UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_______________________
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
_______________________
Date of Report
(Date of earliest
event reported): July 7, 1998
United States Leather, Inc.
(Exact name of registrant as specified in its charter)
Wisconsin 0-24645 13-3503310
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification No.)
incorporation)
1403 West Bruce Street, Milwaukee, Wisconsin 53204
(Address of principal executive offices, including zip code)
(414) 383-6030
(Registrant's telephone number)
<PAGE>
Item 3. Bankruptcy or Receivership.
On July 7, 1998, the United States Bankruptcy Court for the Eastern
District of Wisconsin, entered an order confirming the Plan of
Reorganization under Chapter 11 of the United States Bankruptcy Code
proposed by United States Leather, Inc. (the "Company"), as modified (the
"Plan"). The Plan became effective on July 20, 1998 (the "Effective
Date"). The Plan and the Company's disclosure statement that relates to
the Plan (the "Disclosure Statement") are filed as exhibits hereto, and
the material features of the Plan are set forth in the Disclosure
Statement under the caption "VI. Summary of the Plan," which is
incorporated herein by reference.
As of the Effective Date, the Company did not have any shares of
its common stock, par value $.01 per share (the "Common Stock"), issued
and outstanding, and had approximately 10 million shares of Common Stock
reserved for future issuance in respect of claims and interests filed and
allowed under the Plan.
For information as to the assets and liabilities of the Company and
its subsidiaries, reference is made to the Company's unaudited
consolidated condensed balance sheets as of March 31, 1998 contained in
the Company's Report on Form 10-Q for the quarterly period ended March 31,
1998 filed as Exhibit 13.1 hereto, which balance sheet is incorporated
herein by reference.
Item 7. Financial Statements and Exhibits.
(c) Exhibits.
The exhibits listed in the accompanying Exhibit Index are filed as
part of this Current Report on Form 8-K.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
UNITED STATES LEATHER, INC.
Date: July 21, 1998 By: /s/ Kinzie L. Weimer
Kinzie L. Weimer
Senior Vice President, Chief Financial
Officer, Treasurer and Secretary
<PAGE>
UNITED STATES LEATHER, INC.
EXHIBIT INDEX TO FORM 8-K
Dated July 7, 1998
Exhibit
No. Description
(2.1) Amended Plan of Reorganization Under Chapter 11 of the
Bankruptcy Code.
(3.1) Restated Articles of Incorporation of the Company
(Incorporated by reference to Exhibit (1) to the Company's
Registration Statement on Form 8-A dated July 20, 1998).
(3.2) Bylaws of the Company (Incorporated by referenced to the
Company's Registration Statement on Form 8-A dated July 20,
1998).
(13.1) United States Leather, Inc. and Subsidiaries Consolidated
Condensed Balance Sheets (Unaudited) as of March 31, 1998
(Incorporated by reference to the Company's Form 10-Q for the
quarterly period ended March 31, 1998).
(99.1) Disclosure Statement Pursuant to Section 1125 of the
Bankruptcy Code with respect to Plan of Reorganization, dated
March 31, 1998 (Incorporated by reference to Exhibit 99.1 to
the Company's Current Report on Form 8-K dated April 1, 1998).
UNITED STATES BANKRUPTCY COURT
EASTERN DISTRICT OF WISCONSIN
In re:
United States Leather, Inc.,
a Wisconsin corporation, Case No. 98-24997
Honorable M.D. McGarity
Chapter 11
Debtor.
Employer ID No. 13-3503310
AMENDED PLAN OF REORGANIZATION OF UNITED STATES LEATHER, INC.
Thomas L. Shriner, Jr.
Andrew J. Wronski
Foley & Lardner
777 E. Wisconsin Avenue
Milwaukee, WI 53202-5367
Telephone: (414) 271-2400
Fax: (414) 297-4900
<PAGE>
TABLE OF CONTENTS
Page
INTRODUCTION . . . . . . . . . . . . . . . . . . . . . . . . . 1
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.01 Administrative Expense Claim . . . . . . . . . . . . 1
1.02 Allowed . . . . . . . . . . . . . . . . . . . . . . . 2
1.03 Allowed Class . . . Claim . . . . . . . . . . . . . . 2
1.04 Ballot . . . . . . . . . . . . . . . . . . . . . . . 2
1.05 Bankruptcy Code . . . . . . . . . . . . . . . . . . . 2
1.06 Bankruptcy Court . . . . . . . . . . . . . . . . . . 2
1.07 Bankruptcy Rules . . . . . . . . . . . . . . . . . . 2
1.08 Banks . . . . . . . . . . . . . . . . . . . . . . . . 2
1.09 Bar Date . . . . . . . . . . . . . . . . . . . . . . 3
1.10 Business Day . . . . . . . . . . . . . . . . . . . . 3
1.11 Cash . . . . . . . . . . . . . . . . . . . . . . . . 3
1.12 Chapter 11 Case . . . . . . . . . . . . . . . . . . . 3
1.13 Claim . . . . . . . . . . . . . . . . . . . . . . . . 3
1.14 Class . . . . . . . . . . . . . . . . . . . . . . . . 3
1.15 Commission . . . . . . . . . . . . . . . . . . . . . 3
1.16 Confirmation . . . . . . . . . . . . . . . . . . . . 3
1.17 Confirmation Date . . . . . . . . . . . . . . . . . . 3
1.18 Confirmation Hearing . . . . . . . . . . . . . . . . 3
1.19 Confirmation Order . . . . . . . . . . . . . . . . . 3
1.20 Consummation . . . . . . . . . . . . . . . . . . . . 3
1.21 Creditors' Committee . . . . . . . . . . . . . . . . 4
1.22 Cure . . . . . . . . . . . . . . . . . . . . . . . . 4
1.23 Debtor . . . . . . . . . . . . . . . . . . . . . . . 4
1.24 DIP Credit Facility . . . . . . . . . . . . . . . . . 4
1.25 Disallowed Claim . . . . . . . . . . . . . . . . . . 4
1.26 Disclosure Statement . . . . . . . . . . . . . . . . 4
1.27 Disputed Claim . . . . . . . . . . . . . . . . . . . 4
1.28 Effective Date . . . . . . . . . . . . . . . . . . . 4
1.29 Emergence Credit Facility . . . . . . . . . . . . . . 5
1.30 Estate . . . . . . . . . . . . . . . . . . . . . . . 5
1.31 Final Order . . . . . . . . . . . . . . . . . . . . . 5
1.32 Indenture . . . . . . . . . . . . . . . . . . . . . . 5
1.33 Informal Noteholders' Committee . . . . . . . . . . . 5
1.34 Informal Noteholders' Committee Expenses . . . . . . 5
1.35 Interest . . . . . . . . . . . . . . . . . . . . . . 5
1.36 New Common Stock . . . . . . . . . . . . . . . . . . 5
1.37 Note Claims . . . . . . . . . . . . . . . . . . . . . 5
1.38 Noteholders . . . . . . . . . . . . . . . . . . . . . 5
1.39 Notes . . . . . . . . . . . . . . . . . . . . . . . . 5
1.40 Other Priority Claim . . . . . . . . . . . . . . . . 6
1.41 Person . . . . . . . . . . . . . . . . . . . . . . . 6
1.42 Petition Date . . . . . . . . . . . . . . . . . . . . 6
1.43 Plan . . . . . . . . . . . . . . . . . . . . . . . . 6
1.44 Post-Restructuring Board . . . . . . . . . . . . . . 6
1.45 Prepetition Credit Agreement . . . . . . . . . . . . 6
1.46 Prepetition Credit Agreement Claims . . . . . . . . . 6
1.47 Prepetition Credit Facility . . . . . . . . . . . . . 6
1.48 Prepetition Lenders . . . . . . . . . . . . . . . . . 6
1.49 Priority Tax Claim . . . . . . . . . . . . . . . . . 6
1.50 Professional Fees . . . . . . . . . . . . . . . . . . 7
1.51 Record Date . . . . . . . . . . . . . . . . . . . . . 7
1.52 Registration Rights Agreement . . . . . . . . . . . . 7
1.53 Reinstated or Reinstatement . . . . . . . . . . . . . 7
1.54 Reorganized USL . . . . . . . . . . . . . . . . . . . 7
1.55 Requisite Acceptances . . . . . . . . . . . . . . . . 7
1.56 Restated Articles of Incorporation . . . . . . . . . 7
1.57 Restated By-Laws . . . . . . . . . . . . . . . . . . 7
1.58 Restructuring . . . . . . . . . . . . . . . . . . . . 8
1.59 Schedules . . . . . . . . . . . . . . . . . . . . . . 8
1.60 Secured Claim . . . . . . . . . . . . . . . . . . . . 8
1.61 Securities Act . . . . . . . . . . . . . . . . . . . 8
1.62 Solicitation . . . . . . . . . . . . . . . . . . . . 8
1.63 Stockholders . . . . . . . . . . . . . . . . . . . . 8
1.64 USL . . . . . . . . . . . . . . . . . . . . . . . . . 8
1.65 USL Common Stock . . . . . . . . . . . . . . . . . . 8
1.66 Voting Deadline . . . . . . . . . . . . . . . . . . . 8
ARTICLE II ADMINISTRATIVE EXPENSE CLAIMS . . . . . . . . . . . 9
2.01 Administrative Expense Claims. . . . . . . . . . . . 9
ARTICLE III CLASSIFICATION OF CLAIMS AND INTERESTS . . . . . . 9
3.01 Class 1: Priority Tax Claims. . . . . . . . . . . . 9
3.02 Class 2: Other Priority Claims. . . . . . . . . . . 9
3.03 Class 3: Miscellaneous Secured Claims. . . . . . . 10
3.04 Class 4: Prepetition Credit Agreement Claims. . . 10
3.05 Class 5: Note Claims. . . . . . . . . . . . . . . . 10
3.06 Class 6: General Unsecured Claims Against USL. . . 10
3.07 Class 7: Interests in Respect of USL Common Stock. 10
ARTICLE IV TREATMENT OF UNIMPAIRED CLASSES (CLASSES 1, 2, 3,
4, AND 6) . . . . . . . . . . . . . . . . . . . . . . . 10
4.01 Class 1 (Priority Tax Claims). . . . . . . . . . . 10
4.02 Class 2 (Other Priority Claims). . . . . . . . . . 10
4.03 Class 3 (Miscellaneous Secured Claims). . . . . . . 11
4.04 Class 4 (Prepetition Credit Agreement Claims). . . 11
4.05 Class 6 (General Unsecured Claims Against USL). . . 11
4.06 Unimpaired Classes. . . . . . . . . . . . . . . . . 11
ARTICLE V TREATMENT OF IMPAIRED CLASSES (CLASSES 5 AND 7) . . 12
5.01 Class 5 (Note Claims). . . . . . . . . . . . . . . 12
5.02 Class 7 (Interests in Respect of USL Common Stock). 12
5.03 Impaired Classes and Interests. . . . . . . . . . . 12
ARTICLE VI DISPUTED CLAIMS . . . . . . . . . . . . . . . . . 12
6.01 Disputed Claims; Objections to Claims. . . . . . . 12
6.02 Resolution of Claims. . . . . . . . . . . . . . . . 12
ARTICLE VII MEANS FOR IMPLEMENTATION OF THE PLAN . . . . . . 13
7.01 Management of Reorganized USL. . . . . . . . . . . 13
7.02 Restated Articles of Incorporation and
Restated By-Laws. . . . . . . . . . . . . . . . . 13
7.03 Emergence Credit Facility. . . . . . . . . . . . . 13
7.04 Operations of Debtor Between Confirmation and
Consummation. . . . . . . . . . . . . . . . . . . 13
7.05 Exclusivity. . . . . . . . . . . . . . . . . . . . 14
7.06 Term of Injunctions or Stays. . . . . . . . . . . . 14
7.07 Cancellation of Existing Securities, Instruments,
and Agreements. . . . . . . . . . . . . . . . . . 14
7.08 Distribution of Consideration. . . . . . . . . . . 14
7.09 Registration Rights Agreement. . . . . . . . . . . 16
7.10 Corporate Action. . . . . . . . . . . . . . . . . . 16
7.11 Effectuating Documents; Further Transactions. . . . 16
7.12 Authorization for Management Stock Incentive Program 16
7.13 Retiree Benefits. . . . . . . . . . . . . . . . . . 16
7.14 Ordinary Course and Scheduled Liabilities. . . . . 17
7.15 Effect of Failure to File Proof of Claim by Bar Date 17
ARTICLE VIII ACCEPTANCE OR REJECTION OF THE PLAN; EFFECT OF
REJECTION BY IMPAIRED CLASSES OF CLAIMS . . . . . . . . 18
8.01 Classes Entitled to Vote. . . . . . . . . . . . . . 18
8.02 Class Acceptance Requirement. . . . . . . . . . . . 18
8.03 Cram Down. . . . . . . . . . . . . . . . . . . . . 18
ARTICLE IX PRESERVATION OF LITIGATION CLAIMS AND RIGHTS
OF ACTION . . . . . . . . . . . . . . . . . . . . . . . 18
9.01 Retained Litigation Claims and Rights of Action. . 18
9.02 Preservation of Insurance. . . . . . . . . . . . . 18
ARTICLE X EXECUTORY CONTRACTS AND UNEXPIRED LEASES . . . . . 19
10.01 Assumption. . . . . . . . . . . . . . . . . . . . 19
10.02 Payments Related to Assumption. . . . . . . . . . 19
10.03 Officers' and Directors' Indemnification Rights. 19
10.04 Compensation and Benefit Programs. . . . . . . . 20
ARTICLE XI CONDITIONS PRECEDENT . . . . . . . . . . . . . . . 20
11.01 Conditions to Confirmation. . . . . . . . . . . . 20
11.02 Conditions to Consummation. . . . . . . . . . . . 20
11.03 Waiver of Conditions. . . . . . . . . . . . . . . 22
11.04 Effect of Failure of Conditions. . . . . . . . . 22
11.05 Notice to Bankruptcy Court. . . . . . . . . . . . 22
ARTICLE XII MODIFICATION, REVOCATION, OR WITHDRAWAL
OF THE PLAN . . . . . . . . . . . . . . . . . . . . . . 22
12.01 Modification of Plan. . . . . . . . . . . . . . . 22
12.02 Revocation or Withdrawal of Plan. . . . . . . . . 23
12.03 Nonconsensual Confirmation. . . . . . . . . . . . 23
ARTICLE XIII EFFECT OF CONFIRMATION . . . . . . . . . . . . . 24
13.01 Binding Effect. . . . . . . . . . . . . . . . . . 24
13.02 Discharge of Debtor. . . . . . . . . . . . . . . 24
13.03 Injunction. . . . . . . . . . . . . . . . . . . . 24
13.04 Revesting. . . . . . . . . . . . . . . . . . . . 24
13.05 Operation of Business. . . . . . . . . . . . . . 25
13.06 Releases. . . . . . . . . . . . . . . . . . . . . 25
13.07 Exculpation. . . . . . . . . . . . . . . . . . . 26
13.08 Termination of Committees. . . . . . . . . . . . 26
ARTICLE XIV RETENTION OF JURISDICTION . . . . . . . . . . . . 26
14.01 Jurisdiction of Bankruptcy Court. . . . . . . . . 26
14.02 Failure of Bankruptcy Court to
Exercise Jurisdiction. . . . . . . . . . . . . . 28
ARTICLE XV MISCELLANEOUS PROVISIONS . . . . . . . . . . . . . 28
15.01 Time. . . . . . . . . . . . . . . . . . . . . . . 28
15.02 Headings. . . . . . . . . . . . . . . . . . . . . 28
15.03 Saturday, Sunday, or Legal Holiday. . . . . . . . 28
15.04 Payment of Statutory Fees. . . . . . . . . . . . 28
15.05 Severability. . . . . . . . . . . . . . . . . . . 28
15.06 Modification of Treatment of Claims
or Interests. . . . . . . . . . . . . . . . . . 29
15.07 Section 1145 Exemption. . . . . . . . . . . . . . 29
15.08 Section 1146 Exemption. . . . . . . . . . . . . . 29
15.09 Governing Law. . . . . . . . . . . . . . . . . . 29
15.10 Withholding and Reporting Requirements. . . . . . 29
15.11 Notice. . . . . . . . . . . . . . . . . . . . . . 30
<PAGE>
INTRODUCTION
United States Leather, Inc. ("USL" or the "Debtor"), as debtor
and debtor-in-possession, proposes this plan of reorganization (the
"Plan"), as it may be amended, pursuant to section 1121(a) of title 11 of
the United States Code, for the resolution of its outstanding creditor
claims and equity interests.
All impaired creditors and equity security holders are
strongly encouraged to consult the Disclosure Statement relating to this
Plan, which discusses the Debtor and its management, business, assets, and
liabilities, before voting to accept or to reject this Plan.
Subject to the restrictions on modification set forth in
section 1127 of the Bankruptcy Code and those restrictions on modification
set forth in Article XII of this Plan, the Debtor reserves the right to
alter, amend, or modify this Plan one or more times before its substantial
Consummation.
ARTICLE I
DEFINITIONS
Rules of Interpretation. As used herein, the following terms
have the respective meanings specified below, and such meanings shall be
equally applicable to both the singular and plural, and masculine and
feminine, forms of the terms defined. The words "herein," "hereof,"
"hereto," "hereunder," and others of similar import refer to this Plan as
a whole and not to any particular section, subsection, or clause contained
in this Plan. Captions and headings to articles, sections, and exhibits
are inserted for convenience of reference only, and they are not intended
to be part of or to affect the interpretation of this Plan. The rules of
construction set forth in section 102 of the Bankruptcy Code shall apply.
Any capitalized term used herein that is not defined herein but that is
defined in the Bankruptcy Code shall have the meaning ascribed to that
term in the Bankruptcy Code. In addition to such other terms as are
defined in other sections of this Plan, the following terms (which appear
in this Plan and in the Disclosure Statement as capitalized terms) have
the following meanings as used in this Plan.
1.01 Administrative Expense Claim means a Claim for payment
of an administrative expense of a kind specified in section 503(b) of the
Bankruptcy Code and entitled to priority pursuant to section 507(a)(1) of
the Bankruptcy Code, including, without limitation, any Claims of the
Prepetition Lenders or the Banks arising under the DIP Credit Facility,
the actual, necessary costs and expenses incurred after the Petition Date
of preserving the Estate and operating the business of USL, including
wages, salaries, or commissions for services rendered after the
commencement of the Chapter 11 Case, Professional Fees, and all fees and
charges assessed against the Estate under section 1930 of title 28 of the
United States Code.
1.02 Allowed means (i) with respect to a Claim (other than
an Administrative Expense Claim), any such Claim, proof of which was
timely and properly filed or, if no proof of claim was filed, that has
been or hereafter is listed by the Debtor on its Schedules as liquidated
in amount and not disputed or contingent, and, in either case, a Claim as
to which no objection to the allowance thereof, or motion to estimate for
purposes of allowance, shall have been filed on or before any applicable
period of limitation that may be fixed by the Bankruptcy Code, the
Bankruptcy Rules, or the Bankruptcy Court, or as to which any objection,
or any motion to estimate for purposes of allowance, shall have been so
filed, to the extent allowed by a Final Order; and (ii) with respect to an
Administrative Expense Claim, any such Administrative Expense Claim as to
which no objection to the allowance thereof has been interposed on or
before any applicable period of limitation that may be fixed by the
Bankruptcy Code, the Bankruptcy Rules, or the Bankruptcy Court, or as to
which any objection has been so interposed, to the extent allowed by a
Final Order. Except as otherwise provided herein, no amounts accruing
from and after the Petition Date, including, without limitation,
principal, interest, fees, and expenses, shall be Allowed with respect to
any Claim.
1.03 Allowed Class . . . Claim means an Allowed Claim in
the particular Class described.
1.04 Ballot means (i) the form of master ballot provided
for use by brokers, banks, proxy intermediaries, or other nominees that
hold Notes as of record on behalf of one or more beneficial owners, (ii)
the form of ballot provided to beneficial owners of the Notes in order to
permit such holders to vote on the Plan, and (iii) the form of ballot
provided to beneficial owners of USL Common Stock in order to permit such
holders to vote on the Plan.
1.05 Bankruptcy Code means the Bankruptcy Reform Act of
1978, as amended from time to time, as applicable to the Chapter 11 Case,
set forth in sections 101 et seq. of title 11 of the United States Code.
1.06 Bankruptcy Court means the United States Bankruptcy
Court for the Eastern District of Wisconsin, or such other court that
exercises jurisdiction over the Chapter 11 Case or any proceeding therein,
including the United States District Court for the Eastern District of
Wisconsin, to the extent reference of the Chapter 11 Case or any
proceeding therein is withdrawn.
1.07 Bankruptcy Rules means the Federal Rules of Bankruptcy
Procedure, as amended from time to time, as applicable to the Chapter 11
Case, including the local rules and standing orders of the Bankruptcy
Court.
1.08 Banks means any banks or other lenders, other than the
Prepetition Lenders, that may extend, or become parties to agreements,
instruments, or other documents extending, the DIP Credit Facility or the
Emergence Credit Facility.
1.09 Bar Date has the meaning given in section 7.15 hereof.
1.10 Business Day means a day other than a Saturday,
Sunday, or other day on which banks in New York, New York are authorized
or required by law to be closed.
1.11 Cash means legal tender of the United States or its
equivalent.
1.12 Chapter 11 Case means the case under chapter 11 of the
Bankruptcy Code with respect to the Debtor, pending in the Bankruptcy
Court, administered as In re United States Leather, Inc., Case No. 98-
24997-MDM (Chapter 11).
1.13 Claim means a claim against USL, whether or not
asserted, as defined in section 101(5) of the Bankruptcy Code, including,
without limitation, (a) any right to payment from the Debtor arising
before the Confirmation Date, whether or not such right is reduced to
judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured,
disputed, undisputed, legal, equitable, secured, or unsecured or (b) any
right to an equitable remedy against the Debtor for breach of performance
if such breach gives rise to a right of payment from the Debtor, whether
or not such right to an equitable remedy is reduced to judgment, fixed,
contingent, matured, unmatured, disputed, undisputed, secured, or
unsecured.
1.14 Class means a category of holders of Claims or
Interests described in Article III hereof.
1.15 Commission means the Securities and Exchange
Commission.
1.16 Confirmation means confirmation of the Plan pursuant
to section 1129 of the Bankruptcy Code.
1.17 Confirmation Date means the date on which the
Confirmation Order is entered on the docket of the Bankruptcy Court.
1.18 Confirmation Hearing means the hearing on confirmation
of the Plan under section 1128 of the Bankruptcy Code.
1.19 Confirmation Order means the order of the Bankruptcy
Court confirming the Plan in accordance with the provisions of chapter 11
of the Bankruptcy Code.
1.20 Consummation means the satisfaction of all conditions
to the consummation of the Plan set forth in sections 11.01 and 11.02
hereof or the waiver of such conditions as provided in section 11.03
hereof.
1.21 Creditors' Committee means an official committee of
unsecured creditors appointed in the Chapter 11 Case by the United States
Trustee, if any, pursuant to section 1102 of the Bankruptcy Code, as
modified by the addition or removal of members from time to time.
1.22 Cure means the distribution of Cash, or such other
property as may be agreed upon by the parties and ordered by the
Bankruptcy Court, with respect to the assumption of an executory contract
or unexpired lease, pursuant to section 365(b) of the Bankruptcy Code, in
an amount equal to all unpaid monetary obligations, without interest, or
such other amount as may be agreed upon by the parties, under such
executory contract or unexpired lease, to the extent such obligations are
enforceable under the Bankruptcy Code and applicable non-bankruptcy law.
1.23 Debtor means USL, on and after the Petition Date, as
debtor and debtor-in-possession.
1.24 DIP Credit Facility means the revolving credit
facility to be provided to the Debtor pursuant to section 364 of the
Bankruptcy Code by either (i) the Banks, on such terms and conditions as
to which the Banks and the Debtor may agree or (ii) the Prepetition
Lenders, substantially in accordance with the terms set forth in Exhibit
A-1 to the Prepetition Credit Agreement, or such other terms to which the
Debtor and the Prepetition Lenders may agree, together with the
agreements, instruments, documents, and orders of the Bankruptcy Court
authorizing and governing such facility.
1.25 Disallowed Claim means (a) a Claim, or any portion
thereof, that has been disallowed by a Final Order or (b) a Claim as to
which a Bar Date has been established by the Bankruptcy Code, Bankruptcy
Rules, or a Final Order of the Bankruptcy Court, but no proof of Claim has
been filed or deemed timely filed with the Bankruptcy Court pursuant to
either the Bankruptcy Code, Bankruptcy Rules, or any Final Order of the
Bankruptcy Court.
1.26 Disclosure Statement means the Disclosure Statement of
United States Leather, Inc., dated March 31, 1998, as amended,
supplemented, or modified from time to time, pertaining to the Plan.
1.27 Disputed Claim means any Administrative Expense Claim,
Claim, or portion thereof, as to which the Debtor or any other party in
interest has interposed a timely objection or request for estimation in
accordance with the Bankruptcy Code and the Bankruptcy Rules, which
objection or request has not been withdrawn or determined by a Final Order
or otherwise settled as provided in section 6.02 hereof. As of any date
of determination, any Claim that is an Allowed Claim or a Disallowed
Claim, or that has been withdrawn, will not be considered a Disputed
Claim.
1.28 Effective Date means the first Business Day on which
all of the conditions set forth in sections 11.01 and 11.02 hereof have
been satisfied or waived as provided in section 11.03 hereof.
1.29 Emergence Credit Facility means the revolving credit
facility to be provided to Reorganized USL pursuant to an agreement, to be
dated as of the Effective Date, (i) among Reorganized USL and the Banks on
such terms and conditions as to which the Banks and Reorganized USL may
agree or, as the case may be, (ii) among Reorganized USL and the
Prepetition Lenders substantially in accordance with the terms set forth
in Exhibit A-2 to the Prepetition Credit Agreement, or such other terms as
to which Reorganized USL and the Prepetition Lenders may agree, together
with the agreements, instruments, and other documents governing such
facility.
1.30 Estate means the estate of USL in the Chapter 11 Case,
created pursuant to section 541 of the Bankruptcy Code.
1.31 Final Order means an order or judgment entered by the
Bankruptcy Court or any other court exercising jurisdiction over the
subject matter and the parties (a) that has not been reversed, stayed,
modified, or amended, (b) as to which no appeal, certiorari proceeding,
reargument, or other review or rehearing has been requested or is still
pending, and (c) as to which the time for filing a notice of appeal,
petition for certiorari, or request for reargument or further review or
rehearing shall have expired.
1.32 Indenture means the Indenture, dated as of August 2,
1993, and entered into by and between USL and M&I First National Bank, as
trustee, relating to the Notes.
1.33 Informal Noteholders' Committee means the informal and
unofficial committee of Noteholders formed prior to the commencement of
the Chapter 11 Case.
1.34 Informal Noteholders' Committee Expenses means the
fees and expenses outstanding on the Effective Date incurred by the
Informal Noteholders' Committee on behalf of holders of the Allowed Note
Claims (including, without limitation, the fees and expenses of counsel)
in connection with the negotiation and documentation of the Plan, the
Plan-related documents, and the Chapter 11 Case.
1.35 Interest means any equity interest in the Debtor
represented by USL Common Stock.
1.36 New Common Stock means the common stock of Reorganized
USL, $.01 par value per share, authorized for issuance under the Plan.
1.37 Note Claims means all Claims directly or indirectly
arising from or under, or relating in any way to, the Notes, including
Claims for accrued but unpaid interest, and the Informal Noteholders'
Committee Expenses.
1.38 Noteholders means holders of the Notes as of the
Record Date.
1.39 Notes means United States Leather, Inc.'s 10.25%
Senior Notes, due 2003.
1.40 Other Priority Claim means a Claim for an amount
entitled to priority in right of payment under section 507(a)(3), (4),
(5), or (6) of the Bankruptcy Code.
1.41 Person means an individual, a corporation, a
partnership, an association, a joint stock company, a joint venture, an
estate, a trust, an unincorporated organization, a government, or any
political subdivision thereof, or any other entity.
1.42 Petition Date means May 11, 1998, the date on which
USL filed its petition for relief commencing the Chapter 11 Case.
1.43 Plan means this plan of reorganization, as it may be
amended, modified, or otherwise supplemented from time to time.
1.44 Post-Restructuring Board means the Board of Directors
of Reorganized USL as of the Effective Date, as provided in section 7.01
hereof.
1.45 Prepetition Credit Agreement means the Loan and
Security Agreement, dated as of January 14, 1998, among USL and the
Prepetition Lenders, together with all agreements, instruments, and other
documents related thereto or entered into in connection therewith, each as
amended, modified, or supplemented from time to time, including, without
limitation, under Amendment No. 1 To Loan and Security Agreement.
1.46 Prepetition Credit Agreement Claims means all Claims
of the Prepetition Lenders arising under or related to the Prepetition
Credit Agreement, which, for purposes of the Plan, shall be deemed to be
an Allowed Claim and a Secured Claim in an amount equal to the excess of
(a) all "Obligations" (as such term is defined in the Prepetition Credit
Agreement) under the Prepetition Credit Agreement over (b) the sum of all
payments made in Cash by the Debtor to the Prepetition Lenders prior to
the Effective Date on account of such Prepetition Credit Agreement Claims
pursuant to any order of the Bankruptcy Court authorizing and approving
the DIP Credit Facility.
1.47 Prepetition Credit Facility means the credit facility
extended by the Prepetition Lenders to USL pursuant to the Prepetition
Credit Agreement.
1.48 Prepetition Lenders means BankAmerica Business Credit,
Inc., as agent and lender, PNC Bank National Association and LaSalle
Business Credit, Inc., as lenders, pursuant to the Prepetition Credit
Agreement, the DIP Credit Facility, and/or the Emergence Credit Facility,
as the case may be, and their respective successors and assigns, and any
other lenders that may become parties to any of the foregoing credit
facilities.
1.49 Priority Tax Claim means a Claim, other than an
Administrative Claim, of a governmental unit of the kind entitled to
priority under section 507(a)(8) of the Bankruptcy Code.
1.50 Professional Fees means a Claim of a professional,
retained in the Chapter 11 Case, pursuant to sections 327 and 1103 of the
Bankruptcy Code, or otherwise, for compensation or reimbursement of costs
and expenses relating to services incurred prior to and including
Confirmation, when and to the extent any Claim described above is approved
by a Final Order entered pursuant to section 330, 331, or 503(b) of the
Bankruptcy Code.
1.51 Record Date means, with respect to the Notes, March
27, 1998 and, with respect to USL Common Stock, April 30, 1998.
1.52 Registration Rights Agreement means the agreement, to
be entered into on or before the Effective Date and in form reasonably
acceptable to the Debtor and the Informal Noteholders' Committee, pursuant
to which Reorganized USL shall grant certain "shelf" and/or "demand"
rights with respect to registration of the New Common Stock under the
Securities Act to the holders of New Common Stock.
1.53 Reinstated or Reinstatement means leaving unaltered
the legal, equitable, and contractual rights to which a Claim entitles the
holder of such Claim so as to leave such Claim unimpaired, in accordance
with section 1124 of the Bankruptcy Code, thereby entitling the holder of
such Claim to, but not more than, (a) reinstatement of the original
maturity of the obligations on which such Claim is based and (b) payment,
as provided herein, of an amount of Cash consisting solely of the sum of
(i) matured but unpaid principal installments, without regard to any
acceleration of maturity, accruing prior to the Effective Date, (ii)
accrued but unpaid interest as of the Effective Date, and (iii) reasonable
fees, expenses, and charges, to the extent such fees, expenses, and
charges are allowed under the Bankruptcy Code and are provided for in the
agreement or agreements on which such Claim is based.
1.54 Reorganized USL means USL from and after the Effective
Date.
1.55 Requisite Acceptances means, with respect to each
Class of Claims entitled to vote on the Plan, acceptance of the Plan, in
the form of a vote on a Ballot in favor of the Plan, by at least two-
thirds (2/3) in aggregate dollar amount and more than one-half (1/2) in
number of the Allowed Claims of such Class held by those holders of Claims
in such Class that have timely voted on the Plan and, with respect to each
Class of Interests entitled to vote on the Plan, acceptance of the Plan,
in the form of a vote on a Ballot in favor of the Plan, by at least two-
thirds (2/3) in aggregate amount of the Interests of such Class held by
those holders of Interests in such Class that have timely voted on the
Plan.
1.56 Restated Articles of Incorporation means the Restated
Articles of Incorporation of United States Leather, Inc., substantially in
the form of Appendix E to the Disclosure Statement.
1.57 Restated By-Laws means the By-Laws of United States
Leather, Inc., substantially in the form of Appendix F to the Disclosure
Statement.
1.58 Restructuring means USL's proposal, including, but not
limited to, the terms described in the Plan and the Disclosure Statement,
for the resolution of USL's outstanding Claims and Interests.
1.59 Schedules means, collectively, the schedules of assets
and liabilities and the statement of financial affairs filed by the Debtor
with the Bankruptcy Court on the Petition Date, pursuant to section 521 of
the Bankruptcy Code and Rule 1007 of the Bankruptcy Rules, as the same
have been or may hereafter be amended or supplemented from time to time.
1.60 Secured Claim means any Claim against the Debtor held
by any entity, including a subsidiary, affiliate, or judgment creditor of
the Debtor, to the extent such Claim constitutes a secured Claim under
sections 506(a) or 1111(b) of the Bankruptcy Code, other than a Claim that
is an Administrative Expense Claim, a Class 1 Claim, or a Class 2 Claim.
1.61 Securities Act means the Securities Act of 1933, as
amended from time to time.
1.62 Solicitation means USL's prepetition solicitation,
including, but not limited to, dissemination of the Disclosure Statement,
of acceptances of the Plan from Noteholders and Stockholders.
1.63 Stockholders means holders of Interests in USL Common
Stock, as of the Record Date.
1.64 USL means United States Leather, Inc., a Wisconsin
corporation.
1.65 USL Common Stock means the common stock of USL, $.01
par value per share.
1.66 Voting Deadline means May 6, 1998, or such further
date, on which USL's prepetition solicitation of Ballots expired.
ARTICLE II
ADMINISTRATIVE EXPENSE CLAIMS
2.01 Administrative Expense Claims. Each holder of an
Allowed Administrative Expense Claim shall be paid in full in Cash as soon
as practicable after (but in any event within thirty days of) the later of
(a) the Effective Date and (b) the date such Administrative Expense Claim
becomes Allowed, unless such holder shall agree to a different treatment
(including any different treatment that may be provided for in the
documentation governing such Claim); provided, however, that Allowed
Administrative Expense Claims with respect to liabilities and obligations
incurred by the Debtor in the ordinary course of business during the
Chapter 11 Case (including, without limitation, such Claims of vendors and
suppliers in respect of goods sold and services furnished to the Debtor in
the ordinary course of the Debtor's business) may be assumed by
Reorganized USL and be paid by Reorganized USL in the ordinary course of
business in accordance with the terms and conditions of the particular
transaction and any agreements and instruments relating thereto; provided
further, however, that any Claims of the Prepetition Lenders or, as the
case may be, the Banks arising under the DIP Credit Facility shall be paid
in full in Cash on the Effective Date.
ARTICLE III
CLASSIFICATION OF CLAIMS AND INTERESTS
All Claims and Interests, except Administrative Expense Claims,
are placed in the Classes set forth below. In accordance with section
1123(a)(1) of the Bankruptcy Code, Administrative Expense Claims, as
described above, have not been classified.
For purposes of the Plan, Claims and Interests are classified
as provided below. A Claim is classified in a particular Class only to
the extent that such Claim qualifies within the description of that Class
and is classified in a different Class to the extent that the Claim
qualifies within the description of that different Class.
A Claim or Interest is also placed in a particular Class for
the purpose of receiving distributions pursuant to the Plan only to the
extent that such Claim or Interest is an Allowed Claim in that Class and
such Claim or Interest has not been paid, released, or otherwise settled
prior to the Effective Date.
3.01 Class 1: Priority Tax Claims. Class 1 consists of
all Priority Tax Claims. As described in Article IV hereof, Class 1 is
not impaired and is not entitled to vote on the Plan.
3.02 Class 2: Other Priority Claims. Class 2 consists of
all Other Priority Claims. As described in Article IV hereof, Class 2 is
not impaired and is not entitled to vote on the Plan.
3.03 Class 3: Miscellaneous Secured Claims. Class 3
consists of all Secured Claims, other than the Prepetition Credit
Agreement Claims. As described in Article IV hereof, Class 3 is not
impaired and is not entitled to vote on the Plan.
3.04 Class 4: Prepetition Credit Agreement Claims. Class
4 consists of all Prepetition Credit Agreement Claims. As described in
Article IV hereof, Class 4 is not impaired and is not entitled to vote on
the Plan.
3.05 Class 5: Note Claims. Class 5 consists of the Note
Claims. As described in Article V hereof, Class 5 is impaired and is
entitled to vote on the Plan.
3.06 Class 6: General Unsecured Claims Against USL. Class
6 consists of all Claims against USL, other than Claims that are otherwise
classified hereby or that are Administrative Expense Claims. As described
in Article IV hereof, Class 6 is unimpaired and is not entitled to vote on
the Plan.
3.07 Class 7: Interests in Respect of USL Common Stock.
Class 7 consists of all Interests arising from or in any way associated
with the USL Common Stock. As described in Article V hereof, Class 7 is
impaired and is entitled to vote on the Plan.
ARTICLE IV
TREATMENT OF UNIMPAIRED CLASSES
(Classes 1, 2, 3, 4, and 6)
4.01 Class 1 (Priority Tax Claims). Each holder of an
Allowed Class 1 Claim shall be paid in full in Cash the amount of its
Allowed Class 1 Claim as soon as practicable after (but in any event
within thirty days of) the later of (a) the Effective Date and (b) the
date such Class 1 Claim becomes Allowed, unless such holder shall agree to
a different treatment.
4.02 Class 2 (Other Priority Claims). Each holder of an
Allowed Class 2 Claim shall be paid in full in Cash the amount of its
Allowed Class 2 Claim as soon as practicable after (but in any event
within thirty days of) the later of (a) the Effective Date and (b) the
date such Class 2 Claim becomes Allowed, unless such holder shall agree to
a different treatment (including any different treatment that may be
provided for in the documentation governing such Claim).
4.03 Class 3 (Miscellaneous Secured Claims). With respect
to each Allowed Class 3 Claim, unless the holder thereof shall agree to a
different treatment (including any different treatment that may be
provided for in the documentation governing such Claim), the holder of an
Allowed Class 3 Claim shall receive one of the following alternative
treatments, at the election of the Debtor or Reorganized USL made on or
prior to the Effective Date:
(i) The Debtor shall pay such holder in full in Cash
the amount of such Claim as soon as practicable after (but
in any event within thirty days of) the later of (i) the
Effective Date and (ii) the date such Claim becomes
Allowed.
(ii) The Claim shall be Reinstated and the legal,
equitable, and contractual rights to which such Claim
entitles the holder thereof shall be unaltered by this
Plan.
(iii) All collateral securing such Claim shall be
transferred and surrendered to such holder, without
representation or warranty by or recourse against the
Debtor or Reorganized USL.
4.04 Class 4 (Prepetition Credit Agreement Claims). Each
holder of an Allowed Class 4 Claim shall be paid in full in Cash the
amount of its Allowed Class 4 Claim on the Effective Date.
4.05 Class 6 (General Unsecured Claims Against USL). Each
holder of an Allowed Class 6 Claim shall be paid in full in the ordinary
course of business of USL and, accordingly, will not receive any
distribution under the Plan on the Effective Date. Such Allowed Class 6
General Unsecured Claim, if not so paid during the pendency of the Chapter
11 Case, will be Reinstated and will be paid in the ordinary course of
business in accordance with the terms of any invoice or agreement relating
to such Allowed Class 6 Claim or as otherwise provided by applicable non-
bankruptcy law.
4.06 Unimpaired Classes. By virtue of the foregoing
provisions of this Article IV, the Claims in Classes 1, 2, 3, 4, and 6 are
not impaired by the Plan. Pursuant to section 1126(f) of the Bankruptcy
Code, these Classes are conclusively presumed to have accepted the Plan
and are not entitled to vote on the Plan, and solicitation of acceptances
of holders of Claims in those Classes is not required.
ARTICLE V
TREATMENT OF IMPAIRED CLASSES
(Classes 5 and 7)
5.01 Class 5 (Note Claims). On the Effective Date, each
holder of an Allowed Class 5 Claim will receive its pro rata share of
9,700,000 shares of New Common Stock. No fractional shares of New Common
Stock will be issued. In addition, on the Effective Date, the Debtor
shall pay the Informal Noteholder's Committee Expenses in full. No other
distribution will be made to holders of Allowed Class 5 Claims in respect
of their Class 5 Claims, including, without limitation, Claims for accrued
but unpaid interest on the Notes.
5.02 Class 7 (Interests in Respect of USL Common Stock).
On the Effective Date, each holder of an Allowed Class 7 Interest will
receive its pro rata share of 300,000 shares of New Common Stock. No
other distribution will be made to holders of Allowed Class 7 Interests in
respect of their Class 7 Interests.
5.03 Impaired Classes and Interests. By virtue of the
foregoing provisions and Interests of this Article V, Classes 5 and 7 are
impaired under the Plan, and holders of Allowed Claims and Interests in
such Classes are entitled to vote to accept or reject the Plan.
ARTICLE VI
DISPUTED CLAIMS
6.01 Disputed Claims; Objections to Claims. Only Claims
that are Allowed shall be entitled to distributions under the Plan. Until
a Disputed Claim becomes an Allowed Claim, no distributions otherwise
available to the holder of such Claim will be made, and no Cash or shares
of New Common Stock otherwise distributable to such holder will be
distributed. The Debtor reserves the right to contest and object to any
Claims (whether or not a proof of Claim has been filed), including,
without limitation, those Claims that are specifically referenced herein,
that are not listed in the Schedules, are listed in the Schedules as
disputed, contingent, or unliquidated in amount, or are listed in the
Schedules at a lesser amount than asserted by the holder of the Claim.
Any party in interest, including the Debtor, may object to the allowance
of any Claim. Unless otherwise ordered by the Bankruptcy Court, all
objections to Claims (other than Administrative Expense Claims) shall be
filed with the Bankruptcy Court and served upon counsel to the Debtor,
counsel to the Creditors' Committee, if any, and the holder of the Claim
objected to on or before the later of the Effective Date and 25 days after
the date (if any) that a proof of claim is timely filed in respect of such
Claim. The last day for filing objections to Administrative Expense
Claims shall be set pursuant to an order of the Bankruptcy Court.
6.02 Resolution of Claims. Objections filed in the
Bankruptcy Court will be litigated to a Final Order. However, the Debtor
reserves the right to compromise and settle, withdraw, or resolve by any
other method approved by the Bankruptcy Court, any objection to a Disputed
Claim, and may seek the Bankruptcy Court's estimation of any Disputed
Claim pursuant to section 502(c) of the Bankruptcy Code. All Disputed
Claims shall be resolved in the Bankruptcy Court, except to the extent
that (a) the Debtor may otherwise elect consistent with this Plan and the
Bankruptcy Code or (b) the Bankruptcy Court may otherwise order.
As soon as reasonably practicable after a Disputed Claim
becomes an Allowed Claim, or on such date as this Plan shall otherwise
provide, the holder of such Allowed Claim shall receive all payments and
distributions to which such holder is then entitled under this Plan. To
the extent any Claim is disallowed, the Debtor will retain any Cash or New
Common Stock that would otherwise have been distributable on account of
such Claim.
ARTICLE VII
MEANS FOR IMPLEMENTATION OF THE PLAN
7.01 Management of Reorganized USL. On the Effective Date,
the operation of Reorganized USL shall become the general responsibility
of the Post-Restructuring Board, in accordance with applicable law. The
Post-Restructuring Board shall consist of five directors. Four of the
initial directors of Reorganized USL shall be designated by the Informal
Noteholders' Committee. The remaining director shall be nominated by
management of Reorganized USL. All members of the Post-Restructuring
Board shall be deemed to have been elected on the Effective Date However,
in the event that any officer or director is unwilling or unable to take
office at that time, the resulting vacancy shall be filled by action of
the Post-Restructuring Board.
7.02 Restated Articles of Incorporation and Restated By-
Laws. On the Effective Date, Reorganized USL shall be deemed to have
adopted the Restated Articles of Incorporation, which shall (among other
things) include a provision that prohibits the issuance of non-voting
equity securities to the extent required by section 1123(a)(6) of the
Bankruptcy Code, and the Restated By-Laws. As soon as practicable on or
after the Effective Date, Reorganized USL will file its Restated Articles
of Incorporation with the Department of Financial Institutions of the
State of Wisconsin. Except to the extent inconsistent with the terms of
this Plan, after the Effective Date, Reorganized USL may further amend the
Restated Articles of Incorporation and may amend the Restated By-Laws, as
permitted by such Restated Articles of Incorporation, such Restated By-
Laws, and applicable state law.
7.03 Emergence Credit Facility. On the Effective Date,
Reorganized USL shall, in accordance with the Plan, enter into the
Emergence Credit Facility.
7.04 Operations of Debtor Between Confirmation and
Consummation. The Debtor shall continue to operate as debtor-in-
possession, subject to the supervision of the Bankruptcy Court, pursuant
to the Bankruptcy Code, during the period from Confirmation through and
until Consummation, and any obligation incurred by the Debtor during that
period shall constitute an Administrative Expense Claim; provided,
however, that nothing herein shall preclude the Debtor from taking any
step it deems necessary or desirable to prepare for and effect the
Consummation of the Plan.
7.05 Exclusivity. The Debtor shall retain the exclusive
right to amend the Plan and solicit acceptances thereof until
Consummation.
7.06 Term of Injunctions or Stays. Unless otherwise
provided herein or in the Confirmation Order, all injunctions or stays
provided for in the Chapter 11 Case under section 105 or 362 of the
Bankruptcy Code, or otherwise, and extant immediately prior to
Confirmation shall remain in full force and effect until Consummation.
7.07 Cancellation of Existing Securities, Instruments, and
Agreements. On the Effective Date, except as otherwise provided herein,
all securities and all instruments and agreements governing any Claims or
Interests impaired hereby shall be deemed cancelled and terminated, and
the obligations of the Debtor relating to, arising under, in respect of,
or in connection with such securities, instruments, and agreements shall
be discharged; provided, however, that except as otherwise provided
herein, Notes, share certificates, and other evidences of Claims or
Interests shall, effective upon the Effective Date, represent the right to
participate, to the extent such Claims or Interests are Allowed, in the
distributions contemplated by the Plan.
7.08 Distribution of Consideration.
(a) Distribution Agent. Reorganized USL shall distribute all
property to be distributed under this Plan. Reorganized USL may employ or
contract with other entities to assist in or perform the distribution of
such property.
(b) Distribution of Cash. Cash payments made pursuant to this
Plan shall be in legal tender of the United States, by the means agreed to
by the payor and the payee, including by check or wire transfer, or, in
the absence of an agreement, such commercially reasonable manner as the
payor shall determine in its sole discretion.
(c) Distribution of New Common Stock. On the Effective Date,
Reorganized USL will distribute the New Common Stock to the holders of
Allowed Class 5 Claims and Allowed Class 7 Interests in accordance with
the provisions of this Plan.
(d) Fractional Shares. Fractional shares of the New Common
Stock shall not be issued under this Plan. If, but for this section, a
Person would be entitled to receive a fractional share, then such Person
shall be issued in lieu thereof either no share (if such fraction is less
than one-half) or one whole share (if such fraction is equal to or greater
than one-half).
(e) Surrender of Securities. Each holder of a Note, share
certificate, or other instrument evidencing an Allowed Claim or Interest
shall surrender the same to Reorganized USL, and Reorganized USL shall
distribute or shall cause to be distributed to the holders thereof the
appropriate distribution of property hereunder. No distribution of
property hereunder shall be made to or on behalf of any such holder unless
and until such Note, share certificate, or other instrument is received by
Reorganized USL, or the unavailability of such Note, share certificate, or
other instrument is established to the satisfaction of Reorganized USL.
Any such holder that fails to surrender or cause to be surrendered such
Note, share certificate, or other instrument, or to execute and deliver an
affidavit of loss and indemnity satisfactory to Reorganized USL, and, in
the event that Reorganized USL so requests, fails to furnish a bond in
form and substance (including, without limitation, with respect to amount)
reasonably satisfactory to Reorganized USL within two years after the
Effective Date shall be deemed to have forfeited all Claims or Interests
represented by such Note, share certificate, or other instrument and shall
not participate in any distribution hereunder in respect of such Note,
share certificate, or other instrument, and all property in respect of
such forfeited distribution, including (if applicable) interest accrued
thereon, shall irrevocably revert to Reorganized USL. Notwithstanding the
foregoing, all Claims shall be discharged by this Plan to the extent
provided herein regardless of whether and when any surrender, indemnity,
or bond required or permitted by this section is provided, and regardless
of whether Reorganized USL makes a distribution hereunder without
compliance with this section. Reorganized USL, in its sole discretion,
may waive the requirements of this section.
(f) Delivery of Distributions. Distributions to holders of
Allowed Claims and Interests shall be made by Reorganized USL (a) at the
addresses for such holders set forth on the list of record holders of the
Notes and USL Common Stock as of the appropriate Record Date or (b) at the
addresses reflected in USL's books and records. If any holder's
distribution is returned to Reorganized USL, or such other agent as
Reorganized USL may designate, as the case may be, no further
distributions to such holder shall be made unless and until Reorganized
USL, or such other agent as Reorganized USL may designate, as the case may
be, is notified of such holder's then current address, at which time all
missed distributions shall be made to such holder. Amounts in respect of
undeliverable distributions made through Reorganized USL, or any such
other agent as Reorganized USL may designate, as the case may be, shall be
returned to Reorganized USL until such distributions are claimed. All
claims for undeliverable distributions shall be made within two years
following the Effective Date. After such date, all unclaimed property
shall irrevocably revert to Reorganized USL in accordance with section
7.08(g) hereof.
(g) Distribution of Unclaimed Property. If any Person entitled
to receive Cash or New Common Stock under the provisions of this Plan does
not claim such Cash or New Common Stock on the Effective Date, or on such
other date when such Person becomes eligible for distribution of such Cash
or New Common Stock, such Cash or New Common Stock will be set aside and
(in the case of Cash) held in a segregated, interest-bearing fund to be
maintained by Reorganized USL. If such Person presents itself within two
years following the Effective Date, such Cash or New Common Stock,
together with any interest or dividends earned thereupon, will be paid or
distributed by Reorganized USL to such Person. If such Person does not
present itself within two years following the Effective Date, such Cash,
New Common Stock, or any other property distributable under the provisions
of this Plan shall irrevocably revert to Reorganized USL, and the Claim of
any such holder or successor to such holder shall be discharged and
forever barred. Neither the Debtor nor Reorganized USL shall be required
to attempt to locate any such Person.
(h) Setoffs. The Debtor may, but shall not be required to, set
off against any Claim and the payments to be made pursuant to the Plan in
respect of such Claim, any claims of any nature whatsoever that the Debtor
may have against the holder of such Claim, but neither the failure to do
so nor the allowance of any Claim hereunder shall constitute a waiver or
release of any such claim the Debtor may have against such holder.
7.09 Registration Rights Agreement. On or before the
Effective Date, the Debtor shall enter into the Registration Rights
Agreement with Noteholders who may be deemed "affiliates" or
"underwriters" under applicable law.
7.10 Corporate Action. Upon entry of the Confirmation
Order by the Clerk of the Bankruptcy Court, all actions contemplated by
the Plan shall be authorized and approved in all respects (subject to the
provisions of the Plan), including, without limitation, the adoption and
filing with the Department of Financial Institutions of the State of
Wisconsin of the Restated Articles of Incorporation, and the adoption of
the Restated By-Laws. All matters provided for under the Plan involving
the corporate structure of the Debtor or Reorganized USL in connection
with the Plan (including any corporate action required by the Debtor or
Reorganized USL in connection with the Plan) shall be deemed to have
occurred and shall be in effect pursuant to chapter 180 of the Wisconsin
Business Corporation Law and the Bankruptcy Code, without any requirement
of further action by the stockholders or directors of the Debtor or
Reorganized USL.
7.11 Effectuating Documents; Further Transactions. On the
Effective Date, the Chairman of the Post-Restructuring Board, the
President, the Chief Operating Officer, the Chief Financial Officer, or
any other appropriate officer of Reorganized USL, shall be, and they
hereby are, authorized to execute, deliver, file, or record such
contracts, instruments, releases, indentures, certificates, and other
agreements or documents, and take such actions as may be necessary or
appropriate to effectuate and further evidence the terms and conditions of
the Plan in the name of and on behalf of Reorganized USL. The Secretary
or Assistant Secretary of Reorganized USL shall be authorized to certify
or attest to any of the foregoing actions, if necessary.
7.12 Authorization for Management Stock Incentive Program.
Upon the Effective Date, the Post-Restructuring Board shall be, and it
hereby is, authorized, in its sole discretion, to implement a Management
Stock Incentive Program with such terms and conditions that the Post-
Restructuring Board, in its sole discretion, shall deem to be in the best
interests of Reorganized USL, and, pursuant to such terms and conditions,
to authorize the issuance of no more than 1,000,000 additional shares of
New Common Stock to certain employees and officers of Reorganized USL.
7.13 Retiree Benefits. On and after the Effective Date, to
the extent required by section 1129(a)(13) of the Bankruptcy Code,
Reorganized USL shall continue to pay all retiree benefits (if any), as
that term is defined in section 1114 of the Bankruptcy Code, maintained or
established by the Debtor prior to the Confirmation Date, without
prejudice to Reorganized USL's rights under applicable non-bankruptcy law
to modify, amend, or terminate the foregoing arrangements.
7.14 Ordinary Course and Scheduled Liabilities. Subject to
the terms hereof, neither holders of Claims that are listed on the
Debtor's Schedules and are not listed as disputed, contingent,
unliquidated, or unknown, nor holders of Claims relating to liabilities
arising before or after the Petition Date in respect of goods and services
purchased by USL in the ordinary course of its business, nor the
Prepetition Lenders, nor, as the case may be, the Banks shall be required
to file any proof of Claim or request for payment of such Claims, unless
the holder of such Claim disputes the amount of the Claim as scheduled by
the Debtor. Such Claims shall be paid or otherwise satisfied by the
Debtor and/or Reorganized USL in accordance with the terms of this Plan,
without any further action by the holders of such Claims.
7.15 Effect of Failure to File Proof of Claim by Bar Date.
In accordance with the provisions of the Bankruptcy Code and the
Bankruptcy Rules, the Debtor will request that the Bankruptcy Court enter
an order establishing the last date and time by which proofs of Claims
(other than Claims of governmental authorities) against, and proofs of
Interests in, USL must be filed (the "Bar Date"). Except as provided in
section 7.14 hereof, or as otherwise provided by a Final Order of the
Bankruptcy Court, any Claim or Interest with respect to which the holder
of such Claim or Interest has not filed a proof of Claim or proof of
Interest by the Bar Date shall be forever barred and any obligation of USL
with respect to such Claim or Interest shall be discharged and released to
the fullest extent authorized or provided by the Bankruptcy Code,
including, without limitation, by sections 524 and 1141(d)(1)(A) of the
Bankruptcy Code.
ARTICLE VIII
ACCEPTANCE OR REJECTION OF THE PLAN; EFFECT OF REJECTION BY
IMPAIRED CLASSES OF CLAIMS
8.01 Classes Entitled to Vote. Each impaired Class that
will receive or retain property or any interest in property under the Plan
shall be entitled to vote to accept or reject the Plan. Any Class of
Claims that is not impaired shall be deemed to have accepted the Plan and
shall not be entitled to vote to accept or reject the Plan.
8.02 Class Acceptance Requirement. Under section 1126(c)
of the Bankruptcy Code, Class 5 has accepted the Plan if the holders of at
least two-thirds (2/3) in amount and more than one-half (1/2) in number of
Allowed Claims of such Class who have timely voted on the Plan have voted
to accept the Plan. Under section 1126(d) of the Bankruptcy Code, Class 7
has accepted the Plan if the holders of at least two-thirds (2/3) in
amount of Allowed Interests of such Class who have timely voted on the
Plan have voted to accept the Plan.
8.03 Cram Down. The Debtor reserves the right to request
Confirmation of the Plan, as it may be modified from time to time, under
section 1129(b) of the Bankruptcy Code.
ARTICLE IX
PRESERVATION OF LITIGATION CLAIMS AND RIGHTS OF ACTION
9.01 Retained Litigation Claims and Rights of Action. In
accordance with section 1123(b)(3) of the Bankruptcy Code, except for (a)
avoidance actions arising under section 547 of the Bankruptcy Code (which
would be meaningless, given the treatment of Claims hereunder, which
negates the possibility of transfers subject to avoidance thereunder), and
(b) to the extent otherwise provided in this Plan or in the Confirmation
Order, Reorganized USL shall retain and may expressly, in its sole
discretion, enforce, sue on, settle, or compromise (or decline to do any
of the foregoing), all claims, rights of action, suits, and proceedings,
whether in law or in equity, whether known or unknown (including, without
limitation, any and all avoidance actions that USL, Reorganized USL, or
the Estate may hold against any Person), and such claims, rights of
action, suits, and proceedings shall remain assets of Reorganized USL.
Reorganized USL or any of its successors may pursue such claims and rights
of action, as appropriate, in accordance with the best interests of
Reorganized USL or its successors who hold such claims or rights of
action.
9.02 Preservation of Insurance. The Debtor's discharge and
release from all Claims as provided herein, except as necessary to be
consistent with this Plan, shall not diminish or impair the enforceability
of any insurance policy that may cover Claims against USL or any other
Person.
ARTICLE X
EXECUTORY CONTRACTS AND UNEXPIRED LEASES
10.01 Assumption. On and as of the Confirmation Date, all
executory contracts and unexpired leases that exist between the Debtor and
any Person are hereby specifically assumed, except for any executory
contracts and unexpired leases that have been specifically rejected by the
Debtor with the approval of the Bankruptcy Court on or before the
Confirmation Date or in respect of which a motion for rejection has been
filed with the Bankruptcy Court on or before the Confirmation Date. Entry
of the Confirmation Order by the Clerk of the Bankruptcy Court shall
constitute approval of such assumptions pursuant to section 365(a) of the
Bankruptcy Code. Claims created by the rejection of executory contracts
and unexpired leases must be filed with the Bankruptcy Court no later than
20 days after entry of a Final Order authorizing such rejection (or, if
later, the Bar Date established by the Bankruptcy Court for prepetition
Claims generally). Any such Claims not filed within such time shall be
forever barred from assertion against the Debtor, Reorganized USL, and
their respective properties and estates.
10.02 Payments Related to Assumption. Any monetary amounts
by which any executory contract or unexpired lease to be assumed under the
Plan may be in default shall be satisfied by Cure under section 365(b)(1)
of the Bankruptcy Code, at the option of the Debtor or the assignee of the
Debtor assuming such contract or lease. In the event of a dispute
regarding (i) the nature or amount of any Cure, (ii) the ability of
Reorganized USL or any assignee to provide "adequate assurance of future
performance" (within the meaning of section 365 of the Bankruptcy Code)
under the contract or lease to be assumed, or (iii) any other matter
pertaining to assumption, Cure shall occur following the entry of a Final
Order resolving the dispute and approving the assumption and, as the case
may be, assignment.
10.03 Officers' and Directors' Indemnification Rights.
Notwithstanding any other provisions of the Plan, the obligations of the
Debtor to indemnify its or its parents', subsidiaries', or affiliates'
present and former directors, officers, and employees against any
obligations, liabilities, costs, or expenses pursuant to the articles of
incorporation or by-laws of the Debtor, applicable state law, specific
agreement, or any combination of the foregoing, shall not survive
Confirmation of the Plan and shall be discharged, regardless of whether
indemnification is owed in connection with an event occurring prior to,
upon, or subsequent to the commencement of the Chapter 11 Case; provided,
however, that Reorganized USL shall maintain in force for a period of two
years following the Effective Date policies of Directors' and Officers'
Liability Insurance, covering pre-Effective Date directors and officers of
USL and containing substantially the same provisions and limits of
coverage as the policies that were in force on the Petition Date, and
Reorganized USL shall also be responsible for paying the deductible or
retention amounts under such policies for such two-year period.
10.04 Compensation and Benefit Programs. All employment and
severance agreements and policies, and all employee compensation and
benefit plans, policies, and programs of the Debtor applicable generally
to its employees, including agreements and programs subject to sections
1114 and 1129(a)(13) of the Bankruptcy Code, as in effect on the Effective
Date, including, without limitation, all savings plans, retirement plans,
health care plans, disability plans, severance benefit plans, incentive
plans, and life, accidental death, and dismemberment insurance plans,
shall be deemed to be, and shall be treated as though they are, executory
contracts that are assumed under this Plan, but only to the extent that
rights under such agreements and programs are held by the Debtor or
Persons who are USL employees as of Confirmation, and the Debtor's
obligations under such agreements and programs to Persons who are
employees of the Debtor on Confirmation shall survive Confirmation of this
Plan, without prejudice to Reorganized USL's rights under applicable non-
bankruptcy law to modify, amend, or terminate the foregoing arrangements,
except for (i) such executory contracts or plans specifically rejected
pursuant to the Plan (to the extent such rejection does not violate
sections 1114 and 1129(a)(13) of the Bankruptcy Code) and (ii) such
executory contracts or plans as have previously been rejected, pursuant to
a Final Order, or specifically waived by the beneficiaries of such plans,
contracts, or programs.
ARTICLE XI
CONDITIONS PRECEDENT
11.01 Conditions to Confirmation. The Plan shall not be
confirmed unless the aggregate amount of Allowed Class 6 General Unsecured
Claims on the date of the Confirmation Hearing is less than $25,000,000,
unless this condition is waived pursuant to section 11.03 hereof.
11.02 Conditions to Consummation. The Plan shall not be
consummated unless and until the following conditions shall have been
satisfied or waived pursuant to section 11.03 hereof:
(a) The Confirmation Order shall have been entered in form and
substance reasonably acceptable to the Debtor, the Informal Noteholders'
Committee, and (i) the Prepetition Lenders, provided that the Prepetition
Lenders have extended the DIP Credit Facility or, as the case may be, (ii)
the Banks, provided that the Banks have extended the DIP Credit Facility.
(b) The Confirmation Order shall have become a Final Order and
provide, among other things, that:
(i) The provisions of the Confirmation Order are non-
severable and mutually dependent.
(ii) Except as expressly provided in the Plan, USL is
discharged effective upon Confirmation from any "debt" (as that term
is defined in section 101(12) of the Bankruptcy Code), and the
Debtor's liability in respect thereof is extinguished completely,
whether reduced to judgment or not, liquidated or unliquidated,
contingent or non-contingent, asserted or unasserted, fixed or
unfixed, matured or unmatured, disputed or undisputed, legal or
equitable, or known or unknown, or that arose from any agreement of
USL that has either been assumed or rejected in the Chapter 11 Case
or pursuant to the Plan, or obligation of USL incurred before
Confirmation, or from any conduct of USL prior to Confirmation, or
that otherwise arose before Confirmation, including, without
limitation, all interest, if any, on any such debts, whether such
interest accrued before or after the Petition Date.
(iii) The Plan does not provide for the liquidation of all
or substantially all of the property of USL, and its Confirmation is
not likely to be followed by the liquidation of Reorganized USL or
the need for further financial reorganization.
(iv) Any objection, not previously withdrawn or settled,
to the adequacy of the information contained in the Disclosure
Statement is overruled, and the information contained in the
Disclosure Statement was adequate for the purpose of soliciting
Ballots for Confirmation of the Plan.
(c) The Post-Restructuring Board shall have been designated.
(d) The Bankruptcy Court shall have entered one or more orders
(which may be the Confirmation Order), which have become Final Orders,
authorizing the assumption and assignment of all unexpired leases and
executory contracts that were not expressly rejected.
(e) No request for revocation of the Confirmation Order under
section 1144 of the Bankruptcy Code shall have been made or, if made,
shall remain pending.
(f) All other actions required by Article VII to occur on or
before the Effective Date shall have occurred.
(g) None of the Debtor's pension plans shall have been
terminated.
(h) The Emergence Credit Facility shall have been entered into
among Reorganized USL and the Prepetition Lenders or, as the case may be,
the Banks, and all agreements, instruments, or other documents
contemplated by the Emergence Credit Facility shall have been executed by
Reorganized USL and the Prepetition Lenders or, as the case may be, the
Banks, and all of the conditions precedent to the effectiveness of such
agreements, instruments, and other documents (other than Consummation of
the Plan) shall have been satisfied in full or duly waived.
(i) The Debtor shall have concurrently satisfied all of its
obligations under the DIP Credit Facility, and the DIP Credit Facility
shall have been terminated.
(j) The Debtor shall have entered into the Registration Rights
Agreement.
11.03 Waiver of Conditions. The Debtor and the Informal
Noteholders' Committee may, in writing, waive any of the conditions set
forth in sections 11.01 or 11.02 hereof at any time without notice or
hearing, without leave or order of the Bankruptcy Court, and without any
formal action other than proceeding to consummate the Plan; provided,
however, that the waiver of the conditions set forth in sections 11.01,
11.02(a), (b), (h), and (i) shall also require the written consent of (i)
the Prepetition Lenders, provided that the Prepetition Lenders have
extended the DIP Credit Facility, or, as the case may be, (ii) the Banks,
provided that the Banks have extended the DIP Credit Facility.
11.04 Effect of Failure of Conditions. If one or more of
the conditions specified in sections 11.01 or 11.02 of the Plan have not
occurred or been duly waived as provided in section 11.03 on or before 60
days after the Confirmation Date, upon notification submitted by the
Debtor to the Bankruptcy Court, to counsel for the Informal Noteholders'
Committee, and to counsel for the Prepetition Lenders or the Banks, as
appropriate under section 11.03 hereof, (a) the Confirmation Order shall
be vacated, (b) no distributions under the Plan shall be made, (c) the
Debtor and all holders of Claims and Interests shall be restored to the
status quo ante as of the Business Day immediately preceding the
Confirmation Date as though the Confirmation Date never occurred, and (d)
the Debtor's obligations with respect to the Claims and Interests shall
remain unchanged and nothing contained herein shall constitute or be
deemed a waiver or release of any Claims or Interests by or against the
Debtor or any other person or to prejudice in any manner the rights of the
Debtor or any person in any further proceedings involving the Debtor.
11.04 Notice to Bankruptcy Court. The Debtor shall notify
the Bankruptcy Court in writing promptly after the Effective Date that the
Plan has become effective.
ARTICLE XII
MODIFICATION, REVOCATION, OR WITHDRAWAL OF THE PLAN
12.01 Modification of Plan. The Debtor may alter, amend, or
modify the Plan or any exhibits thereto under section 1127(a) of the
Bankruptcy Code at any time prior to the Confirmation Date. The Debtor
shall provide parties in interest with notice of such amendments or
modifications as may be required by the Bankruptcy Rules or order of the
Bankruptcy Court and shall, in any event, provide such notice to counsel
to the Creditors' Committee, if any, counsel to the Informal Noteholders'
Committee, and counsel to the Prepetition Lenders or the Banks, as
appropriate.
After the Confirmation Date and prior to the substantial
Consummation of the Plan, as defined in section 1101(2) of the Bankruptcy
Code, the Debtor may, under section 1127(b) of the Bankruptcy Code, and so
long as the treatment of holders of Claims or Interests under the Plan is
not adversely affected, institute proceedings in the Bankruptcy Court to
remedy any defect or omission or to reconcile any inconsistencies in the
Plan, the Disclosure Statement approved with respect to the Plan, the
Confirmation Order, and any other matters as may be necessary to carry out
the purposes and effects of the Plan; provided, however, that prior notice
of such proceedings shall be served in accordance with Bankruptcy Rule
2002, or order of the Bankruptcy Court.
12.02 Revocation or Withdrawal of Plan.
(a) Right to Revoke. The Debtor reserves the right to revoke
or withdraw the Plan prior to the Confirmation Date.
(b) Effect of Withdrawal or Revocation. If the Debtor revokes
or withdraws the Plan prior to the Confirmation Date, or if Confirmation
or the Effective Date does not occur, then the Plan, any settlement or
compromise embodied in the Plan (including the fixing or limiting to an
amount certain any Claim or Class of Claims), assumption or rejection of
any executory contract or unexpired lease affected by the Plan, and any
document or agreement executed pursuant to or in furtherance of the Plan,
shall be deemed null and void. In such event, nothing contained herein,
and no acts taken in preparation for Consummation of the Plan, shall be
deemed to constitute a waiver or release of any Claims by or against the
Debtor or any other Person or to prejudice in any manner the rights of the
Debtor or any Person in any further proceedings involving the Debtor or to
constitute an admission of any sort by the Debtor or any other Person.
12.03 Nonconsensual Confirmation. In the event that any
impaired Class of Claims or Interests shall fail to accept the Plan in
accordance with section 1129(a)(8) of the Bankruptcy Code, the Debtor
reserves the right (a) to request that the Bankruptcy Court confirm the
Plan in accordance with section 1129(b) of the Bankruptcy Code or (b) to
modify the Plan in accordance with section 12.01 hereof.
ARTICLE XIII
EFFECT OF CONFIRMATION
13.01 Binding Effect. The provisions of this Plan shall be
binding upon and inure to the benefit of USL, Reorganized USL, the holders
of Claims, whether or not they have voted to accept the Plan, the holders
of Interests, whether or not they have voted to accept the Plan, and their
respective successors and assigns.
13.02 Discharge of Debtor. All property distributed under
the Plan shall be in exchange for, and in complete satisfaction,
settlement, discharge, and release of, all Claims and Interests of any
nature whatsoever against the Debtor or any of its assets or properties,
and, except as otherwise provided herein or in the Confirmation Order,
upon Confirmation, USL shall be deemed discharged and released to the
fullest extent authorized or provided by the Bankruptcy Code, including,
without limitation, by sections 524 and 1141(d)(1)(A) of the Bankruptcy
Code. The entry of the Confirmation Order shall be, provided that the
Effective Date occurs, a judicial determination of discharge and release
of all liabilities of USL.
13.03 Injunction. Except as otherwise expressly provided
herein, the entry of the Confirmation Order shall, provided that the
Effective Date occurs, permanently enjoin all Persons that have held,
currently hold, or may hold a Claim or other debt or liability that is
discharged or released pursuant to the Plan or who have held, currently
hold, or may hold an Interest terminated pursuant to the Plan from taking
any of the following actions in respect of such discharged or released
Claim, debt, or liability or such terminated Interest: (a) commencing,
conducting, or continuing in any manner, directly or indirectly, any suit,
action, or other proceeding of any kind against the Debtor, Reorganized
USL, or their respective property; (b) enforcing, levying, attaching,
collecting, or otherwise recovering in any manner or by any means, whether
directly or indirectly, any judgment, award, decree, or order against the
Debtor, Reorganized USL, or their respective property; (c) creating,
perfecting, or enforcing in any manner, directly or indirectly, any lien
or encumbrance of any kind against the Debtor, Reorganized USL, or their
respective property; (d) asserting any setoff, right of subrogation, or
recoupment of any kind, directly or indirectly, against any debt,
liability, or obligation due to the Debtor, Reorganized USL, or their
respective property; and (e) proceeding in any manner in any place
whatsoever that does not conform to or comply with or is inconsistent with
the provisions of the Plan.
13.04 Revesting. Except as otherwise expressly provided
herein or in the Confirmation Order, pursuant to section 1141(b) of the
Bankruptcy Code, on the Effective Date, all property and assets of the
Estate of the Debtor shall revest in Reorganized USL, free and clear of
all Claims, liens, encumbrances, charges, Interests, and other interests
of creditors and equity security holders arising on or before the
Effective Date. Thereafter, Reorganized USL may operate its business,
from and after the Effective Date, free of any restrictions imposed by the
Bankruptcy Code or by the Bankruptcy Court. Without limiting the
foregoing, Reorganized USL may, without application to or approval by the
Bankruptcy Court, pay Professional Fees and expenses that it may incur
after Confirmation.
13.05 Operation of Business. Until the Effective Date, the
Debtor shall operate its business as debtor-in-possession under the
Bankruptcy Code. On and after the Effective Date, Reorganized USL shall
operate its business and may buy, use, acquire, and dispose of its assets
free of any restrictions contained in the Bankruptcy Code or imposed by
the Bankruptcy Court, except as provided herein.
13.06 Releases. Except as otherwise specifically provided
for by this Plan, any Person accepting any distribution of Cash, New
Common Stock, or any other property pursuant to this Plan (including any
creditor whose Claim is unimpaired) shall be presumed conclusively to have
released USL, Reorganized USL, and their current and former parents,
subsidiaries, and affiliates, and their respective current and former
directors, officers, shareholders, employees, agents, representatives,
attorneys, accountants, advisors, financial advisors, and other
professionals retained by USL, Reorganized USL, and their respective
current and former parents, subsidiaries, and affiliates, and their
predecessors, successors and assigns, and any Person claimed to be liable
derivatively through any of the foregoing, from any and all claims, debts,
actions, or causes of action, whether known or unknown, and whether based
upon facts now known or unknown, direct or derivative, in law, equity, or
bankruptcy, that any such Person, and anyone claiming in a derivative
capacity from such Person, had, now has, or hereafter can, shall, or may
have against such Persons, from the beginning of the world to the
Effective Date, arising from, in connection with, or related to any act or
omission related to the Debtor, the Chapter 11 Case, or the Plan, except
for willful misconduct or gross negligence. The release described in the
preceding sentence shall be enforceable as a matter of contract law
against any Person that accepts any distribution pursuant to this Plan
(including each creditor whose Claim is unimpaired).
Upon the Effective Date, Reorganized USL and each Person
accepting any distribution of Cash, New Common Stock, or any other
property under the Plan (including each creditor whose Claim is
unimpaired) will be conclusively deemed to have released and discharged
the following parties, their current and former members, parents,
subsidiaries, affiliates, directors, officers, shareholders, employees,
agents, representatives, attorneys, accountants, advisors, financial
advisors, and other professionals retained by such parties, and their
predecessors, successors, and assigns: (i) the Debtor, (ii) the
Creditors' Committee, if any, (iii) the Informal Noteholders' Committee;
(iv) the Prepetition Lenders; (v) the Banks; (vi) all Stockholders; and
(vii) all Noteholders (collectively, the "Released Persons") from any and
all liability, claims, debts, actions, or causes of action, whether known
or unknown and whether based upon facts now known or unknown, direct or
derivative, in law, equity, or bankruptcy, which Reorganized USL, the
Debtor, or any Person accepting a distribution under the Plan had, now
has, or hereafter can, shall, or may have against such Released Persons,
from the beginning of the world to the Effective Date, arising from, in
connection with, or related to any act or omission related to the Notes,
the Interests, the negotiation and prosecution of the Plan, or to such
Released Person's past service with, for, or on behalf of the Debtor,
including, but not limited to, prosecution of the Chapter 11 Case, except
for willful misconduct or gross negligence. The release described in the
preceding sentence shall be enforceable as a matter of contract law
against any Person that accepts any distribution pursuant to this Plan
(including each creditor whose Claim is unimpaired).
The releases embodied in this Plan are in addition to, and not
in lieu of, any other release separately given, conditionally or
unconditionally.
13.07 Exculpation. Neither USL, Reorganized USL, the
Creditors' Committee, if any, the Informal Noteholders' Committee, the
Prepetition Lenders, the Banks, nor any of their respective present or
former parents, subsidiaries, affiliates, members, officers, directors,
employees, agents, attorneys, accountants, or other advisors, shall have
or incur any liability to any holder of a Claim or Interest, any Person
accepting any distribution of Cash, New Common Stock, or any other
property under the Plan (including each creditor whose Claim is
unimpaired), or any of their respective agents, employees,
representatives, financial advisors, attorneys, or affiliates, or any of
their respective successors or assigns, for any act or omission in
connection with, relating to, or arising out of, the negotiation of the
Plan, the solicitation of acceptance of the Plan, the pursuit of
Confirmation of the Plan, the Consummation of the Plan, or the
administration of the Plan or the property to be distributed under the
Plan, except for willful misconduct or gross negligence; and in all
respects such Persons shall be entitled to rely upon the advice of counsel
with respect to their duties and responsibilities under the Plan and will
be fully protected in acting or in refraining from action in accordance
with such advice.
13.08 Termination of Committees. The appointment of each
official statutory committee appointed in the Chapter 11 Case, if any,
shall terminate on the Effective Date.
ARTICLE XIV
RETENTION OF JURISDICTION
14.01 Jurisdiction of Bankruptcy Court. Following the
Effective Date, the Bankruptcy Court will retain exclusive jurisdiction,
under sections 105(a) and 1142 of the Bankruptcy Code, of all matters
arising out of, and related to, the Chapter 11 Case and the Plan
including, among other things, the following matters:
(a) All adversary proceedings, applications, motions,
contested matters, and other litigated matters pending on the Effective
Date, and all claims by or against USL arising under the Bankruptcy Code
or non-bankruptcy law (if made applicable under the Bankruptcy Code),
including claims to avoid fraudulent transfers under section 548 of the
Bankruptcy Code, whether such claims are commenced before or after the
Effective Date.
(b) Proceedings to ensure that distributions to holders of
Allowed Claims and Allowed Interests are accomplished as provided herein.
(c) All pending or future objections to or requests for
estimation of Claims and Interests, including any objections to the
classification of any Claim or Interest, and proceedings to allow,
disallow, or estimate any Claim or Interest, in whole or in part.
(d) Proceedings to enter and implement such orders as may be
appropriate in the event the Confirmation Order is for any reason stayed,
revoked, modified, or vacated.
(e) Proceedings to construe and to take any action to enforce
the Plan or the Confirmation Order and to issue such orders as may be
necessary for the implementation, execution, and Consummation of the Plan.
(f) Proceedings to hear and determine any applications to
modify the Plan, to cure any defect or omission or to reconcile any
inconsistency in the Plan, including any exhibit thereto, or in any order
of the Bankruptcy Court, including, without limitation, the Confirmation
Order, as may be necessary to carry out the purposes and intent of the
Plan and to implement and effectuate the Plan.
(g) Proceedings to hear and determine all applications for
Professional Fees, compensation, and reimbursement of expenses under
sections 330, 331, and 503(b) of the Bankruptcy Code.
(h) Proceedings to hear and determine all pending or future
controversies, suits, and disputes that may arise in connection with the
interpretation, implementation, or enforcement of the Plan or any
documents intended to implement the provisions of the Plan.
(i) Proceedings to consider and rule on the compromise and
settlement of any Claim against or cause of action on behalf of USL or its
Estate.
(j) Proceedings to hear and determine, if necessary, or to
estimate or liquidate any and all Claims arising from the rejection of
executory contracts or unexpired leases, pursuant to the Plan or
otherwise.
(k) Proceedings to determine such other matters as may be
provided for in the Confirmation Order or other orders of the Bankruptcy
Court as may be authorized under the provisions of the Bankruptcy Code or
any other applicable law.
(l) Proceedings to enforce all orders, judgments, injunctions,
and rulings entered in the Chapter 11 Case.
(m) Proceedings to issue such orders as may be necessary or
appropriate in aid of Confirmation and to facilitate Consummation of the
Plan.
(n) Proceedings to recover all assets of USL, or property of
its Estate, wherever located.
(o) Proceedings to hear and determine other issues presented
or arising under the Plan.
(p) Proceedings to hear and determine any other matters
related hereto and not inconsistent with chapter 11 of the Bankruptcy
Code.
(q) Entry of a final decree closing the Chapter 11 Case.
Following the Effective Date, the Bankruptcy Court will retain
non-exclusive jurisdiction of the Chapter 11 Case for the following
purposes:
(a) To hear and determine any motions or contested matters
involving taxes, tax refunds, tax attributes, tax benefits, and similar or
related matters with respect to the Debtor or its Estate arising prior to
the Effective Date or relating to the period of administration of the
Chapter 11 Case, including, without limitation, matters concerning state,
local, and federal taxes, in accordance with sections 346, 505 and 1146 of
the Bankruptcy Code.
(b) To hear any other matter not inconsistent with the
Bankruptcy Code.
14.02 Failure of Bankruptcy Court to Exercise Jurisdiction.
If the Bankruptcy Court abstains from exercising or declines to exercise
jurisdiction over any matter arising under, arising in, or related to the
Chapter 11 Case, including with respect to the matters set forth above in
section 14.01 hereof, this Article shall not prohibit or limit the
exercise of jurisdiction by any other court having competent jurisdiction
with respect to such subject matter.
ARTICLE XV
MISCELLANEOUS PROVISIONS
15.01 Time. In computing any period of time prescribed or
allowed by the Plan, Bankruptcy Rule 9006 shall apply, unless otherwise
expressly provided.
15.02 Headings. The headings and captions to articles,
sections, and exhibits used in this Plan are inserted for convenience of
reference only and neither constitute a portion of the Plan nor in any
manner affect the provisions or interpretation of the Plan.
15.03 Saturday, Sunday, or Legal Holiday. If any payment or
act under the Plan is required to be made or performed on a date that is
not a Business Day, then the making of such payment or the performance of
such act may be completed on the next succeeding Business Day, but shall
be deemed to have been completed as of the required date.
15.04 Payment of Statutory Fees. All fees payable pursuant
to section 1930 of title 28 of the United States Code, as determined by
the Bankruptcy Court at the hearing pursuant to section 1128 of the
Bankruptcy Code, shall be paid on or before the Effective Date.
15.05 Severability. Should any provision of this Plan be
determined to be unenforceable, such determination shall in no way limit
or affect the enforceability and operative effect of any or all other
provisions of this Plan. To the extent that any provision of the Plan
would, by its inclusion in the Plan, prevent or preclude the Bankruptcy
Court from entering the Confirmation Order, the Bankruptcy Court, on the
request of the Debtor, may modify or amend, or permit the Debtor to modify
or amend, such provision, in whole or in part as necessary to cure any
defect or remove any impediment to Confirmation of the Plan existing by
reason of such provision; provided, however, that such modification or
amendment must be otherwise permitted under section l2.01 of this Plan.
15.06 Modification of Treatment of Claims or Interests. The
Debtor and Reorganized USL reserve the right to modify the treatment of
any Allowed Claim or Interest in any manner adverse only to the holder of
such Claim or Interest at any time after Consummation upon the consent of
the holder of the Allowed Claim or Interest being adversely affected.
15.07 Section 1145 Exemption. Pursuant to, in accordance
with, and solely to the extent provided under section 1145 of the
Bankruptcy Code, the issuance of the New Common Stock under this Plan is
exempt from the registration requirements of Section 5 of the Securities
Act, as amended, and any State or local law requiring registration for
offer or sale of a security or registration or licensing of an issuer of,
underwriter of, or broker or dealer in such New Common Stock and is deemed
to be a public offering of the New Common Stock.
15.08 Section 1146 Exemption. To the extent permitted by
section 1146(c) of the Bankruptcy Code, the issuance, transfer, or
exchange of any security under the Plan, or the execution, delivery, or
recording of an instrument of transfer pursuant to, in implementation of,
or as contemplated by the Plan, or the revesting, transfer, or sale of any
property of the Debtor, pursuant to, in implementation of, or as
contemplated by the Plan shall not be taxed under any State or local law
imposing a stamp tax, transfer tax, or similar tax or fee. Consistent
with the foregoing, each recorder of deeds or similar official for any
county, city, or other governmental unit in which any instrument hereunder
or of the type referred to above is to be recorded shall, pursuant to the
Confirmation Order, be ordered and directed to accept such instrument,
without requiring the payment of any documentary stamp tax, deed stamps,
stamp tax, transfer tax, intangible tax, or similar tax.
15.09 Governing Law. Except to the extent the Bankruptcy
Code, the Bankruptcy Rules, or other federal laws apply, the laws of the
State of Wisconsin shall govern the construction and implementation of the
Plan and all rights and obligations arising under the Plan. The laws of
the State of Wisconsin shall govern all corporate governance matters.
15.10 Withholding and Reporting Requirements. In connection
with the Plan and all instruments issued in connection therewith and
distributions thereon, the Debtor shall comply with all withholding and
reporting requirements imposed by any federal, state, local, or foreign
taxing authority, and all distributions hereunder shall, to the extent
applicable, be subject to any such withholding and reporting requirements.
15.11 Notice. Any notice required or permitted to be
provided to the Debtor in connection with the Plan shall be in writing and
served by (a) certified mail, return receipt requested; (b) hand delivery;
or (c) overnight delivery service, to be addressed as follows:
To the Debtor:
United States Leather, Inc.
1403 West Bruce Street
Milwaukee, WI 53204
Attention: Mr. Kinzie L. Weimer
With a copy to:
Foley & Lardner
777 East Wisconsin Avenue, Suite 3800
Milwaukee, WI 53202
Attention: Thomas L. Shriner, Jr.
To the Informal Noteholders' Committee:
Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, NY 10019
Attention: Chaim J. Fortgang.
To the Prepetition Lenders:
Kaye, Scholer, Fierman, Hays & Handler, LLP
425 Park Avenue
New York, NY 10022
Attention: Herbert S. Edelman
(or counsel for the Banks as may be subsequently designated):
Dated: Milwaukee, Wisconsin
June 12, 1998
Respectfully submitted,
UNITED STATES LEATHER, INC.
/s/ Anthony Biancanello
Anthony Biancanello, President
