLAIMS....................................8
C. CLASS 3 - ALLOWED UNSECURED CLAIMS..........................8
D. CLASS 4 - TARDILY FILED CLAIMS..............................8
E. CLASS 5 - EQUITY INTERESTS..................................8
VI. TREATMENT OF CLAIMS AND INTERESTS......................................8
A. CLASS 1 - PRIORITY CLAIMS...................................8
B. CLASS 2 - SECURED CLAIMS....................................9
C. CLASS 3 - UNSECURED CLAIMS.................................10
D. CLASS 4 - TARDILY FILED CLAIMS.............................10
E. CLASS 5 - EQUITY INTERESTS.................................10
VII. IDENTIFICATION OF IMPAIRED CLASSES....................................10
A. UNIMPAIRED CLASSES.........................................10
B. IMPAIRED CLASSES...........................................10
VIII. MEANS FOR EXECUTING PLAN..............................................11
A. FUNDING OF PLAN............................................11
B. AMENDED ORGANIZATIONAL DOCUMENTS...........................11
C. CORPORATE ACTION...........................................11
IX. IMPLEMENTATION OF PLAN................................................12
A. BOARD OF DIRECTORS.........................................12
B. ALLOCATION AND DISTRIBUTION OF NEW STOCK...................12
1. NEW CLASS A COMMON STOCK..........................12
2. NEW CLASS B COMMON STOCK..........................12
3. EXEMPTION FROM FEDERAL SECURITIES LAWS............13
C. SURRENDER AND CANCELLATION OF OUTSTANDING SECURITIES.......13
1. ISSUANCE AND DISTRIBUTION OF NEW STOCK AND
CANCELLATION OF OLD STOCK.................. 13
2. SURRENDER AND CANCELLATION OF SENIOR NOTES........14
D. TERMINATION OF INDENTURE...................................15
E. LICENSES OR PERMITS........................................15
F. ALLOCATION OF MANAGEMENT SHARES............................15
G. ROUNDING...................................................16
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Table of Contents
(continued)
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H. LIMITATION ON TRANSFER OF NEW STOCK........................16
X. BANKRUPTCY ACTIONS....................................................16
XI. EFFECT OF CONFIRMATION................................................16
A. REVESTING OF PROPERTY......................................16
B. DISCHARGE..................................................16
C. RELEASES...................................................17
D. INJUNCTION.................................................18
E. INDEMNIFICATION............................................19
XII. CONDITIONS PRECEDENT..................................................19
A. CONDITIONS TO CONFIRMATION.................................19
B. CONDITIONS TO THE OCCURRENCE OF THE EFFECTIVE DATE.........19
C. WAIVER OF CONDITIONS.......................................19
XIII. POST-CONFIRMATION CLAIMS ADMINISTRATION...............................20
A. TIME PERIOD FOR FILING BANKRUPTCY ACTIONS AND OTHER
ADVERSARY PROCEEDINGS......................................20
B. RIGHT TO RECEIVE DISTRIBUTIONS.............................20
C. OBJECTIONS TO CLAIMS AND EQUITY INTERESTS..................20
D. DISPUTED CLAIMS AND EQUITY INTERESTS.......................20
E. UNCLAIMED DISTRIBUTIONS....................................21
XIV. EXECUTORY CONTRACTS AND UNEXPIRED LEASES..............................21
XV. RETENTION OF JURISDICTION.............................................22
A. SCOPE OF JURISDICTION......................................22
B. CONCURRENT WITH OTHER COURTS...............................22
XVI. MISCELLANEOUS PROVISIONS..............................................23
A. TERMINATION OF PROFESSIONALS...............................23
B. DISBURSING AGENT...........................................23
C. WITHHOLDING TAXES..........................................23
D. AMENDMENTS AND MODIFICATIONS...............................23
E. NOTICES....................................................23
F. HEADINGS...................................................23
G. EXHIBITS...................................................23
H. TIME PERIODS...............................................24
I. GOVERNING LAW..............................................24
J. SEVERABILITY...............................................24
K. SUCCESSORS AND ASSIGNS.....................................24
EXHIBITS.................................................................... 26
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I. PROPONENTS
Capital Gaming International, Inc. and U.S. Bank Trust National Association, as
Indenture Trustee, submit the following plan of reorganization pursuant to
section 1121 of the Bankruptcy Code for the Debtor (all capitalized terms shall
have the meanings set forth below).
II. DEFINITIONS
Except as otherwise defined below, all terms used in this Plan and defined under
section 101 of the Bankruptcy Code shall have the meanings set forth in section
101 of the Bankruptcy Code. Unless the context otherwise requires, all
capitalized terms in this Plan shall have the respective meanings specified
below, and such meanings shall be equally applicable to the singular and plural
forms of the terms defined.
"Actions" mean all rights, claims, and actions of the Debtor, including,
without limitation, all Bankruptcy Actions, other than those dismissed,
released, settled, or compromised under this Plan.
"Administrative Claim" means a claim or entitlement to treatment as an
administrative expense under section 503(b) of the Bankruptcy Code.
"Allowed" or "Allowed Claim" means any claim against the Debtor: (a) with
respect to which a proof of claim has been timely filed with the Bankruptcy
Court; or (b) which is (i) listed in the schedules of creditors that the Debtor
prepared and filed with the Bankruptcy Court pursuant to Bankruptcy Rule
1007(b), as amended up to the Confirmation Date, and (ii) not listed as
disputed, contingent, or unliquidated; or (c) a Tardily Filed Claim which
qualifies under section 726(a)(2)(C)(i) and (ii) of the Bankruptcy Code; or (d)
which is designated as an Allowed Claim in this Plan. In the case of (a), (b),
and (c), a claim is an Allowed Claim only if no objection to the allowance of
the claim has been raised within any applicable period for raising such an
objection, or the Bankruptcy Court enters a Final Order allowing the claim.
Unless otherwise specified in this Plan, the term "Allowed Claim" shall not
include interest on such claim for any period from and after the Petition Date,
unless sufficient funds are available under this Plan for payment of interest in
the priority specified under section 506 or 726 of the Bankruptcy Code.
"Allowed Administrative Claim" means an Administrative Claim with respect
to which: (a) the Debtor has determined such Administrative Claim should be paid
as an expense of administration under section 503(b) of the Bankruptcy Code; or
(b) the Bankruptcy Court has entered a Final Order allowing such Administrative
Claim, but only to the extent allowed under the Final Order.
"Allowed Equity Interest" means any interest in the Debtor: (a) with
respect to which a proof of interest has been timely filed with the Bankruptcy
Court; or (b) which is (i) listed in the schedules of the Debtor prepared and
filed with the Bankruptcy Court pursuant to Bankruptcy Rule 1007(b), as amended
up to the Confirmation Date, and (ii) not listed as disputed, contingent, or
unliquidated; or (c) which is designated as an Allowed Equity Interest in this
Plan. In the case of (a) and (b), an interest is an Allowed Equity Interest only
if no objection to the
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allowance of the interest has been raised within any applicable period for
raising such an objection, or the Bankruptcy Court enters a Final Order allowing
the interest.
"Amended Bylaws" mean the Amended Bylaws of the Reorganized Company, in
the form substantially similar to the form attached as Exhibit A to this Plan.
"Amended Certificate of Incorporation" means the Amended Certificate of
Incorporation of the Reorganized Company, in the form substantially similar to
the form attached as Exhibit B to this Plan.
"Amended Organizational Documents" mean the Amended Bylaws and Amended
Certificate of Incorporation of the Reorganized Company.
"Bankruptcy Actions" mean any and all rights of action of the Debtor under
sections 544, 545, 546, 547, 548, 549, and 550 of the Bankruptcy Code, or
similar state laws, other than those dismissed, released, settled, or
compromised under this Plan.
"Bankruptcy Code" means title 11 of the United States Code, as amended
from time to time.
"Bankruptcy Court" means the United States Bankruptcy Court for the
District of New Jersey, or such other court that may have jurisdiction over the
chapter 11 Case pursuant to 28 U.S.C. 157(d).
"Bankruptcy Rules" mean the Federal Rules of Bankruptcy Procedure, as
amended from time to time.
"Board of Directors" means the Board of Directors of the Reorganized
Company after the Effective Date, initially consisting of the individuals
identified in Article IX, Section A of this Plan.
"Business Day" means any day that is not a Saturday, Sunday, or legal
holiday as defined in Rule 6(a) of the Federal Rules of Civil Procedure.
"Case" means the chapter 11 case of the Debtor (Case No. 00-14052 (JHW))
commenced on May 15, 2000 and currently pending in the Bankruptcy Court.
"Cash" means any cash or cash equivalents, including, but not limited to,
bank deposits, checks, and other similar negotiable instruments.
"Claimant" means a Creditor or holder of an Equity Interest.
"Claims Bar Date" means the date established by order of the Bankruptcy
Court as the last date on which to file proofs of claims or interests.
"Confirmation Date" means the date the Confirmation Order is entered in
accordance with applicable provisions of the Bankruptcy Code.
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"Confirmation Order" means the order of the Bankruptcy Court confirming
this Plan and approving the transactions contemplated by this Plan.
"Covered Persons" means the Debtor and each of its wholly owned
subsidiaries as described in the Disclosure Statement related to this Plan,
together with their respective directors, officers, and employees as of the
Petition Date.
"Creditor" means any individual or entity that has a claim against the
Debtor.
"Debtor" means Capital Gaming International, Inc., a New Jersey
corporation, as debtor and debtor-in-possession.
"Deficiency Claim" means any claim of a Creditor against the Debtor equal
to the amount by which the aggregate claims of such Creditor against the Debtor
exceed the sum of (a) any setoff rights of the Creditor against the Debtor, plus
(b) the Net Proceeds realized from the disposition of any property of the Debtor
securing such claim or, if such property is not liquidated to cash, the value of
the interest of such Creditor in the property securing such claim. However, if
the class to which such claim belongs makes an election under section 1111(b) of
the Bankruptcy Code, there shall be no Deficiency Claim in respect of such
claim.
"Disclosure Statement" means the disclosure statement filed by the
Proponents in conjunction with this Plan and approved by the Bankruptcy Court.
"Disputed Claim" means any claim which is not an Allowed Claim.
"Disputed Equity Interest" means any interest which is not an Allowed
Equity Interest.
"Distributable Cash" means all cash of the Company, whether held by the
Indenture Trustee or the Company, in excess of Two Million Nine Hundred Thousand
Dollars ($2,900,000), determined after payment of all Plan distributions to
creditors and equity security holders, other than Class 2A Creditors.
"Effective Date" means the Business Day selected by the Debtor that is not
more than five (5) Business Days after the date each of the conditions precedent
to consummation as provided in Article XII of the Plan has been satisfied or
waived in accordance with the Plan.
"Equity Interest" means any issued and outstanding equity interest of the
Debtor, including any option, warrant, or right to purchase interests in the
Debtor, as of the Confirmation Date.
"Final Order" means an order or judgment which has not been reversed,
stayed, modified or amended and: (a) as to which (i) the time to appeal or seek
review or rehearing has expired and as to which no appeal or petition for
certiorari, review or rehearing is pending, or (ii) if appeal, review,
reargument or certiorari of the order has been sought, the order has been
affirmed or the request for review, reargument or certiorari has been denied and
the time to seek a further appeal, review, reargument or certiorari has expired;
and (b) as a result of which such order shall have become final and
nonappealable in accordance with applicable law.
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"Gaming License" means any material license, certification, franchise or
other authorization or approval to own, lease, operate or otherwise conduct,
manage, finance, consult with respect to, operate or develop riverboat,
dockside, land-based or any other type of gaming in any Gaming Jurisdiction, and
applicable liquor licenses.
"Gaming Jurisdiction" means any federal, state, tribal or sovereign nation
in which any entity in which the Debtor or Reorganized Debtor has a direct or
indirect beneficial, legal or voting interest, conducts or intends to conduct,
manage, finance, consult with respect to, operate or develop riverboat,
dockside, land-based or any other type of gaming (including, without limitation,
the rendering of services in respect thereof pursuant to a Native American
Casino Management Contract (as such term is defined in the Indenture) or
otherwise).
"Indenture" means the Second Amended and Restated Indenture relating to
the Senior Notes between the Debtor and the Indenture Trustee dated as of
February 17, 1994, and amended and restated as of March 27, 1997, and amended
and restated as of December 4, 1998.
"Indenture Trustee" means U.S. Bank Trust National Association, as
indenture trustee for the holders of the Senior Notes pursuant to the terms of
the Indenture, or any other successor trustee appointed under the Indenture.
"Indenture Trustee Fees and Expenses" mean all fees and expenses of the
Indenture Trustee, including all fees and expenses of counsel for the Indenture
Trustee, whether before or after the Petition Date, which would constitute a
claim subject to the charging lien of the Indenture Trustee under the Indenture
or other applicable agreement.
"Internal Revenue Code" means title 26 of the United States Code, as
amended, and the corresponding provisions of applicable foreign, state, and
local tax laws, including all Treasury regulations promulgated under such
statutes.
"Local Rules" mean the Local Rules of the United States Bankruptcy Court
for District of New Jersey, as amended from time to time.
"Management Group" means Michael W. Barozzi, Charles B. Brewer, and
William S. Papazian.
"Management Shares" mean the 132,000 shares of Class B Common Stock to be
issued to the Management Group pursuant to Article IX, Section F of this Plan.
"Net Proceeds" mean all funds recovered on account of liquidating any
claim or other asset of the Debtor, less the fees and expenses of liquidating
such claim or other asset.
"New Class A Common Stock" means the 2,068,000 shares of Class A Common
Stock of the Reorganized Company issued pursuant to Article IX, Section B of
this Plan.
"New Class B Common Stock" means the 132,550 shares of Class B Common
Stock of the Reorganized Company issued pursuant to Article IX, Section B of
this Plan.
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"New Stock" means the New Class A Common Stock and the New Class B Common
Stock, collectively.
"Old Class A Common Stock" means the Debtor's stock designated as Class A
Common Stock authorized, issued, and outstanding as of the Petition Date.
"Old Common Stock" means the Debtor's stock designated as Common Stock
authorized, issued, and outstanding as of the Petition Date.
"Old Stock" means, collectively, the Old Class A Common Stock and the Old
Common Stock.
"Petition Date" means May 15, 2000.
"Plan" means this plan of reorganization, including all attached exhibits,
as it may be modified or amended from time to time pursuant to section 1127 of
the Bankruptcy Code.
"Priority Claim" means any claim entitled to priority treatment under
section 507 of the Bankruptcy Code, except any Administrative Claim and Priority
Tax Claim.
"Priority Tax Claim" means any claim entitled to priority treatment under
section 507(a)(8) of the Bankruptcy Code.
"Professionals" mean any professionals employed in this Case pursuant to
sections 327 or 1103 of the Bankruptcy Code.
"Proponents" mean the Debtor and the Indenture Trustee.
"Pro Rata" means, as to any distribution provided for by this Plan in
respect of any class of claims, the allocation of the aggregate amount of such
distribution in accordance with that percentage of the total of Allowed Claims
in such class that is represented by the Allowed Claim receiving the
distribution.
"Record Date" means the Confirmation Date, or such later date fixed in the
Confirmation Order.
"Reorganized Company" means the Debtor after the Effective Date of this
Plan.
"SEC" means the Securities and Exchange Commission.
"Secured Claim" means any Allowed Claim of a Creditor that is determined
to be secured pursuant to section 506 of the Bankruptcy Code, or is allowed as a
secured claim pursuant to this Plan.
"Securities Act of 1933" means the Securities Act of 1933, as amended,
codified at 15 U.S.C. Sections 77a et seq.
"Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended, codified at 15 U.S.C. Sections 78a et seq.
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"Securities Laws" mean the Securities Act of 1933, the Securities Exchange
Act, and any applicable state or local securities laws.
"Senior Noteholder Claims" mean any and all claims, rights, liens, and
interests evidenced by the Senior Notes and the Indenture.
"Senior Noteholders" mean holders of the Senior Notes.
"Senior Notes" mean the Debtor's 12% Senior Secured Notes due 2001 issued
by the Debtor under the Indenture.
"Tardily Filed Claim" means any claim that would be an Allowed Claim but
for the fact that proof of such claim was required to be filed and was not filed
or deemed to be filed within applicable time periods for filing such claims.
Unless the Bankruptcy Court orders otherwise, any claim filed after the Claims
Bar Date shall be deemed a Tardily Filed Claim.
"Tax Return" means all returns, information returns, declarations,
reports, statements, elections, and other documents required to be filed or
furnished in respect of Taxes.
"Taxes" mean all federal, state, local, foreign and other net income,
gross income, gross receipts, sales, use, ad valorem, transfer, franchise,
profits, license, lease, service, service use, withholding, payroll, employment,
excise, severance, stamp, occupation, premium, property, windfall profits,
customs, duties, or other taxes, fees, assessments or charges of any kind
whatsoever, against the Debtor or the properties or businesses thereof, together
with any interest and any penalties, additions to tax or additional amounts with
respect thereto.
"Transfer Agent" means American Stock Transfer or such other transfer
agent as the Reorganized Company may designate.
"United States Trustee" means the United States Trustee for the District
of New Jersey.
"Unsecured Claim" means any claim (including any Deficiency Claim) that is
not an Administrative Claim, a Priority Tax Claim, a Priority Claim, or a
Secured Claim.
"Unsecured Creditor" means a Creditor holding an Allowed Unsecured Claim.
"Unsecured Creditors' Committee" means the Committee of Unsecured
Creditors, if any, appointed by the U.S. Trustee in this Case.
III. PAYMENT OF POST-PETITION CLAIMS AND PRIORITY TAX CLAIMS
A. ADMINISTRATIVE CLAIMS
Unless the Debtor and the holder of such claim agree otherwise, all Allowed
Administrative Claims under sections 503(b) and 507(a)(1) of the Bankruptcy Code
against the Debtor and the Indenture Trustee Fees and Expenses shall be paid in
full, in cash, on or as soon as practicable after the later of (a) the Effective
Date of this Plan, or (b) the date that any such Administrative Claim becomes an
Allowed Administrative Claim.
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B. PRIORITY TAX CLAIMS
Unless the Debtor and the holder of such claim agree otherwise, all holders of
Allowed Priority Tax Claims against the Debtor shall be paid in full, in cash,
on or as soon as practicable after the later of (a) the Effective Date of this
Plan, or (b) the date on which such claim shall become due and payable in
accordance with its terms.
C. UNITED STATES TRUSTEE FEES
Except as previously ordered by the Bankruptcy Court, all fees payable to the
United States Trustee under 28 U.S.C. Section 1930 shall be paid as set forth in
this section.
The Debtor shall pay to the United States Trustee the appropriate sum required
by 28 U.S.C. Section 1930(a)(6) on or before the Effective Date, and
simultaneously provide the United States Trustee an appropriate affidavit
indicating the cash disbursements for any relative period in which the Debtor
has failed to file monthly operating reports.
The Reorganized Company shall timely pay to the United States Trustee any and
all post-confirmation quarterly fees as required by 28 U.S.C. Section 1930(a)(6)
until such time as the Case is converted, dismissed or closed by the Bankruptcy
Court. Additionally, the Reorganized Company shall submit to the United States
Trustee post-confirmation monthly operating reports in the format prescribed by
the United States Trustee until such time as the Case is converted, dismissed or
closed by the Bankruptcy Court.
The United States Trustee shall be exempt from any provision in this Plan which
may require the filing of a proof of claim by the United States Trustee as a
condition precedent to receiving payment for any quarterly fees due pursuant to
28 U.S.C. Section 1930(a)(6).
D. DEADLINE FOR FILING ADMINISTRATIVE CLAIMS
Unless the Bankruptcy Court sets an earlier deadline, all holders of
Administrative Claims, including, but not limited to, claims of Professionals
and other persons requesting compensation for services rendered or reimbursement
of expenses under section 330 of the Bankruptcy Code or seeking compensation and
reimbursement for making a substantial contribution under subsections 503(b)(3)
or (b)(5) of the Bankruptcy Code, shall file and serve on the Reorganized
Company (and other parties in interest as provided in the Bankruptcy Rules and
Local Rules) an application for final allowance of such Administrative Claims no
later than thirty (30) days after entry of the Confirmation Order. Any
application for an Administrative Claim not filed within the time periods set by
the Bankruptcy Court shall be disallowed, unless, prior to the expiration of any
applicable time period, the Bankruptcy Court extends the time period after
notice and a hearing.
IV. PAYMENT OF DIRECTOR FEES AND EXPENSES
All fees and expenses of the pre-petition or post-petition board of directors of
the Debtor that are due and owing prior to the Confirmation Date shall be paid
on the Effective Date.
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V. CLASSIFICATION OF CLAIMS AND EQUITY INTERESTS
A. CLASS 1 - PRIORITY CLAIMS
Class 1 shall consist of all Allowed Priority Claims against the Debtor.
B. CLASS 2 - SECURED CLAIMS
Class 2A shall consist of the Allowed Secured Claims of Senior Noteholders
against the Debtor.
Class 2B shall consist of all other Allowed Secured Claims, if any, against the
Debtor, not otherwise classified in this Plan. For purposes of voting and
treatment, each holder of an Allowed Secured Claim in Class 2B shall be
designated as a separate class and assigned a separate class number beginning
with Class 2B-1, Class 2B-2, and so on with respect to their Allowed Secured
Claims against the Debtor.
C. CLASS 3 - ALLOWED UNSECURED CLAIMS
Class 3A shall consist of all Allowed Unsecured Claims against the Debtor,
including the Deficiency Claim of Senior Noteholders.
Class 3B shall consist of the Allowed Unsecured Claims against the Debtor in the
amount of Two Thousand Five Hundred Dollars ($2,500) or less, or claims for a
larger amount which are voluntarily reduced, at the election of the holder to
such claim, to Two Thousand Five Hundred Dollars ($2,500).
D. CLASS 4 - TARDILY FILED CLAIMS
Class 4 shall consist of all Tardily Filed Claims against the Debtor.
E. CLASS 5 - EQUITY INTERESTS
Class 5A shall consist of the Allowed Equity Interests of holders of the
Debtor's Old Class A Common Stock.
Class 5B shall consist of all Allowed Equity Interests in the Debtors other than
the Old Class A Common Stock, including without limitation, the Old Common
Stock.
VI. TREATMENT OF CLAIMS AND INTERESTS
All Allowed Claims against and Equity Interests in the Debtor shall be treated
as follows and all distributions under this Plan shall be free and clear of all
liens, claims, and encumbrances, except as expressly provided in this Plan.
A. CLASS 1 - PRIORITY CLAIMS
Unless the Debtor and the holder of such claim agree otherwise, all Class 1
Priority Claims shall be paid in full, in cash, on or as soon as practicable
after the later of: (a) the Effective Date of this Plan, and (b) the date that
any such Priority Claim becomes an Allowed Priority Claim.
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B. CLASS 2 - SECURED CLAIMS
CLASS 2A - SENIOR NOTEHOLDERS SECURED CLAIMS
On the Confirmation Date, the Class 2A Secured Claims of Senior Noteholders
shall be deemed Allowed Secured Claims in the amount of Thirteen Million Eleven
Thousand Nine Hundred and Twenty Dollars ($13,011,920). In full satisfaction of
their Allowed Secured Claims, each Class 2A Creditor as of the Record Date shall
receive a Distribution equal to its Pro Rata share of (a) the greater of (i)
Nine Million Dollars ($9,000,000) or (ii) the Distributable Cash (after payment
of Indenture Trustee Fees and Expenses as provided below) and (b) Two Million
Sixty-Eight Thousand (2,068,000) shares of New Class A Common Stock,
representing approximately ninety-four percent (94%) of the aggregate voting
securities of the Reorganized Company; provided, however, that no distribution
will be made on account of any Senior Notes held by the Debtor, either directly
or indirectly, and any distribution attributable to such Senior Notes will be
deemed waived and distributed to the other holders of the Senior Notes.
All liens and security interests securing the Senior Notes on assets of the
Debtor or any guarantor (which will become assets of the Reorganized Company
under this Plan) and all guaranties shall be deemed discharged and released on
the Effective Date without any further action of the Debtor, the Indenture
Trustee, or the individual holders of the Senior Notes; provided, however, that
all liens and interests securing the Senior Notes shall survive for purposes of
establishing the extent and priority of any other Secured Claims against the
Debtor.
All distributions to holders of the Class 2A Secured Claims shall be paid to the
Indenture Trustee and shall be distributed as provided under the Indenture. All
rights and liens of the Indenture Trustee shall attach to any property
distributable to holders of the Senior Notes, including, but not limited to, the
charging liens of the Indenture Trustee under the Indenture. The Indenture
Trustee Fees and Expenses will be paid from Distributable Cash prior to the
distribution to Class 2A Creditors. Except as otherwise provided in this Plan,
all distributions to Class 2A Creditors shall be free and clear of any claims,
rights, liens and interests of the Creditors and holders of Equity Interests.
CLASS 2B -- MISCELLANEOUS SECURED CLAIMS
In full satisfaction of their Allowed Secured Claim, each holder of a Class 2B
Secured Claim shall: (a) receive the amount of its respective Secured Claim as
calculated pursuant to section 506 of the Bankruptcy Code from the Net Proceeds
from liquidating the property subject to its respective Secured Claim; (b)
receive all right, title, and interest of the Debtor in and to any property of
the Debtor pledged to secure such Secured Claim; or (c) retain its interest in
and to any property of the Debtor pledged to secure such Secured Claim, and
receive on account of such Secured Claim deferred cash payments totaling the
amount of such Allowed Secured Claim and having a value, as of the Effective
Date, equal to the value of such holder's interest in any property of the Debtor
pledged to secure such Secured Claim. Any Cash payable under part (a) or (b) of
the preceding sentence on account of the Allowed Secured Claims in Class 2B
shall be paid in full, in cash, on the later of: (a) the Effective Date of this
Plan; (b) the date that any such claim becomes an Allowed Claim; or (c) the date
the property securing such claim is liquidated.
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Any Allowed Deficiency Claims of a Class 2B Creditor shall be treated as part of
the Class 3B Unsecured Claims.
C. CLASS 3 - UNSECURED CLAIMS
CLASS 3A - GENERAL UNSECURED CLAIMS
Each Class 3A Claimant shall receive a Distribution equal to its Pro Rata share
of One Hundred Thousand Dollars ($100,000) in cash. On the Confirmation Date,
the Deficiency Claim arising from the Senior Notes shall be deemed an Allowed
Unsecured Claim in the amount of Eleven Million Four Hundred Seventy-Four
Thousand and Eighty Dollars ($11,474,080) (principal and interest due under the
Senior Notes of $24,486,000, less the Class 2A distribution of $13,011,920).
CLASS 3B - ADMINISTRATIVE CONVENIENCE CLAIMS
Each Allowed Class 3B Claim shall be paid in full, in cash, on the later of the
Effective Date or in accordance with the agreement or terms governing such
claim.
D. CLASS 4 - TARDILY FILED CLAIMS
Class 4 Creditors shall receive nothing on account of such claims.
E. CLASS 5 - EQUITY INTERESTS
Class 5A Claimants shall receive nothing on account of their Allowed Equity
Interests. On the Effective Date, all outstanding Class 5A Equity Interests of
the Debtor will be canceled, annulled, and extinguished.
Class 5B Claimants shall receive their Pro Rata share of five hundred fifty
(550) shares of New Class B Common Stock on account of their Allowed Equity
Interests; provided, however, that no shares of New Class B Common Stock will be
distributed on account of an Allowed Equity Interest owned, directly or
indirectly, by an insider of the Debtor and any distribution attributable to
such Allowed Equity Interests will be deemed waived and distributed to the other
holders of the Old Common Stock. On the Effective Date, all outstanding Class 5B
Equity Interests of the Debtor will be canceled, annulled, and extinguished.
VII. IDENTIFICATION OF IMPAIRED CLASSES
A. UNIMPAIRED CLASSES
Classes 1, 2B, and 3B are not impaired under this Plan.
B. IMPAIRED CLASSES
Classes 2A, 3A, 4, 5A, and 5B are impaired under this Plan, and all holders of
Allowed Claims in such classes may vote to accept or reject this Plan. A class
of claims shall have accepted this Plan if at least two-thirds (2/3) in dollar
amount and more than one-half (1/2) in number of
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<PAGE> 14
holders in such class who have voted on this Plan, have voted to accept this
Plan. A class of Equity Interests shall have accepted the Plan if at least
two-thirds (2/3) in amount of holders in such class who have voted on the Plan,
have voted to accept the Plan.
Pursuant to section 1126(g) of the Bankruptcy Code, a class of claims or
interests shall be deemed to have rejected a plan if such class will receive or
retain no property of the Debtor under the terms of the plan. Accordingly, Class
4 Tardily Filed Claims and Class 5A Equity Interests shall be deemed to reject
this Plan and the Proponents will seek confirmation of this Plan under section
1129(b) of the Bankruptcy Code with respect to such Classes 4 and 5A. Although
Class 5B will receive a distribution under the Plan, the Proponents will seek an
order from the Bankruptcy Court that Class 5B shall be deemed to reject the
Plan.
VIII. MEANS FOR EXECUTING PLAN
A. FUNDING OF PLAN
All payments of Cash that are to be made on or after the Effective Date of this
Plan shall be made by the Reorganized Company from Cash on hand (including cash
collateral held by the Indenture Trustee) as of the Effective Date. On the
Effective Date any Cash in excess of Fifty Thousand Dollars ($50,000) held by
CGMI shall be transferred to the Reorganized Company.
B. AMENDED ORGANIZATIONAL DOCUMENTS
As of the Effective Date, the Amended Organizational Documents shall be
authorized and approved in all respects, and shall become the organizational
documents of the Reorganized Company without any further action of the Debtor,
the Reorganized Company or the Bankruptcy Court. The Amended Certificate of
Incorporation prohibits the issuance of non-voting equity securities in
accordance with section 1123 of the Bankruptcy Code. On and after the Effective
Date, the Reorganized Company shall be authorized and directed under this Plan
and the Confirmation Order to file the Amended Certificate of Incorporation with
the Secretary of State or other appropriate officer for the State of New Jersey.
C. CORPORATE ACTION
The adoption of the Amended Organizational Documents, the initial selection of
the Board of Directors of the Reorganized Company, the issuance of the New
Stock, and all matters under this Plan involving the organizational structure of
the Reorganized Company or corporate action to be taken by or required of the
Reorganized Company to implement this Plan shall be deemed to have occurred and
be effective as provided in this Plan, shall be authorized and approved in all
respects without any further action by the stockholders or the Board of
Directors of the Debtor, and the Board of Directors of the Reorganized Company
shall be authorized and directed to execute and deliver any such documents,
including, but not limited to (a) the Amended Certificate of Incorporation, (b)
the Amended Bylaws, and (c) any other documents necessary to implement this
Plan.
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<PAGE> 15
IX. IMPLEMENTATION OF PLAN
A. BOARD OF DIRECTORS
The Board of Directors of the Reorganized Company shall initially consist of
three (3) directors; provided, however, that, subject to the discretion of the
Board of Directors and in accordance with the Amended Bylaws, the Board of
Directors of the Reorganized Company may be expanded to no more than seven (7)
directors. On the Effective Date, the following individuals shall be appointed
and authorized to act as the Board of Directors of the Reorganized Company:
<TABLE>
<CAPTION>
NAME DIRECTORSHIP
<S> <C>
Michael W. Barozzi Common Director
Charles B. Brewer Class A Director
Col. Clinton L. Pagano Common Director
William S. Papazian Common Director
</TABLE>
Subject to the terms and conditions of the Amended Organizational Documents, the
Board of Directors shall have complete authority for management and operation of
the Reorganized Company. No member of the Board of Directors shall be removed
for a period of one (1) year following the Effective Date unless cause exists or
such removal is directed by the affirmative vote of a majority of stockholders
entitled to appoint such director. Director vacancies shall be filled as
provided in the Amended Bylaws. Colonel Pagano shall serve as a Common Director
until the expiration of his term of office on December 31, 2000. Thereafter, the
composition and voting rights of the Board of Directors will be adjusted as
provided in the Amended Certificate of Incorporation.
As Chairman of the Board, Charles B. Brewer shall receive 22,000 shares of Class
B Common Stock representing approximately one percent (1%) of the voting
securities of the Reorganized Company outstanding on the Effective Date.
B. ALLOCATION AND DISTRIBUTION OF NEW STOCK
1. NEW CLASS A COMMON STOCK
Confirmation of this Plan shall constitute approval for 3,000,000 shares of New
Class A Common Stock of the Reorganized Company to be authorized under the
Amended Certificate of Incorporation. Of the 3,000,000 authorized shares,
2,068,000 shares of New Class A Common Stock shall be distributed to Class 2A
Creditors under this Plan.
As soon as practical after the Effective Date, the Indenture Trustee shall
distribute certificates representing the Pro Rata portion of the authorized New
Class A Common Stock to Class 2A Creditors, rounded down to the nearest whole
share allocable to any Creditor (no fractional shares will be distributed to any
Creditor).
2. NEW CLASS B COMMON STOCK
Confirmation of this Plan shall constitute approval for 2,000,000 shares of New
Class B Common Stock of the Reorganized Company to be authorized under the
Amended Certificate of
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<PAGE> 16
Incorporation. Of the 2,000,000 authorized shares, 132,000 shares of New Class B
Common Stock will be issued to the Management Group pursuant to Article IX,
Sections A and F, and 550 shares of New Class B Common Stock will be issued to
the holders of Equity Interests classified in Class 5B.
3. EXEMPTION FROM FEDERAL SECURITIES LAWS
The distribution of the New Stock under this Plan is intended to be exempt from
registration under applicable Securities Laws pursuant to section 1145 of the
Bankruptcy Code. Unless waived by the Reorganized Company in its sole and
absolute discretion, no New Stock shall be distributed under this Plan until and
unless: (a) the Bankruptcy Court has entered a Final Order finding that the
distribution of the New Stock under this Plan is exempt from registration under
section 5 of the Securities Act of 1933 and any applicable state or local law
requiring registration; or (b) a no-action letter has been obtained from the SEC
advising that no action will be taken by the SEC in the event that the New Stock
is issued and distributed under this Plan without registering such New Stock
pursuant to the Securities Act of 1933; or (c) the New Stock has been
appropriately registered under the Securities Act of 1933 and all applicable
rules and regulations, and any other applicable securities laws.
C. SURRENDER AND CANCELLATION OF OUTSTANDING SECURITIES
1. ISSUANCE AND DISTRIBUTION OF NEW STOCK AND CANCELLATION OF OLD
STOCK
(a) On the Effective Date, the Reorganized Company shall issue the
aggregate amount of 2,200,550 shares of New Stock in
accordance with the terms of the Plan. The New Stock shall be
subject to the provisions and restrictions of the Amended
Organizational Documents.
(b) On the Effective Date, all Old Stock and all unexercised
rights to acquire shares of common stock or preferred stock of
the Debtor by way of option, warrant or other legal or
contractual rights shall be automatically canceled and deemed
to be void.
(c) As of the close of business on the Record Date, the transfer
ledgers for Old Stock shall be closed, and there shall be no
further changes in the record holders of any such securities.
The Debtor shall have no obligation to recognize any transfer
of any of the Old Stock occurring on or after the Record Date.
The Debtor and the Transfer Agent shall be entitled to
recognize and deal for all purposes hereunder with only those
record holders stated on the transfer ledgers of the Transfer
Agent as of the close of business on the Record Date.
(d) The holder of each Class 5B Allowed Equity Interest shall not
be entitled to any distribution under this Plan unless and
until such holder shall have first surrendered, or caused to
be surrendered, to the Reorganized Company (or any transfer
agent designated by the Reorganized Company) the original such
security held by it or, in the event that such original
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<PAGE> 17
security shall have been lost, destroyed, stolen or mutilated,
executed and delivered an affidavit of loss and indemnity with
respect thereto in form customarily utilized for such purposes
that is reasonably satisfactory to the Reorganized Company
and, in the event the Reorganized Company so requests,
furnished a bond in form and substance (including, without
limitation, amount) reasonably satisfactory to the Reorganized
Company. Any holder of Old Common Stock which shall not have
surrendered or have been deemed to surrender instruments or
certificates representing its Allowed Equity Interest within
one hundred eighty (180) days after the Effective Date, shall
have its Allowed Equity Interest disallowed, shall receive no
distribution on account of such Allowed Equity Interest under
this Plan, and shall be forever barred from asserting any
claim on account of its Allowed Equity Interest.
2. SURRENDER AND CANCELLATION OF SENIOR NOTES
As a condition to receiving the Cash and New Class A Common Stock distributable
under this Plan, holders of the Senior Notes shall surrender such instruments to
the Indenture Trustee. Upon surrender of the instruments, holders will receive
their Pro Rata share of the Cash and New Class A Common Stock distributable to
Class 2A. When a Senior Noteholder surrenders its Senior Notes to the Indenture
Trustee, the Indenture Trustee shall hold such instrument in "book entry only"
until termination of the Indenture, whereupon such instruments shall be
canceled.
Any holder of a Senior Note which has been lost, stolen, mutilated or destroyed,
shall, in lieu of surrendering such instrument, deliver to the Indenture Trustee
(a) evidence satisfactory to the Indenture Trustee of the loss, theft,
mutilation, or destruction of such instrument, and (b) such security or
indemnity that may be reasonably required by the Indenture Trustee to hold such
trustee harmless with respect to any such representation of the holder. Upon
compliance with the preceding sentence, such holder shall, for all purposes
under this Plan, be deemed to have surrendered such instrument.
Any holder of a Senior Note which shall not have surrendered or have been deemed
to surrender instruments or certificates representing its Senior Noteholder
Claim within one hundred eighty (180) days after the Effective Date, shall have
its Senior Noteholder Claim disallowed, shall receive no distribution on account
of such Senior Noteholder Claim under this Plan, and shall be forever barred
from asserting any claim on account of its Senior Noteholder Claim. Any cash or
stock reserved for distribution on account of such disallowed Senior Noteholder
Claim will be returned to the Company
As of the Effective Date, all instruments evidencing Senior Noteholder Claims
against the Debtor, on the Effective Date, shall represent only the right to
participate in the distributions provided in this Plan on account of such Senior
Noteholder Claims; provided, however, that the Senior Notes shall in addition
represent all rights, claims, and interests which they previously represented
unless specifically settled or compromised under this Plan.
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<PAGE> 18
D. TERMINATION OF INDENTURE
The Indenture shall terminate as of the Effective Date pursuant to section
1123(a)(5)(F) of the Bankruptcy Code, except as necessary to administer the
rights, claims, liens, and interests of the Indenture Trustee and Senior
Noteholders (including, to preserve and pursue any claims, rights, or interests
of the Indenture Trustee under the Indenture). The Debtor and the Indenture
Trustee shall have no further obligation under the Indenture and shall be
relieved of all obligations under the Indenture relating to the Senior Notes,
except with respect to the payments required to be made to the Indenture Trustee
in respect of its claims, or with respect to such other rights of the Indenture
Trustee that, pursuant to the terms of the Indenture, survive the termination of
the Indenture. Termination of the Indenture shall not impair the rights of any
Senior Noteholders pursuant to this Plan, and shall not impair the rights of the
Indenture Trustee to enforce its charging liens, created in law or pursuant to
the Indenture, against the assets securing the Senior Notes or property that
would otherwise be distributed to holders of the Senior Notes. Upon termination
of the Indenture, and without further action or order of the Bankruptcy Court,
the charging liens of the Indenture Trustee shall attach to any property
distributable to Senior Noteholders under this Plan with the same priority,
dignity, and effect that such liens had on property distributable under the
Indenture. Termination of the Indenture and related collateral documents shall
not impair the validity or priority of the Indenture Trustee's liens against and
interests in the assets of the Debtor or the Reorganized Company that originally
secured the Senior Notes.
E. LICENSES OR PERMITS
Any and all licenses, permits or other regulatory approvals of the Debtor shall
be retained and made applicable to the Reorganized Company without further
action of the Debtor or the Reorganized Company.
F. ALLOCATION OF MANAGEMENT SHARES
In order to provide an incentive to the Management Group, the Reorganized
Company shall distribute to the Management Group the Management Shares,
representing six percent of the aggregate voting securities of the Reorganized
Company. Michael W. Barozzi and William S. Papazian each will receive 55,000
shares of the Management Shares, and Charles B. Brewer will receive 22,000
shares of the Management Shares. Ownership of the Management Shares will vest as
follows: (i) one third will vest immediately on the Effective Date; (ii) one
third will vest on the first anniversary of the Effective Date; and (iii) the
final one third will vest on the second anniversary of the Effective Date. All
unvested shares of the Management Shares, and dividends accrued thereon, shall
be placed in escrow for their respective owners. If such owner voluntarily
leaves his employment for any reason or is terminated with cause prior to the
vesting date, then such owner shall lose all accumulated rights to such unvested
stock and accrued dividends. If the Reorganized Company or any of its
subsidiaries is sold, the stock shall vest immediately upon closing of the sale.
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<PAGE> 19
G. ROUNDING
Whenever any payment of a fraction of a cent would otherwise be called for, the
actual payment shall reflect a rounding down of such fraction to the nearest
whole cent. To the extent Cash remains undistributed as a result of the rounding
down of such fraction to the nearest whole cent, such Cash shall be treated as
unclaimed property and returned to the Reorganized Company. Whenever any
distribution of a fraction of a share of New Stock would otherwise be called
for, the actual distribution will reflect a rounding down of such fraction down
to the nearest whole number of shares; provided, however, that any fractional
share of Class B Common Stock distributable to members of Class 5B shall be
rounded up to the next whole share. Shares of New Stock not distributed because
of this provision of this Plan will be treated as unclaimed property and
returned to the Reorganized Company for cancellation.
H. LIMITATION ON TRANSFER OF NEW STOCK
The Amended Certificate of Incorporation contains significant restrictions on
the transferability of the New Stock intended to preserve the Debtor's tax
attributes and its gaming licenses. These restrictions may impair
transferability and market value of the New Stock. The Amended Certificate of
Incorporation is incorporated herein by reference.
X. BANKRUPTCY ACTIONS
On the Effective Date, all of the Debtor's right, title, and interest in and to
the Bankruptcy Actions shall be transferred to the Reorganized Company. The
Reorganized Company shall investigate and file any Bankruptcy Action that it
determines, in its sole and absolute discretion, is likely to result in a
recovery greater than the estimated fees and expenses necessary to pursue such
Bankruptcy Action. The Board of Directors of the Reorganized Company shall
determine in its sole discretion whether to distribute the Net Proceeds from
pursuing any Bankruptcy Action in the form of dividends to holders of the New
Stock.
XI. EFFECT OF CONFIRMATION
A. REVESTING OF PROPERTY
Except as otherwise expressly provided herein, on the Effective Date, title to
all property of the Debtor's estate shall revest in the Debtor (except as set
forth in the Plan) free and clear of all liens, claims, charges and interests
arising on or before the Confirmation Date and other rights and interests of
holders of claims and interests. Subject to the provisions of the Plan, the
Reorganized Company may continue in existence free of any restriction imposed by
the Bankruptcy Code or the Bankruptcy Court.
B. DISCHARGE
Except as otherwise provided herein or in the Confirmation Order, the occurrence
of the Effective Date shall operate as a discharge, pursuant to section
1141(d)(1) of the Bankruptcy Code, effective as of the Effective Date, of any
and all debts of and claims against the Debtor that arose at any time prior to
the Confirmation Date, including, but not limited to, all principal and
interest, whether accrued before, on or after the Filing Date, any and all
liabilities or
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<PAGE> 20
obligations of the Debtor under the Old Indenture. On and after the Effective
Date, as to every discharged debt and claim, the person that held such debt or
claim shall be precluded from asserting against the Reorganized Company, or
against the Reorganized Company's assets or properties, any other or further
claim based upon any document, instrument or act, omission, transaction or other
activity of any kind or nature that occurred prior to the Confirmation Date.
C. RELEASES
Except as otherwise provided in the Plan, the Covered Persons are released from
any and all claims or liabilities (including claims by the Debtor), arising from
actions taken in their capacity as such, and from any and all claims,
obligations, rights, causes of action and liabilities which any holder of a
claim against or interest in the Debtor may be entitled to assert, whether known
or unknown, foreseen or unforeseen, existing or hereafter arising based in whole
or in part upon any act or omission, transaction or other occurrence taking
place on or before the Effective Date in any way relating to the Debtor, the
Chapter 11 Case, or the Plan, including, without limitation, any claims of
equitable subordination or similar assertions; provided that such releases shall
exclude claims arising from willful misconduct, gross negligence or defalcation.
(a) Except as otherwise expressly provided herein or the
Confirmation Order, on the Effective Date, each holder of any
claim against the Debtor receiving, or entitled to receive,
payments or distributions pursuant to the Plan on account of
such claim, shall be deemed to have forever waived, released
and discharged all rights, causes of action and claims, in law
or in equity, whether based on tort, fraud, contract or
otherwise, which they heretofore or hereafter possessed or may
possess against any Covered Person arising in any manner from
(i) the issuance, offering or sale of any interest in any of
the Senior Notes or the amendment of any term of the
Indenture, (ii) the disclosure made by any Covered Person in
any document used in connection with the issuance, offering or
sale of any interest in any of the Senior Notes, or the
amendment of any term of the Indenture, (iii) the due
diligence undertaken by any Covered Person in connection with
the issuance, offering and sale of any interest in any of the
Senior Notes or the amendment of any term of the Indenture, or
(iv) as against any Covered Person, such holder's acquisition,
ownership or disposition of any interest in any of the Senior
Notes (together, the "Released Claims"). From and after the
Effective Date, any such right, cause of action or claim
against any Covered Person shall, without the necessity for
any further action by, or notice to, any holder, automatically
be relinquished, conceded, extinguished, canceled and
terminated as a result of the waiver, release and discharge
contained in this Article XI and the Confirmation Order shall
provide that such holders, with respect to any such rights,
causes of action and claims, will be permanently enjoined on
and after the Effective Date from acting or proceeding in any
manner, including without limitation, commencing, conducting
or continuing in any manner, directly or indirectly any suit,
action or proceeding of any kind (including, without
limitation, any thereof in a judicial, arbitral,
administrative or other forum against any Covered Person) in
derogation
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of the release contemplated by this Article XI, provided that
the foregoing, solely as to any Covered Person, may be subject
to review by the court having jurisdiction in respect of such
proceeding.
(b) Following the Effective Date, neither the Debtor, the
Reorganized Company, the Creditors' Committee, if any, the
Indenture Trustee, nor any of the members of such committee,
nor any of their respective officers, directors, employees or
agents (acting in such capacity), nor any professional persons
employed by any of them, shall have or incur any liability or
obligation to any person for any action taken or omitted to be
taken in connection with or related to the formulation,
preparation, dissemination, implementation, confirmation or
consummation of the Plan, the related Disclosure Statement, or
any contract, release, or other agreement or document created
or entered into, or any other action taken or omitted to be
taken in connection with the Plan; provided, however, that the
provisions of this sentence shall have no effect on the
liability of any person that would otherwise result from an
action or omission to the extent that such action or omission
is determined in a Final Order to have constituted gross
negligence or willful misconduct.
D. INJUNCTION
Except as otherwise expressly provided herein, the Confirmation Order will
provide that, following the Effective Date, all persons who have held, hold or
may hold claims against or interests in the Debtor, with respect to any such
claim or interest, shall be permanently enjoined on and after the Effective Date
from: (a) commencing, conducting or continuing in any manner any suit, action or
other proceeding of any kind (including, without limitation, any thereof in a
judicial, arbitral, administrative or other forum) against the Debtor or
Reorganized Company, any of its property, or any direct or indirect transferee
of any property of, or direct or indirect successor in interest to, any of the
foregoing persons, or any property of any such transferee or successor, (b)
enforcing, levying, attaching (including, without limitation, any pre-judgment
attachment), collecting or otherwise recovering by any manner or means, of any
judgment, award, decree or order against the Debtor or Reorganized Company, any
of its property, or any direct or indirect transferee of any property of, or
direct or indirect successor in interest to, any of the foregoing, or any
property of any such transferee or successor, (c) creating, perfecting or
otherwise enforcing in any manner, directly or indirectly, any encumbrance of
any kind against the Debtor or Reorganized Company, any of its property, or any
direct or indirect transferee of any property of, or successor in interest to,
any of the foregoing, (d) asserting any setoff, right of subrogation or
recoupment of any kind, directly or indirectly, against any obligation due the
Debtor or Reorganized Company, any of the property of the Debtor or the
Reorganized Company, or any direct or indirect transferee of any property of, or
successor in interest to, any of the foregoing, or (e) acting or proceeding in
any manner, in any place whatsoever, that does not conform to or comply with the
provisions of the Plan and the Confirmation Order. Notwithstanding anything
herein to the contrary, nothing in this Article XI, Section D or elsewhere in
this Plan shall in any way affect or impair any rights or causes of action
against any person other than any Covered Person.
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E. INDEMNIFICATION
To facilitate the expeditious and effective reorganization of the Debtor, the
Reorganized Company shall indemnify, hold harmless and reimburse any present
director, officer or employee pursuant to the provisions of its certificate of
incorporation and by-laws and applicable provisions of the laws of New Jersey
from and against any and all losses, claims, damages, liabilities and actions,
asserted or filed against such persons for, by reason of, arising from, in
connection with, involving, or related to services rendered or acts or omissions
to act in those capacities relating to or arising out of the facts and claims
alleged or asserted, or which could have been alleged or asserted prior to the
Confirmation Date. The indemnifications provided hereunder shall survive
confirmation of the Plan and shall not be discharged pursuant to section 1141 of
the Bankruptcy Code. The Reorganized Company shall pay any legal or other
expenses reasonably incurred by such indemnified party in connection with this
indemnification or the enforcement thereof. In no event shall the
indemnification provided hereunder extend to claims or liabilities asserted and
found by a court of competent jurisdiction to arise from willful misconduct,
gross negligence or defalcation by the person seeking indemnification.
XII. CONDITIONS PRECEDENT
A. CONDITIONS TO CONFIRMATION.
The following conditions must be satisfied or waived pursuant to Article XII,
Section C hereof prior to confirmation of the Plan:
(a) Class 2A shall have voted to accept the Plan; and
(b) The Confirmation Order shall be in form and substance
reasonably satisfactory to the Proponents; and
(c) The Plan shall not have been modified or amended in any
material respect, and no material provision of the Plan shall
have been waived.
B. CONDITIONS TO THE OCCURRENCE OF THE EFFECTIVE DATE.
It is a condition precedent to the occurrence of the Effective Date, that the
Confirmation Order shall have become a Final Order.
C. WAIVER OF CONDITIONS.
Without limiting any benefits to the Proponents of the doctrine of mootness, the
Proponents may at any time waive any condition set forth in Article XII, Section
A or B hereof, without any notice to any person, without leave or order of the
Bankruptcy Court, and without any other formal action.
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XIII. POST-CONFIRMATION CLAIMS ADMINISTRATION
A. TIME PERIOD FOR FILING BANKRUPTCY ACTIONS AND OTHER ADVERSARY
PROCEEDINGS
Any Bankruptcy Action or other adversary proceeding to be brought by the
Reorganized Company in the Bankruptcy Court shall be filed within two (2) years
after entry of the Confirmation Order, unless the Bankruptcy Court, for cause,
orders otherwise after notice and a hearing. Nothing in this Section shall be
construed to preclude any proceeding in another court of competent jurisdiction
within otherwise applicable time limits.
B. RIGHT TO RECEIVE DISTRIBUTIONS
Except as provided below with respect to holders of Senior Notes, the Allowed
Claim of each Creditor shall represent their right to receive distributions from
the Reorganized Company, if any.
Pursuant to Article IX, Section C of this Plan, all Senior Notes held by Senior
Noteholders that have not surrendered or been deemed to have surrendered the
instruments representing their claim within one hundred eighty (180) days after
the Effective Date, shall receive no distribution from the Reorganized Company
on account of such Senior Notes, and holders of such Senior Notes shall be
forever barred from asserting any claim on account of such Senior Notes. Any
Cash or New Class A Common Stock allocated or reserved for such holders shall be
returned to the Reorganized Company or cancelled, as applicable.
Pursuant to Article IX, Section C of this Plan, all Equity Securities held by
Claimants that have not surrendered or been deemed to have surrendered the
instruments representing their interests within one hundred eighty (180) days
after the Effective Date, shall receive no distribution from the Reorganized
Company on account of such Equity Security, and holders of such Equity Security
shall be forever barred from asserting any claim on account of such Equity
Security. Any cash allocated or reserved for such holders shall be returned to
the Reorganized Company.
C. OBJECTIONS TO CLAIMS AND EQUITY INTERESTS
The Reorganized Company shall review all claims and Equity Interests filed in
this Case and file any objections to such claims and Equity Interests as it
deems appropriate, including, but not limited to, any fee applications of
Professionals of the Debtor. An objection to the allowance of a claim or Equity
Interest shall be in writing and must be filed with the Bankruptcy Court within
ninety (90) days after entry of the Confirmation Order. Any objection to a claim
or Equity Interest must be served on the Reorganized Company and other parties
in interest as provided under the Bankruptcy Rules and Local Rules. Nothing in
this Article XIII, Section C shall be construed to prohibit any other party in
interest from filing objections to claims or Equity Interests.
D. DISPUTED CLAIMS AND EQUITY INTERESTS
Prior to making any distributions under this Plan, the Reorganized Company shall
establish a reserve account for Disputed Claims and Disputed Equity Interests
("Objection Reserve"). The
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Reorganized Company shall distribute to and maintain in the Objection Reserve
all property which would otherwise be distributable to holders of Disputed
Claims or Disputed Equity Interests, assuming such Disputed Claims or Disputed
Equity Interests would be allowed in the amount claimed. In calculating the
amount of the Objection Reserve, the Reorganized Company shall use one of the
following as the amount of the Disputed Claim or Disputed Equity Interest: (a)
the amount such Claimant alleges is due and owing; (b) the amount ordered by the
Bankruptcy Court for purposes of establishing a reserve; or (c) the amount that
the Reorganized Company and any such Claimant may mutually agree to reserve. The
property reserved for the holder of a Disputed Claim or Disputed Equity Interest
shall be distributed to such holder only to the extent such Disputed Claim or
Equity Interest shall become an Allowed Claim. Any earnings on Cash, or
appreciation of or dividends paid on property held, in the Objection Reserve
shall be allocated to the account of the holder of Disputed Claims or Disputed
Equity Interests for which such Cash or property is held, and distributed to
such holders based on the amount of their respective Allowed Claims or Allowed
Equity Interests.
E. UNCLAIMED DISTRIBUTIONS
If any check paid on account of a distribution is not presented for payment
within sixty (60) days of the date it is mailed to the Claimant, and the check
has not been returned to the Reorganized Company by the United States Postal
Service, the check shall be voided. In such an event, and if the Creditor or
holder of an Equity Interest fails to contact the Reorganized Company within one
hundred eighty (180) days after mailing the check, the dividend will be deemed
to be waived or abandoned and the funds payable to such Creditor or holder of an
Equity Interest shall be returned to the Reorganized Company.
In the event that a check or other property is returned by the United States
Postal Service on account of an incorrect or insufficient address, the
Reorganized Company or its representative will use reasonable means, in view of
the value of the distribution, to determine the correct address and remail the
check. If the correct address cannot be determined or if the second mailing of a
check is returned, then the Creditor or holder of an Equity Interest will be
deemed to have waived or abandoned its claim and the funds or other property
payable to such Creditor or holder of an Equity Interest shall be returned to
the Reorganized Company.
Any cash or other property that remains unclaimed one (1) year after the
Effective Date of this Plan shall be deemed abandoned. Such unclaimed funds
shall be returned to the Reorganized Company free and clear of any claim or
interest of the Claimant.
XIV. EXECUTORY CONTRACTS AND UNEXPIRED LEASES
All executory contracts and unexpired leases of the Debtor that have not been
expressly rejected on or before the Effective Date of this Plan will be deemed
assumed.
The employment contracts of Michael W. Barozzi and William S. Papazian shall be
assumed on the Effective Date without further action required by or on behalf of
the Reorganized Company.
All holders of claims based upon rejection of executory contracts and unexpired
leases are required to file proofs of claims within thirty (30) days following
the Effective Date of this Plan.
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Any claim based upon rejection of an executory contract or unexpired lease that
is not filed prior to such deadline will be deemed to be a Tardily Filed Claim
under the terms of this Plan.
XV. RETENTION OF JURISDICTION
A. SCOPE OF JURISDICTION
The Bankruptcy Court shall retain its jurisdiction over the Case under 28 U.S.C.
Sections 157 and 1334 to:
(a) Determine any and all objections to the allowance of claims;
(b) Determine any and all applications for allowance of fees and
reimbursement of Professionals' expenses under the Bankruptcy
Code relating to services provided and expenses incurred;
(c) Determine any and all motions, adversary proceedings, or
contested matters brought before the Bankruptcy Court;
(d) Determine any and all Actions arising under title 11 of the
United States Code, or arising in or relating to a case under
title 11 of the United States Code, after the Confirmation
Date;
(e) Modify this Plan, or grant declaratory relief with regard to
any defect, omission, or inconsistency in this Plan;
(f) Take any action to enforce this Plan and issue such orders as
may be necessary to implement, execute, and consummate this
Plan;
(g) Determine any dispute regarding implementation of this Plan;
and
(h) Determine such other matters as may arise in connection with
this Plan or consummation of this Plan.
Nothing in this Plan or the Confirmation Order shall expand the jurisdiction of
the Bankruptcy Court beyond that permitted by title 28 of the United States
Code. In addition, nothing in this Plan or the Confirmation Order shall impair
any right to a jury trial that any party in interest in the Case would have
notwithstanding confirmation of this Plan.
B. CONCURRENT WITH OTHER COURTS
Except as otherwise provided in title 28 of the United States Code, the
jurisdiction of the Bankruptcy Court shall be concurrent with other courts of
competent jurisdiction. This Plan shall have no effect upon and shall not
control, prohibit, or limit the exercise of jurisdiction of any other court of
competent jurisdiction with respect to such matters. If the Bankruptcy Court
declines to exercise its jurisdiction on any matter under this Plan, the
reference to the Bankruptcy Court in this Plan shall be deemed to include any
court of competent jurisdiction unless the context requires otherwise.
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XVI. MISCELLANEOUS PROVISIONS
A. TERMINATION OF PROFESSIONALS
Except as otherwise provided in this Plan, all Professionals shall be terminated
as of the Effective Date and such Professionals shall not be entitled to
compensation or reimbursement of expenses for any services rendered after the
Effective Date, except for services rendered and expenses incurred in connection
with any applications for allowance of compensation and reimbursement of
expenses relating to their retention in this case.
B. DISBURSING AGENT
The Indenture Trustee shall serve as disbursing agent with respect to any
distribution made on account of the Senior Notes. The Reorganized Company shall
serve as disbursing agent with respect to any other distributions under this
Plan.
C. WITHHOLDING TAXES
Any federal or state withholding taxes or other amounts required to be withheld
under any applicable law shall be deducted and withheld from any distribution
under the terms of this Plan.
D. AMENDMENTS AND MODIFICATIONS
This Plan may be amended or modified in the manner prescribed in section 1127 of
the Bankruptcy Code. To the extent required under section 1127, a holder of a
claim or Equity Interest that has accepted or rejected this Plan shall be deemed
to have accepted or rejected, as the case may be, this Plan as modified, unless,
within applicable time periods, such holder changes its previous acceptance or
rejection.
E. NOTICES
Any notice of appearance filed pursuant to Bankruptcy Rule 9010 requesting
notice under Bankruptcy Rule 2002 shall be null and void on the Effective Date.
Any Claimant or other party in interest appearing in this Case and requesting
notice under Bankruptcy Rule 2002 on or after the Effective Date must file and
serve a new notice of appearance to receive notice of any matter permitted or
required under this Plan.
F. HEADINGS
The headings used in this Plan are inserted for convenience only and do not
constitute a portion of this Plan, or in any way limit or affect the
enforceability, operation, or effect of any provision of this Plan.
G. EXHIBITS
All exhibits to this Plan are incorporated by reference and made a part of this
Plan.
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H. TIME PERIODS
In computing any period of time prescribed by this Plan, the provisions of
Bankruptcy Rule 9006(a) shall apply unless the context requires otherwise.
I. GOVERNING LAW
Except to the extent that the provisions of the Bankruptcy Code, Bankruptcy
Rules, federal statutes or common law require otherwise, and subject to the
provisions of any contract, instrument, or other agreement entered into in
conjunction with this Plan, the rights and obligations arising under this Plan
shall be governed by and enforced in accordance with the laws of the State of
New Jersey.
J. SEVERABILITY
Should any provision of this Plan be determined to be unenforceable, such
determination shall not in any way limit or affect the enforceability,
operation, or effect of any other provision of this Plan.
K. SUCCESSORS AND ASSIGNS
The rights and obligations of any party in interest to this Plan shall be
binding on, and shall inure to the benefit of, the successors and assigns of
such party in interest.
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Dated: August 4, 2000
Respectfully submitted,
CAPITAL GAMING INTERNATIONAL, INC.
By /s/ William S. Papazian
------------------------------------
William S. Papazian
U.S. BANK TRUST NATIONAL ASSOCIATION,
As Indenture Trustee
By /s/ Scott Strodthoff
------------------------------------
Scott Strodthoff
Senior Vice President
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XVII. EXHIBITS
A. Amended Bylaws
B. Amended Certificate of Incorporation
26
