NOT A SOLICITATION OF ACCEPTANCE OR REJECTION OF THE PLAN.
ACCEPTANCES OR REJECTIONS MAY NOT BE SOLICITED UNTIL THE
BANKRUPTCY COURT HAS APPROVED THIS DISCLOSURE STATEMENT. THIS
DISCLOSURE STATEMENT IS BEING SUBMITTED FOR APPROVAL BUT HAS NOT
YET BEEN APPROVED BY THE COURT.
UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF NEW YORK
)
In re: ) Chapter 11
)
AGERA ENERGY LLC, et al.,1 )
)
Case No. 19-23802 (RDD)
Debtors.
)
)
(Jointly Administered)
DISCLOSURE STATEMENT FOR JOINT CHAPTER 11 PLAN OF LIQUIDATION OF
AGERA ENERGY LLC, ET AL.
IMPORTANT DATES
Date by which Objections to Confirmation
of the Plan Must be Filed and Served:
June 3, 2020 at 4:00 p.m.
Date by which Ballots Must be Received: June 3, 2020 at 4:00 p.m.
Hearing on Confirmation of the Plan: June 8, 2020 at 2:00 p.m.
MCDERMOTT WILL & EMERY LLP
Timothy W. Walsh
Darren Azman
Ravi Vohra
Natalie Rowles
340 Madison Avenue
New York, New York 10173
Telephone: (212) 547-5615
Facsimile: (212) 547-5444
Counsel to the Debtors and Debtors in Possession
Dated: April 1, 2020
New York, New York
1 The Debtors, together with the last four digits of each Debtor’s federal tax identification number, are: Agera
Energy LLC (8122); Agera Holdings, LLC (3335); energy.me midwest llc (9484); Aequitas Energy, Inc. (7988);
Utility Recovery LLC (4351); and Agera Solutions LLC (8749). The location of the Debtors’ corporate
headquarters and the service address for all Debtors is 555 Pleasantville Road, S-107, Briarcliff Manor, NY 10510.
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TABLE OF CONTENTS
I. PURPOSES AND LIMITATIONS OF DISCLOSURE STATEMENT .............................1
A. Purpose of Disclosure Statement .............................................................................1
B. Definitions and Exhibits ..........................................................................................1
C. Enclosures ................................................................................................................2
D. Representations and Limitations ..............................................................................2
E. Important Dates ........................................................................................................3
F. Solicitation Procedures ............................................................................................4
G. Recommendation .....................................................................................................5
H. Inquiries ...................................................................................................................5
II. BACKGROUND .................................................................................................................5
A. Nature of the Debtors’ Business ..............................................................................5
B. Organizational Structure ..........................................................................................5
C. Prepetition Capital Structure ....................................................................................6
D. Circumstances Leading to Filing .............................................................................8
E. Potential Estate Causes of Action ..........................................................................11
F. The Bankruptcy Cases ...........................................................................................11
III. SIGNIFICANT EVENTS DURING THE CHAPTER 11 CASE .....................................12
A. First Day Pleadings ................................................................................................12
B. Other Significant Pleadings ...................................................................................13
C. Postpetition Financing and Use of Cash Collateral ...............................................14
D. Key Employee Retention Plan and Key Employee Incentive Plan .......................14
E. The Appointment of the Committee ......................................................................15
F. Retention of Professionals; Appointment of Claims and Noticing
Agent ......................................................................................................................15
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G. Schedules of Assets and Liabilities, Statements of Financial
Affairs ....................................................................................................................15
H. Bar Date for Filing of Claims Arising Prior to the Petition Date ..........................16
I. Sale of the Agera Opco Entities’ Assets ................................................................16
J. Challenge Period Extensions/Standing Motion .....................................................18
K. Plan Support Agreement ........................................................................................18
L. Massachusetts DOER Administrative Expense Claim ..........................................18
M. Sunwave Adversary Proceeding ............................................................................19
IV. SUMMARY OF THE PLAN OF LIQUIDATION ...........................................................19
A. General Plan Objectives .........................................................................................19
B. Provisions Governing Order and Method for Distributions Under
the Plan...................................................................................................................20
C. Classes of Claims ...................................................................................................20
i. DIP Financing Claims ................................................................................21
ii. Administrative Expense Claims .................................................................21
iii. Professional Fee Claims .............................................................................21
iv. Priority Tax Claims ....................................................................................21
v. Non-Tax Priority Claims............................................................................22
vi. Intercompany Claims .................................................................................22
vii. Class 1A (Allowed Other Secured Claims) ...............................................22
viii. Class 1B (Allowed Prepetition BP Secured Claim) ..................................22
ix. Class 2 (Allowed General Unsecured Claims) ..........................................23
x. Class 3 (Allowed BP Deficiency Claim and Allowed BP
Subordinated Claim) ..................................................................................23
xi. Class 4 (Prepetition CBLIC Claims)..........................................................24
xii. Class 5 (Interests) .......................................................................................24
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V. MEANS OF IMPLEMENTING THE PLAN ....................................................................24
A. Joint Chapter 11 Plan .............................................................................................24
B. Substantive Consolidation of Claims Against Debtors for Plan
Purposes Only ........................................................................................................24
C. Plan Funding Mechanism ......................................................................................25
D. Formation of the Liquidation Trust........................................................................25
E. Establishment of Reserves and Escrow Accounts .................................................25
F. Powers and Duties of the Liquidation Trustee .......................................................27
G. Appointment of the Liquidation Trustee................................................................29
H. Issuance of General Unsecured Creditor Interests .................................................29
I. Liquidation Trustee Reporting ...............................................................................29
J. Fees and Expenses of the Liquidation Trustee ......................................................30
K. Resignation or Removal of Liquidation Trustee ....................................................30
L. Reliance on Documents .........................................................................................30
M. Corporate Action ....................................................................................................30
N. Liquidation and Dissolution of Debtors .................................................................30
O. Dissolution of Creditors’ Committee .....................................................................31
P. Closing of the Bankruptcy Cases ...........................................................................31
Q. Plan Distributions...................................................................................................31
R. Preservation and Abandonment of Records ...........................................................31
S. General Disposition of Assets ................................................................................31
T. Final Administrative Expense Claims Bar Date ....................................................32
U. Deadline for Filing Applications for Professional Fee Claims ..............................32
V. Execution of Documents to Effectuate Plan ..........................................................33
W. Disallowance of Claims Without Further Order of the Court................................33
X. Post-Effective Date Reports and Fees....................................................................33
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Y. Cancellation of Notes, Instruments, Certificates, and Other
Documents .............................................................................................................33
Z. Insurance Preservation ...........................................................................................34
AA. Preservation of Causes of Action ...........................................................................34
BB. Section 1146 Exemption from Certain Taxes and Fees .........................................34
CC. Withdrawal of the Standing Motion ......................................................................34
DD. Settlement Pursuant to Bankruptcy Rule 9019 ......................................................35
EE. Return of Deposits .................................................................................................35
VI. TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES ..........35
VII. CONDITIONS PRECEDENT; CONFIRMATION AND EFFECTIVE DATE ...............35
A. Conditions Precedent to Plan Confirmation ..........................................................35
B. Conditions Precedent to the Effective Date ...........................................................36
C. Waiver of Conditions Precedent ............................................................................36
VIII. INJUNCTIONS; STAYS; RELEASE; EXCULPATIONS ...............................................36
A. General Injunctions ................................................................................................36
i. Injunctions Against Interference with Consummation or
Implementation of Plan ..............................................................................37
ii. Plan Injunction ...........................................................................................37
iii. No Bar To Claims Against Third Parties ...................................................37
B. All Distributions Received in Full and Final Satisfaction .....................................37
C. No Modification of Res Judicata Effect.................................................................37
D. Exculpation for Debtors, Committee, and Estate Professionals ............................37
E. Exculpation for Liquidation Trustee ......................................................................38
F. Releases by the Debtors .........................................................................................38
G. Releases by Releasing Parties ................................................................................39
IX. PROVISIONS GOVERNING DISTRIBUTIONS ............................................................40
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A. Payments in U.S. Dollars .......................................................................................40
B. Distributions Only on Business Days ....................................................................40
C. Unclaimed Distributions ........................................................................................40
D. Timing of Distributions Generally .........................................................................40
E. Timing of Distributions on Disputed Claims Subsequently
Allowed ..................................................................................................................41
F. No Payment or Distribution of Disputed Claims ...................................................41
G. Disputed Distribution .............................................................................................41
H. Transmittal of Payments and Notices ....................................................................41
I. Record Date for Distributions ................................................................................41
J. Claims Administration Responsibility ...................................................................42
K. Disputed Claims. ....................................................................................................42
L. No Payments of Fractional Cents or Distributions of Less Than
Thirty-Five Dollars ................................................................................................43
M. Setoff and Recoupment ..........................................................................................44
N. Payment of Taxes on Distributions Received Pursuant to the Plan .......................44
O. Compliance With Tax Withholding and Reporting Requirements ........................44
X. PLAN INTERPRETATION, CONFIRMATION, AND VOTING ..................................44
A. Procedures Regarding Objections to Designation of Classes as
Impaired or Unimpaired .........................................................................................44
B. Withdrawal and Modification of Plan....................................................................45
C. Governing Law ......................................................................................................45
D. Voting of Claims ....................................................................................................45
E. Acceptance by Impaired Class ...............................................................................45
F. Presumed Acceptances of Plan ..............................................................................45
G. Presumed Rejections of Plan .................................................................................45
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H. Cram Down ............................................................................................................45
XI. RETENTION OF JURISDICTION BY BANKRUPTCY COURT ..................................47
XII. CERTAIN TAX CONSEQUENCES OF THE PLAN ......................................................48
A. General ...................................................................................................................48
B. Tax Consequences of Payment of Allowed Claims Pursuant to
Plan Generally ........................................................................................................49
(i) Recognition of Gain or Loss ......................................................................49
(ii) Bad Debt or Worthless Security Deduction ...............................................49
XIII. CONFIRMATION OF PLAN – REQUIREMENTS ........................................................49
A. Absolute Priority Rule ...........................................................................................50
B. Best Interest of Creditors Test; Liquidation Analysis............................................50
XIV. PROCEDURES FOR VOTING ON PLAN ......................................................................51
XV. CONFIRMATION HEARING ..........................................................................................52
XVI. RECOMMENDATION .....................................................................................................53
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PLEASE READ THIS DISCLOSURE STATEMENT CAREFULLY. THIS
DISCLOSURE STATEMENT CONTAINS INFORMATION THAT MAY BEAR UPON
YOUR DECISION TO ACCEPT OR REJECT THE PLAN, WHICH IS ENCLOSED
WITH THIS DISCLOSURE STATEMENT. THE DEBTORS BELIEVE THAT THE
PLAN IS IN THE BEST INTERESTS OF THE DEBTORS AND THEIR CREDITORS
AND PROVIDES THE HIGHEST AND MOST EXPEDITIOUS RECOVERIES TO
HOLDERS OF ALLOWED CLAIMS AGAINST THE DEBTORS.
Agera Energy LLC and its debtor affiliates, as debtors and debtors in possession
(collectively, the “Debtors”), submit this disclosure statement (the “Disclosure Statement”)
pursuant to Bankruptcy Code section 1125 to accompany their Joint Chapter 11 Plan of
Liquidation of Agera Energy LLC, et al. dated April 1, 2020 (the “Plan”), which has been filed
with the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy
Court”). A copy of the Plan is annexed as Exhibit A hereto.
I. PURPOSES AND LIMITATIONS OF DISCLOSURE STATEMENT
A. Purpose of Disclosure Statement
The purpose of the Disclosure Statement is to set forth information that (i) summarizes
the Plan and alternatives to the Plan, (ii) advises holders of Claims and Interests of their rights
under the Plan, (iii) assists Creditors entitled to vote in making informed decisions as to whether
they should vote to accept or reject the Plan, and (iv) assists the Bankruptcy Court in determining
whether the Plan complies with the provisions of chapter 11 of the Bankruptcy Code and should
be confirmed.
You are urged to read the Disclosure Statement in order to determine what rights you
may have to vote on or object to the Plan and before making any decision on any such course of
action. Particular attention should be directed to the provisions of the Plan affecting or impairing
your rights as they existed before the institution of the Bankruptcy Cases. Please note, however,
that this Disclosure Statement cannot tell you everything about your rights. For instance, this
Disclosure Statement cannot and does not provide a complete description of the financial status
of the Debtors, all of the applicable provisions of the Bankruptcy Code, or other matters that may
be deemed significant by Creditors and other parties in interest. You are also encouraged to
consult with your lawyers and/or advisors as you review and consider the Disclosure Statement
and the Plan to enable you to obtain more specific advice on how the Plan will affect you.
B. Definitions and Exhibits
Definitions Unless otherwise defined herein, capitalized terms used in this Disclosure
Statement have the meanings ascribed to such terms in the Plan.
Exhibits The following exhibits are annexed hereto and expressly incorporated
herein:
Exhibit A: A copy of the Plan
Exhibit B: Liquidation Analysis
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C. Enclosures
The following materials are included with this Disclosure Statement:
1. A copy of the Plan and a copy of the Liquidation Analysis;
2. A copy of an order approving the Disclosure Statement (the “Disclosure Statement
Order”), which states: (a) the date by which objections to confirmation of the Plan
must be served and filed, (b) the date by which all votes with respect to the Plan must
be cast, (c) the date of the hearing in the Bankruptcy Court to consider confirmation
of the Plan, and (d) other relevant information;
3. A copy of the notice of the deadline for submitting ballots to accept or reject the Plan
and, among other things, the date, time and place of the hearing to consider
confirmation of the Plan and the deadline for filing objections to confirmation of the
Plan;
4. A ballot (and return envelope) for voting to accept or reject the Plan, unless you are
not entitled to vote because you are (i) to receive no Distribution under the Plan and
are deemed to reject the Plan or (ii) not impaired under the Plan and are deemed to
accept the Plan;
5. A notice of non-voting status if you are not impaired under the Plan and are deemed
to accept the Plan or if you are not receiving a Distribution under the Plan and are
deemed to reject the Plan, as applicable; and
6. Internal Revenue Service Form W-9, Request for Taxpayer Identification Number
and Certification.
D. Representations and Limitations
NO PERSON IS AUTHORIZED IN CONNECTION WITH THE PLAN OR THE
SOLICITATION OF VOTES THEREON TO GIVE ANY INFORMATION OR TO
MAKE ANY REPRESENTATION OTHER THAN AS CONTAINED IN THIS
DISCLOSURE STATEMENT AND THE EXHIBITS ANNEXED HERETO OR
INCORPORATED HEREIN BY REFERENCE OR REFERRED TO HEREIN AND, IF
GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MAY NOT BE
RELIED UPON AS HAVING BEEN AUTHORIZED BY THE DEBTORS.
NO REPRESENTATIONS CONCERNING THE DEBTORS OR THE PLAN ARE
AUTHORIZED OTHER THAN AS SET FORTH HEREIN. ANY REPRESENTATIONS
OR INDUCEMENTS TO SECURE YOUR ACCEPTANCE OF THE PLAN OTHER
THAN AS CONTAINED HEREIN SHOULD NOT BE RELIED UPON BY YOU.
THE INFORMATION CONTAINED HEREIN HAS BEEN PREPARED BY THE
DEBTORS IN GOOD FAITH, BASED UPON UNAUDITED INFORMATION
AVAILABLE TO THE DEBTORS AS OF THE DATE HEREOF. ALTHOUGH THE
DEBTORS HAVE USED THEIR BEST EFFORTS TO ENSURE THAT SUCH
INFORMATION IS ACCURATE, THE INFORMATION CONTAINED HEREIN IS
UNAUDITED. THE DEBTORS BELIEVE THAT THIS DISCLOSURE STATEMENT
COMPLIES WITH THE REQUIREMENTS OF THE BANKRUPTCY CODE.
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THE STATEMENTS CONTAINED IN THIS DISCLOSURE STATEMENT ARE
MADE AS OF THE DATE HEREOF, UNLESS ANOTHER TIME IS SPECIFIED
HEREIN, AND DELIVERY OF THIS DISCLOSURE STATEMENT SHALL NOT
CREATE ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE
FACTS SET FORTH HEREIN SINCE THE DATE OF THIS DISCLOSURE
STATEMENT AND/OR THE DATE THAT THE MATERIALS RELIED UPON IN
PREPARATION OF THIS DISCLOSURE STATEMENT WERE COMPILED.
THE DISCLOSURE STATEMENT MAY NOT BE RELIED ON FOR ANY
PURPOSE OTHER THAN TO DETERMINE HOW TO VOTE ON THE PLAN, AND
NOTHING CONTAINED HEREIN SHALL CONSTITUTE AN ADMISSION OF ANY
FACT OR LIABILITY BY ANY PARTY, OR BE ADMISSIBLE IN ANY PROCEEDING
INVOLVING THE DEBTORS OR ANY OTHER PARTIES, OR BE DEEMED
CONCLUSIVE ADVICE ON THE TAX OR OTHER LEGAL EFFECTS OF THE PLAN
ON HOLDERS OF CLAIMS AGAINST OR INTERESTS IN THE DEBTORS.
THE DESCRIPTION OF THE PLAN CONTAINED IN THIS DISCLOSURE
STATEMENT IS INTENDED AS A SUMMARY ONLY AND IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO THE PLAN ITSELF. EACH CREDITOR AND
HOLDER OF AN INTEREST IS ENCOURAGED TO READ, CONSIDER AND
CAREFULLY ANALYZE THE TERMS AND PROVISIONS OF THE PLAN.
THIS DISCLOSURE STATEMENT AND THE PLAN PROVIDE FOR
INJUNCTIVE RELIEF, EXCULPATIONS, AND RELEASES AS TO THE DEBTORS
AND CERTAIN OTHER PARTIES. THE PERMANENT INJUNCTIONS,
EXCULPATIONS, AND RELEASES SET FORTH IN THE PLAN WILL APPLY TO
HOLDERS OF ANY CLAIM, INTEREST, LIEN, ENCUMBRANCE OR DEBT,
WHETHER SECURED OR UNSECURED, GRANTED PRIORITY STATUS,
INCLUDING PRIORITY TAX (FEDERAL OR STATE), NON-PRIORITY UNSECURED
CLAIM OR ANY INTERESTS IN THE DEBTORS. CREDITORS AND HOLDERS OF
AN INTEREST WILL BE BOUND BY THE INJUNCTIVE RELIEF, EXCULPATIONS,
AND RELEASES UNLESS CREDITORS TIMELY FILE OBJECTIONS IN
ACCORDANCE WITH THE PROVISIONS SET FORTH IN THE DISCLOSURE
STATEMENT ORDER OR HEREIN AND APPEAR AT THE CONFIRMATION
HEARING TO PROSECUTE ANY OBJECTION.
E. Important Dates
The Bankruptcy Court approved this Disclosure Statement by and through the Disclosure
Statement Order entered on [_________], 2020 after notice and hearing and in accordance with
Bankruptcy Code section 1125. The Bankruptcy Court found that the information contained
herein is of the kind, and is sufficiently detailed, to enable a hypothetical, reasonable investor
typical of the class being solicited to make an informed judgment concerning the Plan.
HOWEVER, THE BANKRUPTCY COURT HAS NOT CONFIRMED THE PLAN, NOR
IS THIS DISCLOSURE STATEMENT OR THE DISCLOSURE STATEMENT ORDER
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TO BE CONSTRUED AS APPROVAL OR ENDORSEMENT OF THE PLAN BY THE
BANKRUPTCY COURT.
As stated in the Disclosure Statement Order, the Bankruptcy Court has scheduled a
hearing to consider Confirmation of the Plan for June 8, 2020 at 2:00 p.m. (the “Confirmation
Hearing”). Holders of Claims and Interests and other parties in interest may attend this hearing.
Objections to confirmation of the Plan must be filed on or before June 3, 2020, as set forth in the
Disclosure Statement Order.
All Ballots with respect to the Plan must be completed in full and signed to be counted in
the tabulation of the votes and must be received by Stretto (the “Voting Agent”) no later than
4:00 p.m. on June 3, 2020 (the “Voting Deadline”).
Completed Ballots must be signed, dated and returned with an original signature
promptly either:
(a) Via E-Ballot:
You may access the E-Ballot Platform on the Voting Agent’s website by visiting
http://cases.stretto.com/agera, clicking on the “E-Ballot” link and following the
instructions set forth on the website, and submitting your consent and vote.
(b) Via Mail, Personal Delivery, or Overnight Courier:
Agera Balloting
c/o Stretto, 8269
E. 23rd Ave., Ste. 275
Denver, CO 80238
F. Solicitation Procedures
Creditors holding Claims that are impaired have the right to vote to accept or reject the
Plan. Generally speaking, a Claim or Interest is impaired if the Plan alters the legal, contractual,
or equitable rights of the holder of the Claim or Interest. A Class of Creditors accepts the Plan
when Creditors holding at least two-thirds in amount of such class and more than one-half in
number of the Claims in such class who actually cast their ballots vote to accept the Plan.
In the Bankruptcy Cases, the Plan contains five (5) Classes of Claims and one (1) Class
of Interests. The Plan provides that holders of Class 1B, 2, 3, and 4 Claims are impaired in that
the Plan alters the legal, contractual, or equitable rights of the holders of such Claims. Holders
of Class 5 Interests receive no Distribution under the Plan on account of their Claims and
Interests in the Debtors and are therefore deemed to reject the Plan. Accordingly, votes on the
Plan will be solicited only from Classes 1B, 2, 3, and 4.
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G. Recommendation
In the Debtors’ opinion, the treatment of Creditors and interest holders under the Plan
contemplates a greater recovery than that which is likely to be achieved under any other
alternative for the liquidation of the Debtors’ assets under chapter 11 or chapter 7 of the
Bankruptcy Code.
Accordingly, the Debtors submit that confirmation of the Plan is in the best interests of the
Debtors’ Creditors and holders of Interests and recommend that all holders of Claims entitled to
vote on the Plan vote to accept the Plan.
H. Inquiries
If you have any questions about the packet of materials that you have received, please
contact the Voting Agent, Stretto, by telephone at (877) 273-7276 during normal business hours.
II. BACKGROUND
A. Nature of the Debtors’ Business
Headquartered in Briarcliff Manor, New York, the Debtors provided retail electricity and
natural gas to commercial, industrial, and residential customers. The Debtors offered their
customers “energy choice”—the ability to receive electricity and natural gas commodity needs
from a source other than the local utility in certain markets that have been restructured to permit
retail competition, which allows customers to tailor energy supply to their specific needs. Across
both electricity and natural gas supply, the Debtors, as of October 4, 2019 (the “Petition Date”),
serviced 87 distinct utility regions and provided service to approximately 35,000 customers,
comprised of over 75,000 accounts in California, Connecticut, Delaware, District of Columbia,
Illinois, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Ohio,
Pennsylvania, Rhode Island, Texas, and Virginia.
B. Organizational Structure
Debtor Agera Holdings LLC (“Agera Holdings”), a Delaware limited liability company,
is a holding company with no business operations. Debtor Utility Recovery LLC is a Delaware
limited liability company that is a dormant entity with no operations, assets, or liabilities and is
wholly-owned by Agera Holdings. Debtor Agera Solutions LLC (“Solutions”) is a Delaware
limited liability company that is a dormant entity with no operations, assets, or liabilities and is
wholly-owned by Agera Holdings. Debtor Agera Energy LLC (“Agera Energy”) is a Delaware
limited liability company that, as of the Petition Date, was an operating entity that maintained
contracts with customers in several states for the supply of natural gas and/or electricity and is
wholly-owned by Agera Holdings. Debtor energy.me midwest llc (“EME”) is an Illinois limited
liability company that, as of the Petition Date, was an operating entity that maintained contracts
with customers in several states for the supply of electricity and is wholly-owned by Agera
Energy. Debtor Aequitas Energy Inc. (“Aequitas”) is a Connecticut corporation that, as of the
Petition Date, was an operating entity that maintained contracts with customers in Connecticut
for the supply of electricity and is wholly owned by Agera Energy. Non-debtor Briarcliff
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Property Group, LLC (“Briarcliff”) is a New York limited liability company wholly-owned by
Agera Energy that owns and manages the real property used for the Debtors’ headquarters.
Agera Energy was the “Designated Buyer” under an asset purchase agreement between
Platinum Partners Arbitrage Fund L.P. (“PPVA”) and Glacial Energy Holdings (“Glacial”) in
PPVA’s June 2014 acquisition of substantially all of Glacial’s assets in Glacial’s voluntary
chapter 11 bankruptcy case. After the acquisition of Glacial, and upon information and belief,
Agera Energy issued an amended and restated convertible promissory note in the amount of
$600,071.23 (the “Convertible Note”) to Principal Growth Strategies (“PGS”). PPVA and a
Platinum-operated entity indirectly became the holders of the Convertible Note through their
ownership interest in PGS. The Convertible Note was convertible into 95.01% of the
outstanding capital securities of Agera Holdings. Upon information and belief, on June 9, 2016,
the Convertible Note was sold to AGH Parent LLC (“AGH Parent”), which exercised its
conversion right in April 2018 and, as a result, now owns 95.01% of the voting membership
interests in Agera Holdings. Upon information and belief, Greg E. Lindberg (“Lindberg”) owns
50% of the total economic interest and 89% of the total voting interest in AGH Parent. Upon
information and belief, Lindberg is also the beneficial holder of equity interests in approximately
100 independent operating companies, including the Debtors, through Lindberg-owned Eli
Global LLC (“Eli Global”). In March 2020, Lindberg was convicted of committing certain acts
wholly unrelated to the Debtors. Upon information and belief, Lindberg has had no involvement
with the Debtors’ day-to-day operations.
C. Prepetition Capital Structure
1. Preferred Supplier Agreement
Agera Energy, EME, and Aequitas (collectively, the “Agera Opco Entities”) and BP
Energy Company (“BP”) are parties to (i) that certain Preferred Supplier Agreement, dated
October 2, 2015 (as amended on May 15, 2017 and February 9, 2018, the “Senior Lien Supply
Agreement”) and (ii) that certain ISDA Master Agreement, dated May 5, 2015 (as amended on
October 2, 2015, and together with all related confirmations, schedules, annexes, exhibits and
addenda thereto, the “Senior Lien ISDA Master Agreement”). Pursuant to the Senior Lien
Supply Agreement and Senior Lien ISDA Master Agreement, BP supplied electricity and natural
gas to the Agera Opco Entities and engaged in hedging transactions with the Agera Opco
Entities.
Pursuant to that certain Pledge and Security Agreement, dated October 2, 2015, between
Agera Energy and Agera Holdings, as Pledgors, and BP, as Secured Party, (i) Agera Energy
pledged substantially all of its assets to BP as collateral security for Agera Energy’s obligations
to BP under the Senior Lien Supply Agreement and Senior Lien ISDA Master Agreement, and
(ii) Agera Holdings pledged its membership interests in Agera Energy to BP as collateral
security for Agera Energy’s obligations to BP under the Senior Lien Supply Agreement and
Senior Lien ISDA Master Agreement. Pursuant to that certain Pledge and Security Agreement,
dated October 2, 2015, between Aequitas and Agera Energy, as Pledgors, and BP, as Secured
Party, (i) Aequitas pledged substantially all of its assets to BP as collateral security for Aequitas’
obligations to BP under the Senior Lien Supply Agreement and Senior Lien ISDA Master
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Agreement, and (ii) Agera Energy pledged its membership interests in Aequitas to BP as
collateral security for Aequitas’ obligations to BP under the Senior Lien Supply Agreement and
Senior Lien ISDA Master Agreement. Pursuant to that certain Pledge and Security Agreement,
dated October 2, 2015, between EME and Agera Energy, as Pledgors, and BP, as Secured Party,
(i) EME pledged substantially all of its assets to BP as collateral security for EME’s obligations
to BP under the Senior Lien Supply Agreement and Senior Lien ISDA Master Agreement, and
(ii) Agera Energy pledged its equity interests in EME to BP as collateral security for EME’s
obligations to BP under the Senior Lien Supply Agreement and Senior Lien ISDA Master
Agreement.
Pursuant to that certain Personal Guaranty, dated November 20, 2018 (the “Original
Lindberg Guaranty”), between Lindberg and BP, Lindberg guaranteed the obligations of the
Agera Opco Entities2 and Agera Holdings under the Senior Lien Supply Agreement and the
Forbearance Agreement (as defined below), subject to an aggregate maximum liability of
$51,000,000 (subject to certain potential adjustments).
Pursuant to that certain Guaranty Agreement, dated November 20, 2018 (the “Original
GHTG Guaranty” and, together with the Original Lindberg Guaranty, the “Original Guaranties”),
between Global Health Technology Group, LLC (“GHTG”) and BP, GHTG guaranteed the
obligations of the Agera Opco Entities3 and Agera Holdings under the Senior Lien Supply
Agreement and the Forbearance Agreement, subject to an aggregate maximum liability of
$51,000,000 (subject to certain potential adjustments. Upon information and belief, Lindberg is
the beneficial holder of equity interests in GHTG. Upon information and belief, in connection
with the amendment to the Forbearance Agreement (as discussed below), the Original Guaranties
were terminated and replacement guaranties (the “Replacement Guaranties”) were executed in
January 2019, in substantially the same form as the Original Guaranties. As of the Petition Date,
the Debtors estimated that approximately $161.6 million was outstanding under the Senior Lien
Supply Agreement and Senior Lien ISDA Master Agreement.
2. Second Lien Revolving Credit Facility
Agera Energy and Colorado Bankers Life Insurance Company (“Colorado”), as Lender
and Agent, are parties to that certain Junior Loan and Security Agreement, dated February 15,
2018 (the “Revolving Credit Agreement”), pursuant to which Colorado agreed to make available
to Agera Energy a revolving credit line in the maximum principal amount of $35,000,000.
Agera Energy pledged substantially all of its assets to Colorado as collateral security for Agera
Energy’s obligations to Colorado under the Revolving Credit Agreement. Pursuant to that
certain Second Amended and Restated Intercreditor Agreement, dated February 9, 2018, between
BP, Agera Holdings, the Agera Opco Entities, and certain Subordinate Lienholders (as defined
therein), the security interests granted to Colorado are subordinate in priority to the security
2 Aequitas Energy, Inc. is an “Agera Opco Entity” as defined herein. However, Aequitas Energy LLC (not Aequitas
Energy, Inc.) is named as a guarantor in the Original Lindberg Guaranty.
3 Aequitas Energy, Inc. is an “Agera Opco Entity” as defined herein. However, Aequitas Energy LLC (not Aequitas
Energy, Inc.) is named as a guarantor in the Original GHTG Guaranty.
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interests granted to BP. Colorado alleges that, as of the Petition Date, $35,000,000 in principal
was outstanding under the Revolving Credit Facility.
3. Unsecured Debt
The Debtors estimate that, as of the Petition Date, approximately $82 million of general
unsecured debt was outstanding, comprised primarily of trade claims, obligations related to REC
and ACP obligations (each as defined and discussed below), and broker commission payments.
D. Circumstances Leading to Filing
1. Legacy Issues from Prior Management
The retail energy business is, by its nature, a very competitive, low-margin business. The
Debtors’ senior management, who joined the Debtors approximately one year prior to the
Petition Date, uncovered a number of structural challenges within the Debtors’ business. The
Debtors grew their business significantly in the 18-month period from January 2017 through
June 2018, primarily from selling and onboarding customers on fixed price power contracts,
which are inherently riskier than variable price contracts. The size of the Debtors’ power
business, as measured by annualized volumes on flow, more than doubled during this time.
Upon arrival, the new senior management team uncovered a number of challenges,
including: (a) poor (and in some cases no) visibility into forward margins and, consequently,
poor overall financial planning and forecasting; (b) a significant number of customer contracts at
very low and negative forward margins (uncovered after developing visibility into forward
margins); (c) a suboptimal control environment (financial, pricing, risk management, etc.); and
(d) an overstated balance sheet. Upon discovering these issues, management developed, and
presented in late September 2018, a number of Strategic options for Eli Global to assess, ranging
from a bankruptcy filing to a turnaround plan.
Eli Global ultimately committed to a turnaround plan, with full recognition of the capital
necessary to fund the plan. The Debtors’ business was not expected to be profitable until 2020
given that it was straddled with the run-off of low- and negative-margin customer contracts. The
Debtors were executing the turnaround plan up until the unexpected capital liquidity problems
discussed below.
2. The Prepetition Defaults
In September 2018, the Debtors’ current management identified material balance sheet
issues, which led to a restatement of the Debtors’ financials. Specifically, as of August 31, 2018,
there was approximately $39 million of over stated receivables, of which $37 million related to
unbilled receivables. As a result of the foregoing discovery, the Debtors suddenly found
themselves in breach of the Senior Lien Supply Agreement’s $16 million Tangible Net Worth
covenant. After further discussions with various constituents, BP, the Agera Opco Entities, and
Agera Holdings executed that certain Forbearance Agreement and Limited Waiver, dated
November 20, 2018 (the “Forbearance Agreement”), pursuant to which (i) the Agera Opco
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Entities and Agera Holdings acknowledged that they had breached their covenant in the Senior
Lien Supply Agreement to maintain a Tangible Net Worth (as defined in the Senior Lien Supply
Agreement) of at least $16 million, (ii) BP agreed to forbear from enforcing remedies under the
Senior Lien Supply Agreement as a result of such breach, and (iii) Agera Holdings agreed to
make additional capital contributions to Agera Energy of at least $51 million on the following
schedule:
Capital Contribution Contribution Date
$5,000,000 December 14, 2018
$15,000,000 January 4, 2019
$10,000,000 February 1, 2019
$15,000,000 June 20, 2019
$6,000,000 September 20, 2019
Eli Global played a significant role in the discussions leading up to the Forbearance
Agreement. Specifically, Eli Global intended to provide the funding to Agera Holdings necessary
to satisfy the capital contributions contemplated under the Forbearance Agreement. The $5
million capital contribution due on December 14, 2018 was satisfied on December 14, 2018. The
$15 million capital contribution due on January 4, 2019 was not satisfied. However, a $5 million
capital contribution was made on January 18, 2019. On January 25, 2019, BP, the Agera Opco
Entities, and Agera Holdings executed that certain First Amendment to Forbearance Agreement
and Limited Waiver, dated November 20, 2018, pursuant to which: (i) the Agera Opco Entities
and Agera Holdings acknowledged that they were in breach of the Forbearance Agreement due
to Agera Holdings’ failure to fully fund the capital contribution payment due on January 4, 2019,
and (ii) Agera Holdings agreed to the following revised forward capital contribution schedule:
Capital Contribution Contribution Date
$5,000,000 January 18, 2019
$5,000,000 January 31, 2019
$10,000,000 February 18, 2019
$5,000,000 April 18, 2019
$15,000,000 June 20, 2019
$6,000,000 September 20, 2019
The $5 million capital contribution due on January 31, 2019 was satisfied on January 31,
2019. The $10 million capital contribution due on February 18, 2019 was satisfied on February
19, 2019. The $5 million capital contribution due on April 18, 2019 was not satisfied. On April
22, 2019, BP noticed the Agera Opco Entities and Agera Holdings of their default under the
Forbearance Agreement. On April 23, 2019, BP noticed the Agera Opco Entities and Agera
Holdings of their failure to remit approximately $43 million due to BP under the Senior Lien
Supply Agreement, due on April 22, 2019, for power delivered in March 2019, under the Senior
Lien Supply Agreement. On April 26, 2019, BP noticed the Agera Opco Entities and Agera
Holdings of their failure to remit approximately $3.5 million due to BP, due on April 25, 2019,
for gas delivered in March 2019, under the Senior Lien Supply Agreement. On April 29, 2019, a
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$5 million capital contribution was made in satisfaction of the payment that was due on April 18,
2019.
Upon information and belief, all of the foregoing capital contributions were made to
Agera Holdings by Eli Global. On September 25, 2019, BP noticed the Agera Opco Entities of
their breaches under the Senior Lien Supply Agreement and Senior Lien ISDA Master
Agreement, for failing to timely remit payment for power and gas invoices in the amount of
$103,022,968.20, under the Senior Lien Supply Agreement and Senior Lien ISDA Master
Agreement.
3. Loss of Funding from Eli Global
On May 9, 2019, during a triparty meeting between the Debtors, Eli Global, and BP, it
became clear that Eli Global was no longer in a position to inject the requisite capital needed to
support the Debtors’ business.
4. RPS Requirements and Defaults
In certain states where the Debtors operated, the Debtors were required to satisfy
renewable portfolio standards (“RPS”) as a condition of their license or certification to supply
energy to customers in such states. RPS laws require a certain portion of a state’s electricity
consumption to be generated from renewable sources, such as wind, solar, biomass, geothermal,
or hydroelectric. Energy suppliers that are required to comply with certain RPS requirements,
such as the Debtors, must obtain a sufficient amount of renewable energy credits (often called
renewable energy certificates or “RECs”) during regular reporting cycles (e.g., annually) with
each state. RECs are created when renewable energy is generated and delivered to the grid.
Those renewable energy producers may then use the RECs to satisfy their own RPS requirements
or sell the RECs they generate to other energy suppliers, such as the Debtors. If a supplier does
not comply with RPS requirements, the supplier may retain its license or certification to supply
energy by paying an alternative compliance payment (“ACP”) in lieu of acquiring RECs. In
nearly all instances, the ACP will be more costly than had the energy supplier acquired the
necessary RECs. Ultimately, an energy supplier’s failure to satisfy these requirements may
result in the relevant state taking regulatory enforcement action, including suspension and
revocation of the supplier’s license to supply energy in such state.
May and June of 2019 were very critical months because the Debtors were scheduled to
pay for and take delivery of a significant number of RECs to satisfy RPS requirements for the
2018 compliance year. Without additional capital contributions from Eli Global, the Debtors
were forced to default on a number of REC trades, and thus were unable to satisfy certain RPS
requirements. As of the Petition Date, the Debtors were in default of their 2018 RPS
requirements in Massachusetts, New Hampshire, and Rhode Island as a result of the Debtors’
financial inability to acquire RECs or subsequently make ACP payments. The Debtors estimate
that their inability to satisfy RPS requirements in the normal course resulted in an aggregate ACP
“premium” of approximately 60%, as compared to the cost of acquiring the RECs necessary to
avoid ACP obligations. The Debtors estimate that as of the Petition Date, they had not paid
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more than $72 million on account of REC and ACP requirements for the 2018 compliance year.
Although certain states have filed claims related to these requirements, the Debtors contest any
assertion that RPS requirements give rise to valid claims against the Debtors.
5. Pre-Petition Marketing Process
As a result of the Debtors’ severe liquidity constraints and contemplated regulatory
enforcement action, including potential suspension or revocation of the Debtors’ license to sell
electricity or natural gas in certain states, the Debtors began pursuing strategic alternatives. In
May 2019, the Debtors engaged Stifel, Nicolaus & Co., Inc. and Miller Buckfire & Co., LLC
(collectively, “Miller Buckfire”) as investment banker to explore strategic alternatives, including
conducting a marketing process for the sale of the Debtors, as either a going concern or an asset
sale. In connection with this process, Miller Buckfire prepared marketing materials, including a
Confidential Information Memorandum (the “CIM”) and compiled a list of potentially interested
parties. Miller Buckfire contacted 207 parties, comprised of 121 strategic investors and 86
financial investors. Each party was provided with a teaser document and was invited to execute
a confidentiality agreement (“NDA”) with the Debtors in order to receive the CIM and access to
a virtual data room. Of the 207 parties contacted, 39 executed an NDA and received the CIM
and process letter. Twenty of those 39 parties expressed interest in further participating in the
process and were provided access to a virtual data room. Throughout this period, Miller
Buckfire facilitated these parties’ due diligence efforts. In June 2019, the Debtors received
numerous preliminary, non-binding indications of interest (each, an “IOI”). Following receipt of
the IOIs, the Debtors and their advisors continued to facilitate parties’ due diligence, including
management meetings and providing additional diligence information. Following these meetings,
the Debtors and their advisors continued negotiations with the interested parties regarding their
proposals and key terms, including timing and transaction structure.
In late July 2019, the Debtors and their advisors provided certain interested parties with a
draft asset purchase agreement (the “APA”) and second round process letter, with a deadline to
provide a binding bid and marked-up APA by August 5, 2019. On October 3, 2019, the Debtors
and Exelon Generation Company, LLC (“Exelon”) executed that certain Asset Purchase
Agreement, pursuant to which Exelon will serve as the stalking horse bidder to acquire a
significant portion of the Debtors’ customer contracts for $24,750,000.00, subject to certain
adjustments, under Bankruptcy Code sections 363 and 365 (the “Stalking Horse APA”).
E. Potential Estate Causes of Action
In addition to the causes of action Agera Energy asserted in the Adversary Proceeding
against Sunwave (as defined and described below), the Debtors may have been victims of
wrongdoing by various other individuals and parties.
F. The Bankruptcy Cases
On the Petition Date, the Debtors filed voluntary petitions for relief under chapter 11 of
the Bankruptcy Code. The Debtors continue to operate their businesses and manage their
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properties as debtors in possession pursuant to Bankruptcy Code sections 1107(a) and 1108. No
request for the appointment of a trustee or examiner has been made in the Bankruptcy Cases.
III. SIGNIFICANT EVENTS DURING THE CHAPTER 11 CASE
A. First Day Pleadings
To facilitate the commencement of the Bankruptcy Cases and minimize disruption to the
Debtors’ operations, the Debtors filed certain motions and applications with the Bankruptcy
Court on the Petition Date seeking certain relief, as summarized below. The relief sought in the
“first day” pleadings facilitated the Debtors’ transition into chapter 11 and aided in the
preservation of the Debtors’ going-concern value.
i. Taxes Motion
The Debtors believed that, in some cases, certain taxing, regulatory, and governmental
authorities had the ability to exercise rights and remedies if the Debtors failed to remit certain
taxes and fees. Accordingly, the Debtors filed the Debtors’ Motion for Entry of an Interim and
Final Order (I) Authorizing, but not Directing, the Payment of Certain Prepetition Taxes and
Fees and (II) Granting Related Relief [Docket No. 7]. The Bankruptcy Court granted the relief
requested on an interim basis on October 8, 2019 [Docket No. 56] and on a final basis on
November 7, 2019 [Docket No. 202].
ii. Wage Motion
To minimize the personal hardships the Debtors’ employees would have suffered if
prepetition employment-related obligations were not paid when due or as expected, as well as to
maintain morale during the critical time of the beginning stages of the Bankruptcy Cases, the
Debtors filed the Debtors’ Motion for Entry of Interim and Final Orders Authorizing Payment
of Certain Prepetition Wages, Reimbursable Expenses, Benefits, and Related Items [Docket No.
8]. The Bankruptcy Court granted the relief requested on an interim basis on October 8, 2019
[Docket No. 51] and on a final basis on November 7, 2019 [Docket No. 201].
iii. Cash Management Motion
The Debtors used a centralized cash management system comprised of nineteen Debtor
bank accounts to collect funds from, and to pay expenses incurred by, their operations. As such
system was integral to the operation of the Debtors’ business, the Debtors filed the Debtors’
Motion for Entry of Interim and Final Orders Authorizing Debtors to Continue (I) to Operate
Their Cash Management System, Honor Certain Prepetition Obligations Related Thereto, and
Maintain Existing Business Forms; and (II) Their Intercompany Transactions [Docket No. 9].
The Bankruptcy Court granted the relief requested on an interim basis on October 8, 2019
[Docket No. 52] and on a final basis on November 15, 2019 [Docket No. 225].
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iv. Motion to Pay
The Debtors identified a limited list of service providers that provided the Debtors with
natural gas, electricity, transmission, distribution and related services, all of which were critical
to the Debtors’ business operations. The Debtors therefore filed the Debtors’ Motion for Entry
of Interim and Final Orders Authorizing the Debtors to (I) Pay Certain Prepetition Claims of
Service Providers and (II) Continue Satisfying Postpetition Obligations in the Ordinary Course
of Business [Docket No. 12]. The Bankruptcy Court granted the relief requested on an interim
basis on October 8, 2019 [Docket No. 55] and on a final basis on November 7, 2019 [Docket No.
200].
v. Procedural and Administrative Orders
To facilitate a smooth and efficient administration of the Bankruptcy Cases and reduce
the administrative burdens associated therewith, on October 8, 2019, the Bankruptcy Court also
entered procedural and administrative orders, including the: (a) Order Directing Joint
Administration of Related Chapter 11 Cases [Docket No. 49]; (b) Order (I) Authorizing the
Debtors to (A) File a Consolidated List of Creditors, (B) File a Consolidated List of the Debtors’
Thirty Largest Unsecured Creditors, and (II) Authorizing Debtors to Establish Procedures for
Notifying Parties of the Commencement of These Cases [Docket. No. 53]; and (c) Order (I)
Extending Debtors’ Time to File Schedules of Assets and Liabilities, Schedules of Current
Income and Expenditures, Schedules of Executory Contracts and Unexpired Leases, and
Statements of Financial Affairs and (II) Authorizing Debtors to File Consolidating Monthly
Operating Reports [Docket No. 54] (the “Order Extending Time to File Schedules”). In
addition, on October 17, 2019, the Bankruptcy Court entered the Order (A) Establishing Certain
Notice, Case Management, and Administrative Procedures and (B) Granting Related Relief
[Docket No. 96].
B. Other Significant Pleadings
i. Insurance Motion
As of the Petition Date, the Debtors were covered by 12 insurance policies that were
provided and/or administered by multiple third-party insurance carriers and that were essential to
the preservation of the value of the Debtors’ business, properties, and other assets. The Debtors
therefore filed the Debtors’ Motion for Entry of an Order (I) Authorizing the Debtors to (A) Pay
their Obligations Under Prepetition Insurance Policies, (B) Continue to Pay Certain Brokerage
Fees, (C) Renew, Supplement, Modify, or Purchase Insurance Coverage in the Ordinary Course,
and (D) Honor Their Prepetition Insurance Premium Financing Agreements; (II) Authorizing
Banks and Other Financial Institutions to Honor Checks and Electronic Transfer Requests
Related Thereto; and (III) Granting Related Relief [Docket No. 14]. The Bankruptcy Court
granted the relief requested on November 17, 2019 [Docket No. 203].
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ii. Ordinary Course Professionals Motion
As of the Petition Date, the Debtors routinely employed various attorneys to represent
them in various matters arising in the ordinary course of business, unrelated to the Bankruptcy
Cases. Because such attorneys (each an “Ordinary-Course Professional”) provided critical
services necessary for the Debtors to comply with legal and regulatory requirements and operate
their business soundly and efficiently, the Debtors filed the Debtors’ Motion for Entry of an
Order Authorizing Debtors to Employ and Pay Professionals Utilized in the Ordinary Course of
Business [Docket No. 18], seeking authorization to (a) retain and employ Ordinary-Course
Professionals without approval of separate, formal retention applications for each Ordinary-
Course Professional and (b) pay 100% of the interim fees and disbursements to each Ordinary-
Course Professional upon the submission to the Debtors of an invoice, not to exceed: (i)
$100,000 per month on average over any three-month period on a rolling basis for each
Ordinary-Course Professional (the “Monthly Fee Cap”); and (ii) $600,000 in the aggregate from
the Petition Date through confirmation of a plan for each Ordinary-Course Professional (the
“Case Cap”). On November 7, the Court issued its Order Authorizing the Debtors to Employ
and Pay Professionals Utilized in the Ordinary Course of Business [Docket No. 206], which
granted the Debtors the relief requested, except that the Monthly Fee Cap was set at $50,000, and
the Case Cap was set at $250,000.
C. Postpetition Financing and Use of Cash Collateral
On October 8, 2019, upon motion of the Debtors, the Bankruptcy Court entered the
Interim Order (I) Authorizing Use of Cash Collateral, (B) Granting Adequate Protection, (II)(A)
Approving Postpetition Supply Facility, (B) Granting Liens and Providing Superpriority
Administrative Expense Claims, and (III) Modifying the Automatic Stay [Docket No. 47] (the
“Interim DIP Order”). On November 12, 2019, the Bankruptcy Court entered a Final Order (I)
Authorizing Use of Cash Collateral, (B) Granting Adequate Protection, (II)(A) Approving
Postpetition Supply Facility, (B) Granting Liens and Providing Superpriority Administrative
Expense Claims, and (III) Modifying the Automatic Stay [Docket No. 221] (the “Final DIP
Order”). The Interim DIP Order and Final DIP Order authorized the Debtors’ use of cash
collateral and entry into postpetition financing.
D. Key Employee Retention Plan and Key Employee Incentive Plan
On October 11, 2019, the Debtors filed the Debtors’ Motion for Entry of An Order
Approving (I) Key Employee Incentive Plan and (II) Key Employee Retention Plan [Docket No.
69], seeking entry of an order authorizing the Debtors’ (i) key employee retention plan for 30 key
employees and providing for payments up to an aggregate amount of $1,149,902.00; and (ii) key
employee incentive plan term sheet for two members of the Debtors’ senior management and
providing for payments up to an aggregate amount of $700,000.00. On November 7, 2019, the
Bankruptcy Court entered the Order Approving Debtors’ Key Employee Retention Program
[Docket No. 207]. On December 17, 2019, the Bankruptcy Court entered the Order Approving
Debtors’ Modified Key Employee Incentive Plan Term Sheet [Docket No. 323].
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E. The Appointment of the Committee
On October 11, 2019, the United States Trustee for the Southern District of New York
(the “U.S. Trustee”) appointed an official committee of unsecured creditors pursuant to
Bankruptcy Code section 1102 (the “Committee”) [Docket No. 61].
F. Retention of Professionals; Appointment of Claims and Noticing Agent
On October 9, 2019, the Bankruptcy Court entered an order authorizing the Debtors to
retain Stretto as claims and noticing agent nunc pro tunc to the Petition Date [Docket No. 50].
On December 3, 2019, the Bankruptcy Court entered an order authorizing the Debtors to
retain GlassRatner, LLC as financial advisor nunc pro tunc to the Petition Date [Docket No.
270].
Also on December 3, 2019, the Bankruptcy Court entered an order authorizing the
Committee to retain Kilpatrick Townsend & Stockton LLP as counsel nunc pro tunc to October
11, 2019 [Docket No. 271].
On December 16, 2019, the Bankruptcy Court entered an order authorizing the Debtors to
retain Miller Buckfire & Co., LLC and Stifel Nicolaus & Co., Inc. as investment banker nunc
pro tunc to the Petition Date [Docket No. 318].
Also on December 16, 2019, the Bankruptcy Court entered an order authorizing the
Debtors to retain McDermott Will & Emery LLP as bankruptcy counsel nunc pro tunc to the
Petition Date [Docket No. 319].
Also on December 16, 2019, the Bankruptcy Court entered an order authorizing the
Committee to retain Dundon Advisers LLC as financial advisor nunc pro tunc to October 11,
2019 [Docket No. 320].
On December 17, 2019, the Bankruptcy Court entered an order authorizing the Debtors to
retain Stretto as administrative advisor to the Debtors nunc pro tunc to the Petition Date [Docket
No. 324].
G. Schedules of Assets and Liabilities, Statements of Financial Affairs
On November 6, 2019, the Debtors filed their schedules of assets and liabilities and
statements of financial affairs in each of their respective cases (collectively, the “Schedules”)4
pursuant to the Order Extending Time to File Schedules. On December 10, 2019, the Debtors
filed amended Schedules in each of their respective cases.
4 The Schedules filed on November 6, 2019 were restricted from public view to comply with privacy guidelines, and
updated versions of the Schedules, accessible to the public, were filed on November 18, 2019.
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H. Bar Date for Filing of Claims Arising Prior to the Petition Date
On November 7, 2019, the Bankruptcy Court entered an order [Docket No. 199] (the
“Bar Date Order”): (i) setting a deadline (the “Bar Date”) for filing proofs of claim against the
Debtors and their Estates pursuant to Federal Rule of Bankruptcy Procedure 3003(c)(3); (ii)
approving the form of notice of the Bar Date (the “Bar Date Notice”) to be sent to Creditors and
parties in interest; (iii) setting a deadline (the “Administrative Expense Bar Date”) for filing
applications or motions seeking approval of Administrative Expense Claims against the Debtors
and their Estates; (iv) approving the form of notice of the Administrative Expense Bar Date (the
“Administrative Expense Bar Date Notice”) to be sent to Creditors and parties in interest; and (v)
approving as adequate and sufficient the service of the Bar Date Notice by first class mail and
publication of the Bar Date in the national edition of USA Today or a similar publication. The
Bar Date Order fixed December 23, 2019 at 5:00 p.m., or with respect to Governmental Units,
April 1, 2020 at 5:00 p.m., as the Bar Date by which all Claims against the Debtors, other than
those types of Claims specifically excepted, had to be filed. The Bar Date Order also fixed
December 23, 2019 at 5:00 p.m. as the Administrative Expense Bar Date by which all
Administrative Expense Claims against the Debtors that first began to accrue prior to November
15, 2019 had to be filed for all persons and entities (including, without limitation, individuals,
partnerships, corporations, joint ventures, trusts, and governmental units).
The Bar Date Notice and Administrative Bar Date Notice were served by first class
regular mail upon (a) the U.S. Trustee; (b) counsel for the Committee; (c) all persons or entities
that requested notice of the proceedings in the Bankruptcy Cases; (d) all known creditors of the
Debtors, including as set forth on the Schedules and those that filed claims; (e) all parties to
executory contracts and unexpired leases of the Debtors; and (f) the Internal Revenue Service, all
state and local taxing authorities, and all applicable Governmental Units. Notice of the Bar Date
and Administrative Expense Bar Date was also published in USA Today on November 21, 2019.
Except for the holders of certain specifically excluded Claims, every Creditor was required to
file a proof of Claim on or before the Bar Date so that the Debtors could ascertain with certainty
the total amount of pre-petition Claims outstanding.
In accordance with Federal Rule of Bankruptcy Procedure 3003(c)(2), holders of Claims
who failed to comply with the terms of the Bar Date Order are forever barred from (i) filing a
proof of Claim with respect to such Claim, (ii) asserting such Claims against the Debtors or their
Estates and/or property, (iii) filing applications or motions seeking approval of Administrative
Expense Claims (iv) voting on any plan filed in the Bankruptcy Cases, and (iv) participating in
any Distribution in the Bankruptcy Cases on account of such Claims.
I. Sale of the Agera Opco Entities’ Assets
On the Petition Date, the Debtors filed their Motion for Entry of Orders (I)(A) Approving
Bidding Procedures Relating to the Sale of the Debtors’ Assets, (B) Approving Stalking Horse
Asset Purchase Agreement and Bid Protections, (C) Approving Form and Manner of Notices of
Sale, Auction and Sale Hearing, (D) Approving Procedures Relating to the Assumption and
Assignment of Certain Executory Contracts, (E) Scheduling Auction for, and Hearing to
Approve, Sale of the Agera Opco Entities’ Assets; (II)(A) Approving the Sale of the Agera Opco
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Entities’ Assets Free and Clear of All Liens, Claims, Interests and Encumbrances and (B)
Authorizing the Assumption and Assignment of Certain Executory Contracts; and (III) Granting
Related Relief [Docket No. 16] (the “Sale Motion”) seeking, among other things: (i) approval of
the bidding procedures (the “Bidding Procedures”) set forth in the Sale Motion for the sale of
substantially all assets of the Debtors (the “Purchased Assets”) free and clear of all liens, claims,
encumbrances, obligations, liabilities, contractual commitments, or interests of any kind or
nature whatsoever (the “Sale”); (ii) approval of the Stalking Horse APA with Exelon Generation
Company, LLC (the “Stalking Horse Bidder”) and certain protections for the Stalking Horse
Bidder; (iii) approval of the procedures related to the assumption and assignment of executory
contracts (iv) preliminary approval of the notice to each relevant non-Debtor contract
counterparty to an executory contract regarding the Debtors’ potential assumption and
assignment of such contract and the amount necessary to cure any defaults thereunder; (v)
approval of the form and manner of notices of the Sale, auction (the “Auction”), and sale hearing
(the “Sale Hearing”); (vi) scheduling the Auction and the Sale Hearing; and (vii) granting related
relief.
An interim hearing with respect to the Sale Motion (the “Interim Hearing”) was held on
October 18, 2019. After the Debtors filed a revised proposed order, which addressed the
Committee’s objection to the Sale Motion, the Court on October 22, 2019 entered the Order
(I)(A) Approving Bidding Procedures Relating to the Sale of the Debtors’ Assets, (B) Approving
Stalking Horse Asset Purchase Agreement and Bid Protections, (C) Approving Form and
Manner of Notices of Sale, Auction and Sale Hearing, (D) Approving Procedures Relating to the
Assumption and Assignment of Certain Executory Contracts, (E) Scheduling Auction for, and
Hearing to Approve, Sale of the Agera Opco Entities’ Assets and (II) Granting Related Relief
[Docket No. 116] (the “Bidding Procedures Order”), which, among other things, approved the
Bidding Procedures and set the Auction for November 4, 2019 and the Sale Hearing for
November 5, 2019.
On November 2, 2019, the Debtors filed a Notice of Cancellation of Auction because the
Debtors did not receive any Qualified Bids (as defined in the Bidding Procedures Order) other
than that of the Stalking Horse Bidder. On November 5, 2019, the Court held the Sale Hearing,
and on November 7, 2019, the Court entered the Order (I) Authorizing and Approving the Sale of
Substantially All of the Agera Opco Entities’ Assets Free and Clear of Liens, Claims,
Encumbrances, and Other Interests; (II) Approving the Assumption and Assignment of Certain
Executory Contracts and Unexpired Leases Related Thereto; and (C) Granting Related Relief
[Docket No. 197] (the “Sale Order”), which approved the Sale of the Purchased Assets and
assignment of a significant portion of the Debtors’ customer contracts (the “Assigned
Contracts”) to the Stalking Horse Bidder pursuant to Bankruptcy Code sections 363 and 365.
The Sale closed on November 20, 2019.
Pursuant to the Sale, the Assigned Contracts were transferred to the Stalking Horse
Bidder during the period from November 20, 2019 through March 19, 2020 for those customers
who did not otherwise unilaterally choose to switch to a different service provider. All
customers whose contracts did not constitute Assigned Contracts were either transferred to
different service providers or returned to utility service prior to March 31, 2020, with only a few
exceptions whose transfers will be effective in April, 2020. The final purchase price pursuant to
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the Sale is expected to be approximately $17.75 million. There are currently no claims
submitted by the Stalking Horse Bidder for indemnification under the Sale documents, but such
claims may be made through June 17, 2020, and, if made, could result in a reduction of the
purchase price to be paid to Debtors.
J. Challenge Period Extensions/Standing Motion
Pursuant to the Final DIP Order, the Committee requested and received five extensions of
the time to challenge certain stipulations and releases in the Final DIP Order (the “BP
Stipulations”).
On March 13, 2020, the Committee filed its Motion of the Official Committee of
Unsecured Creditors for Order Granting (I) Leave, Standing, and Authority to Commence
Prosecute Certain Claims on Behalf of the Debtors’ Estates Against BP Energy Company and
(II) Related Relief [Docket No. 518] (the “Standing Motion”), thereby tolling the Committee’s
time to bring an action challenging the BP Stipulations. In the Standing Motion, the Committee
seeks standing to assert causes of action against BP on behalf of the Debtors’ estates, including:
(i) claims for avoidance of preferential transfers made by the Debtors to BP in the form of BP’s
security interests that attached to $24 million worth of collateral that the Debtors posted with
four independent service operators on or about September 26, 2019, September 28, 2019, and
October 1, 2019; (ii) claims for the turnover of or avoidance and recovery of transfers of
approximately $67 million of estate property that the Debtors paid to BP in contravention of
paragraph 9 of the Final DIP Order; (iii) an objection under Bankruptcy Code section 502(a) to
16,698,538.95$ in minimum volume fees and Post-PSA fees asserted as part of BP’s prepetition
secured claim; (iv) an objection under Bankruptcy Code section 502(d) to the entirety of BP’s
prepetition claim; and (v) an objection to the 506(c) surcharge waiver provided under the Final
DIP Order due to BP’s failure to fund post-petition alternative compliance payments to the extent
they owed by the Debtors (collectively, the “Committee Causes of Action”). A hearing on the
Standing Motion is presently scheduled for April 21, 2020.
K. Plan Support Agreement
Over several months, BP and the Committee have engaged in lengthy discussions to
resolve the Committee Causes of Action. The Debtors understand that BP and the Committee
have reached a tentative resolution to the Committee Causes of Action. The Debtors expect that
BP, the Committee, and the Debtors will file a plan support agreement that will memorialize the
settlement terms reached by BP and the Committee (the “Plan Support Agreement”). The
Debtors anticipate that the Plan Support Agreement will provide that BP, the Committee, and the
Debtors will support the Plan, resolve the Committee Causes of Action, and provide for
withdrawal of the Standing Motion upon the Effective Date.
L. Massachusetts DOER Administrative Expense Claim
On December 20, 2019, the Massachusetts Department of Energy Resources (the “MA
DOER”) filed its Application for Administrative Expenses of the Massachusetts Department of
Energy Resources (the “Application”) [ECF No. 422], seeking allowance and payment of an
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administrative expense claim in the amount of $2,699,982 (the “MA DOER Admin Claim”)
related to ACPs allegedly owed for due to energy provided by the Debtors to customers in
Massachusetts between October 4, 2019 and November 15, 2019. On March 20, 2020, the
Committee objected to MA DOER Admin Claim, asserting, among other things, that the ACPs
forming the basis of the MA DOER Admin Claim do not give rise to a claim against the Debtors.
The Debtors intend to object to the MA DOER Admin Claim as well. A hearing on the MA
DOER Admin Claim has been set for April 21, 2020.5
M. Sunwave Adversary Proceeding
On November 8, 2019, Agera Energy commenced an adversary proceeding against
Sunwave USA Holdings, Inc. (“Sunwave”) asserting claims related to Sunwave’s breach of a
non-solicitation clause (the “Non-Solicitation Clause”) in a non-disclosure agreement to which
Agera Energy and Sunwave are parties (Adv. Proc. No. 19-08554 (RDD)) (the “Adversary
Proceeding”). Agera Energy’s complaint in the Adversary Proceeding asserted that Sunwave
breached the Non-Solicitation Clause by soliciting and/or hiring four former Agera employees in
breach of the Non-Solicitation Clause and contains claims for breach of contract, breach of the
covenant of good faith and fair dealing, injunctive relief, and tortious interference with current
and prospective business relations. Also on November 8, 2019, Agera Energy filed the Debtor’s
Emergency Motion for a Temporary Restraining Order, Preliminary Injunction, and Expedited
Discovery [Adv. Docket No. 2] (the “TRO Motion”). On November 21, 2019, the Court entered
the Stipulation and Order Resolving Debtor’s Emergency Motion for a Temporary Restraining
Order, Preliminary Injunction, and Expedited Discovery [Docket No. 10], which resolved the
TRO Motion and pursuant to which Sunwave agreed to abide by the terms of the Non-
Solicitation Clause through the pendency of the Adversary Proceeding. On December 30, 2019,
Sunwave filed a motion to dismiss the Adversary Proceeding [Docket No. 12]. On February 24,
2020, the Court entered the Stipulation and Order of Dismissal [Docket No. 25], which
dismissed the Adversary Proceeding without prejudice, with each party to bear such party’s own
costs and fees associated with the Adversary Proceeding, and pursuant to which Sunwave agreed
to abide by the terms of the Non-Solicitation Clause through June 17, 2020.
IV. SUMMARY OF THE PLAN OF LIQUIDATION
A. General Plan Objectives
Chapter 11 is the chapter of the Bankruptcy Code primarily used for business
reorganization. Asset sales, stock sales, and other liquidation efforts, however, can also be
conducted during a chapter 11 case or pursuant to a chapter 11 plan. Under chapter 11, a
company endeavors to restructure its finances such that it maximizes recovery to its creditors.
Formulation and confirmation of a chapter 11 plan is the primary goal of a debtor in a
chapter 11 case. A chapter 11 plan sets forth and governs the treatment and rights to be afforded
5 For similar reasons, the Committee has also objected to proofs of claim filed by the MA DOER and the
Massachusetts Department of Environmental Protection, both of which assert claims due to the Debtors’ failure to
pay ACPs.
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to creditors and shareholders with respect to their claims against and equity interests in the
debtor. Under Bankruptcy Code section 1125, acceptances of a chapter 11 plan may be solicited
by the proponent of a plan only after a written disclosure statement has been provided to each
creditor or shareholder entitled to vote on the plan.
The Plan is a plan of liquidation. In general, a chapter 11 plan of liquidation (i) divides
claims and equity interests into separate classes, (ii) specifies the property that each class is to
receive under the plan, and (iii) contains other provisions necessary to implement the Plan.
Generally, the Plan establishes a mechanism by which assets of the Estates will be
distributed to holders of Claims and Interests, in the order set forth in the Plan.
B. Provisions Governing Order and Method for Distributions Under the Plan
The Plan divides Claims against and Interests in the Debtors into six (6) categories or
“Classes” according to the underlying basis and subsequent treatment for each. Claims within
the same Class are treated identically. The Plan is premised on the substantive consolidation of
the Debtors with respect to the voting and treatment of all Claims and Interests, as provided
below.
DIP Financing Claims, Administrative Expense Claims, Professional Fee Claims, Priority
Tax Claims, Non-Tax Priority Claims, and Intercompany Claims are not classified but are treated
in the manner set forth in Article 2 of the Plan and summarized below.
C. Classes of Claims
The following classes of Claims and Interests are designated pursuant to and in
accordance with Bankruptcy Code section 1123(a)(1), which Classes shall be mutually
exclusive:
Class Class Description Estimated
Amount of
Allowed Claims
Impairment Estimated
Recovery
Class 1A Allowed Other
Secured Claims
$1,000,000 –
$1,100,000
Unimpaired.
Deemed to
Accept.
100%
Class 1B Allowed Prepetition
BP Secured Claim
$[130,270,000] Impaired.
Entitled to
Vote.
78% – 85%
Class 2 Allowed General
Unsecured Claims
$21,700,000 –
$161,000,000
Impaired.
Entitled to
Vote.
1% – 16%
Class 3 Allowed BP
Deficiency Claim
and Allowed BP
Subordinated Claim
$36,609,959 –
$44,983,645
Impaired.
Entitled to
Vote.
0%
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Class 4 Allowed Prepetition
CBLIC Claims
$35,699,288 –
$36,761,160
Impaired.
Entitled to
Vote.
0%
Class 5 Interests N/A Impaired.
Deemed to
Reject.
N/A
i. DIP Financing Claims
The DIP Financing Claims are Allowed in full. All Allowed DIP Financing Claims shall
be paid in full, in Cash on the Effective Date or as soon thereafter as reasonably practicable.
ii. Administrative Expense Claims
All Allowed Administrative Expense Claims shall be paid in full, in Cash in such
amounts as may be Allowed by the Bankruptcy Court (a) as soon as practicable following the
later of the Effective Date or the date upon which the Court enters a Final Order allowing any
such Administrative Expense Claim, (b) as otherwise provided in the Bankruptcy Code or
approved by the Bankruptcy Court, or (c) as agreed by the holder of any such Administrative
Expense Claim. If any Disputed Administrative Expense Claim exists on the Effective Date,
then the Liquidation Trustee shall hold and maintain Cash in the Disputed Confirmation Reserve
in an amount equal to all outstanding Disputed Administrative Expense Claims until such dispute
is resolved consensually or by Final Order.
iii. Professional Fee Claims
All Allowed Professional Fee Claims shall be paid in full, in Cash in such amounts as may be
Allowed by the Bankruptcy Court (a) as soon as practicable following the later of the Effective
Date or the date upon which the Court enters a Final Order allowing any such Professional Fee
Claim, (b) as otherwise provided in the Bankruptcy Code or approved by the Bankruptcy Court,
or (c) as may be agreed upon between the holder of any such Professional Fee Claim and the
Debtors. If any Disputed Professional Fee Claim exists on the Effective Date, then the
Liquidation Trustee shall hold and maintain Cash in the Professional Fee Escrow Account in an
amount equal to all outstanding Disputed Professional Fee Claims until such dispute is resolved
consensually or by Final Order.
iv. Priority Tax Claims
Unless otherwise agreed to by the parties, each holder of an Allowed Priority Tax Claim
will receive Cash of a total value, as of the Effective Date, equal to the Allowed amount of such
Priority Tax Claim either (a) in full on the Effective Date, or (b) in regular installment payments
over a period ending not later than five (5) years after the Petition Date, which treatment is not
less favorable than that provided to the General Unsecured Creditors, in accordance with
Bankruptcy Code section 1129(a)(9)(C); provided, however, that all Allowed Priority Tax
Claims that are not due and payable on or before the Effective Date shall be paid in the ordinary
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course of business in accordance with the terms thereof. If any Disputed Priority Tax Claim
exists on the Distribution Date, then the Liquidation Trustee shall hold and maintain Cash in the
Disputed Confirmation Reserve in an amount equal to all outstanding Disputed Priority Tax
Claims until such dispute is resolved consensually or by Final Order.
v. Non-Tax Priority Claims
Each holder of an Allowed Non-Tax Priority Claim will receive Cash on the Effective
Date of a total value, as of the Effective Date, equal to the full Allowed amount of such Non-Tax
Priority Claim; provided, however, that all Allowed Non-Tax Priority Claims that are not due
and payable on or before the Effective Date shall be paid in the ordinary course of business in
accordance with the terms thereof. If any Disputed Non-Tax Priority Claim exists on the
Distribution Date, then the Liquidation Trustee shall hold and maintain Cash in the Disputed
Confirmation Reserve in an amount equal to all outstanding Disputed Non-Tax Priority Claims
until such dispute is resolved consensually or by Final Order.
vi. Intercompany Claims
As a result of substantive consolidation of the Debtors for distribution purposes
under the Plan, as provided in the Plan, holders of Intercompany Claims will not receive any
Distribution of property under the Plan on account of their Intercompany Claims and, on the
Effective Date, the Intercompany Claims will be cancelled.
vii. Class 1A (Allowed Other Secured Claims)
Each holder of an Allowed Other Secured Claim shall receive on the Effective Date
(except to the extent that a holder of an Allowed Other Secured Claim agrees to less favorable
treatment): (i) Cash in an amount equal to such Other Secured Claim; (ii) return of the collateral
securing such Other Secured Claim; (iii) such other treatment that will render such Other
Secured Claim unimpaired under Bankruptcy Code section 1124; or (iv) such other treatment as
the Debtors and the applicable holder of an Allowed Other Secured Claim may agree. Any
Deficiency Claim that may arise on account of the present lack of collateral or otherwise
resulting from the aforesaid treatment shall be included in and treated as a Class 2 Allowed
General Unsecured Claim. For the avoidance of doubt, the Subordinate Lienholders and their
successors will not have Allowed Claims and their liens, if any, shall be released.
viii. Class 1B (Allowed Prepetition BP Secured Claim)
Each holder of an Allowed Prepetition BP Secured Claim shall receive on the Effective
Date, or as soon as reasonably practicable thereafter, all of the following, but not including cash
in an amount necessary to pay or reserve for the Confirmation Amount: the return of proceeds
from the sale of the Prepetition Collateral and any Prepetition Collateral, including, among other
things, the Posted Collateral, subject to Other Secured Claims. BP shall be deemed to (i) waive
any diminution Claim against the Debtors and their Estates under the Final DIP Order, and (ii)
release any lien it holds on (a) Briarcliff that is evidenced by a mortgage or otherwise, as well as
any lien on the Briarcliff Membership Interests, and (b) the Liquidation Trust Assets.
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The aggregate Allowed amount of the Prepetition BP Secured Claim shall be the sum of
(i) [$ ]130,270,019.91 and (ii) the amount of any draws on Posted Collateral pursuant to the
Prepetition BP Secured Loan Documents, minus (y) any Adequate Protection Cash Payments (as
defined in the Final DIP Order) applied to the Prepetition BP Secured Claim prior to the
Effective Date, and (z) any collections on Guaranties net of the Guarantee Proceeds (defined
herein) paid to the Liquidation Trust.
In no event shall BP receive Distributions under the Plan that exceed the aggregate
Allowed amount of the Prepetition BP Secured Claim unless holders of General Unsecured
Claims have been paid in full. If BP receives Distributions under the Plan that exceed the
Allowed amount of the Prepetition BP Secured Claim before holders of General Unsecured
Claims are paid in full, BP shall remit any such excess amount to the Liquidation Trust, and such
amounts shall constitute Liquidation Trust Assets. In addition, if holders of Prepetition CBLIC
Claims receive Distributions under the Plan that are paid to BP pursuant to an intercreditor
agreement before holders of General Unsecured Claims are paid in full, then BP shall pay such
Distributions to the Liquidation Trust and such amounts shall constitute Liquidation Trust Assets
(the “CBLIC Intercreditor Proceeds”).
BP shall diligently pursue and attempt to collect on the Guaranties. BP shall provide
regular status updates to the Liquidation Trustee with respect to the pursuit and collection of the
Guaranties. Each time BP receives proceeds on account of the Guaranties (the “Guarantee
Proceeds”), BP shall pay, without recoupment or offset, 10% of the Guarantee Proceeds, net of
any expenses incurred in the collection thereof, to the Liquidation Trust no later than fourteen
(14) days after BP’s receipt of such Guarantee Proceeds. The amount of Guarantee Proceeds
transferred by BP to the Liquidation Trust shall constitute Liquidation Trust Assets and shall not
exceed $3 million.
ix. Class 2 (Allowed General Unsecured Claims)
Each holder of an Allowed General Unsecured Claim shall receive one or more
Distributions equal to its Pro Rata share of the General Unsecured Creditor Interests as such
Distributions become available as is reasonably practicable in the reasonable discretion of the
Liquidation Trustee. The Liquidation Trust, in the Liquidation Trustee’s discretion, shall make
periodic Distributions of available Cash from the Liquidation Trust Assets to the holders of
General Unsecured Creditor Interests at any time after the Effective Date.
x. Class 3 (Allowed BP Deficiency Claim and Allowed BP Subordinated Claim)
Subject to the section of the Plan related to the treatment of Prepetition CBLIC Claims,
outlined below, (i) the BP Deficiency Claim and the BP Subordinated Claim shall be deemed
Allowed and subordinated to Class 2 Allowed General Unsecured Claims, and (ii) after all
Allowed General Unsecured Claims are paid in full, each holder of an Allowed BP Deficiency
Claim and Allowed BP Subordinated Claim shall receive its Pro Rata share of the proceeds of
the Subordinated Creditor Fund as such funds become available as is reasonably practicable in
the reasonable discretion of the Liquidation Trustee.
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xi. Class 4 (Prepetition CBLIC Claims)
Upon the consent of the holder(s) of the Prepetition CBLIC Claims, such Prepetition
CBLIC Claims shall be deemed subordinated to the Class 2 General Unsecured Claims pursuant
to Bankruptcy Code section 510(c) or recharacterized as equity, and any liens purportedly
securing such Claims shall be released on the Effective Date. Absent the consent of the holder(s)
of the Prepetition CLBIC Claims and if the Prepetition CBLIC Claims are not subordinated or
recharacterized as equity as of the Effective Date and ultimately become Allowed Claims, such
Claims shall be deemed General Unsecured Claims and shall be treated in accordance with the
Plan to the extent that such General Unsecured Claims become Allowed General Unsecured
Claims; provided, however, that pursuant to Bankruptcy Code 510(a) and that certain Second
Amended and Restated Intercreditor Agreement by and among BP, CBLIC, the Subordinate
Lienholders, and certain of the Debtors, dated February 9, 2018, any Allowed Prepetition CBLIC
Claims are contractually subordinated to the Prepetition BP Secured Claim and the BP
Subordinated Claim and shall not receive any distributions on account of such claims until the
BP Deficiency Claim and the Allowed BP Subordinated Claim have been paid in full.
xii. Class 5 (Interests)
No holder of an Interest shall be entitled to a Distribution under the Plan on account of
such Interest. On the Effective Date, all Interests shall be retired, cancelled, extinguished, and/or
discharged.
V. MEANS OF IMPLEMENTING THE PLAN
A. Joint Chapter 11 Plan
The Plan is a joint chapter 11 plan for each Debtors, with the Plan for each Debtor being
non-severable and mutually dependent on the Plan for each Debtor.
B. Substantive Consolidation of Claims Against Debtors for Plan Purposes Only
The Plan is premised on the substantive consolidation of all of the Debtors with respect to
the treatment of all Claims and Interests. The Plan shall serve as a request by the Debtors, in lieu
of a separate motion, to the Bankruptcy Court that it grant substantive consolidation with respect
to the treatment of all Claims and Interests as follows. On the Effective Date, (a) all Assets and
liabilities of the Debtors will, solely for voting and Distribution purposes, be merged or treated
as though they were merged; (b) all guarantees of the Debtors of the obligations of any other
Debtor and any joint or several liability of any of the Debtors shall be eliminated; (c) each and
every Claim or Interest against any Debtor shall be deemed a single Claim against, and a single
obligation of, the Debtors and all Claims filed against more than one Debtor for the same
liability shall be deemed one Claim against any obligation of the Debtors; and (d) all transfers,
disbursements, and Distributions on account of Claims made by or on behalf of any of the
Debtors’ Estates hereunder will be deemed to be made by or on behalf of all of the Debtors’
Estates. Holders of Allowed Claims entitled to Distributions under the Plan shall be entitled to
their share of Assets available for Distribution to such Claim without regard to which Debtor was
originally liable for such Claim. Except as set forth in the Plan, such limited substantive
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consolidation shall not (other than for purposes related to the Plan) affect the legal and corporate
structures of the Debtors.
C. Plan Funding Mechanism
The Plan shall be funded from the Effective Date Cash and any other Assets of the
Estates, except as expressly set forth herein.
D. Formation of the Liquidation Trust
On the Effective Date, the Liquidation Trust shall be formed pursuant to the Plan and
established and become effective in accordance with the Liquidation Trust Agreement to
liquidate the Liquidation Trust Assets, the Prepetition Collateral, and the Postpetition Collateral,
and to enable the Liquidation Trustee to distribute same in accordance with the Plan and the
Liquidation Trust Agreement. The Liquidation Trust shall be established for the sole purpose of
liquidating and distributing the Liquidation Trust Assets, the Prepetition Collateral, and the
Postpetition Collateral in accordance with Treasury Regulation section 301.7701-4(d), with no
objective to continue or engage in the conduct of a trade or business. On the Effective Date, the
Debtors shall transfer all of the Liquidation Trust Assets, the Prepetition Collateral, and the
Postpetition Collateral to the Liquidation Trust, subject only to the liens of Secured Creditors (as
may be modified in the Plan), and otherwise free and clear of liens, Claims, and Interests. On or
before the Effective Date, the Liquidation Trust Agreement shall be executed and, upon the
Effective Date, shall become effective without further action by any party.
The terms of the Liquidation Trust Agreement shall control as to all matters applicable to
the Liquidation Trust. To the extent there is any conflict between the Liquidation Trust
Agreement and the Plan, the Plan shall govern.
E. Establishment of Reserves and Escrow Accounts
(a) At least three (3) days prior to the Confirmation Hearing, the Debtors shall
file with the Bankruptcy Court a notice that reflects the proposed amounts of the Confirmation
Fund.
(b) Confirmation Fund. On the Effective Date, or as soon thereafter as is
practicable, the Liquidation Trustee shall establish the Confirmation Fund, which shall be funded
from the Effective Date Cash in an amount equal to the Confirmation Amount. The
Confirmation Fund shall be used to pay all Allowed Administrative Expense Claims, Allowed
Other Secured Claims, Allowed Priority Tax Claims, and Allowed Non-Tax Priority Claims.
Any amounts remaining in the Confirmation Fund, excluding the Initial Liquidation Trust
Funding and the GUC Budget Excess, after: (i) all Allowed Administrative Expense Claims,
Allowed Professional Fee Claims, Allowed Other Secured Claims, Allowed Priority Tax Claims,
and Allowed Non-Tax Priority Claims are satisfied in full; and (ii) the Disputed Confirmation
Reserve, the Professional Fee Escrow Account, the Disputed GUC Fund, and the Liquidation
Trust Expense Fund have been funded, shall become available for Distribution to the holder of
the Prepetition BP Secured Claim.
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(c) Disputed Confirmation Reserve. As soon as practicable after the Effective
Date, the Liquidation Trustee shall establish the Disputed Confirmation Reserve, which shall be
funded on each Distribution Date from the Effective Date Cash in an amount equal to the
Distributions that would have been made to holders of Disputed Administrative Expense Claims,
Disputed Other Secured Claims, Disputed Priority Tax Claims, and Disputed Non-Tax Priority
Claims if such Claims were Allowed Claims in their full amounts or such lower amount as to
which the holder of such Claim has agreed in writing or, in the case where any such Claim is
unliquidated and/or contingent, the greater of (i) $1, and (ii) such other amount as is reserved by
order of the Bankruptcy Court made upon motion of the holder of such Claim. The Liquidation
Trustee shall remove funds from the Disputed Confirmation Reserve as Disputed Administrative
Expense Claims, Disputed Other Secured Claims, Disputed Priority Tax Claims, and Disputed
Non-Tax Priority Claims are resolved, which funds shall be distributed as provided in the Plan,
and any excess shall be returned to BP.
(d) Professional Fee Escrow Account. On the Effective Date, the Liquidation
Trustee shall establish a Professional Fee Escrow Account and shall fund such Professional Fee
Escrow Account with Effective Date Cash in an amount equal to the sum of the Professional Fee
Claims. The Professional Fee Escrow Account shall be maintained in trust for the Professionals.
Such funds shall not be considered property of the Debtors’ Estates and shall not vest with the
Liquidation Trustee or the Liquidation Trust. Any amounts remaining in the Professional Fee
Escrow Account after all Allowed Professional Fee Claims are paid shall become available for
Distribution to holders of Prepetition BP Secured Claim.
(e) Disputed GUC Fund. As soon as practicable after the Effective Date, the
Liquidation Trustee shall establish the Disputed GUC Fund, which shall be funded on each
Distribution Date from the Liquidation Trust Assets in an amount equal to the Distributions that
would have been made to holders of Disputed General Unsecured Claims if such Claims were
Allowed Claims or such lower amount as to which the holder of such Claim has agreed in
writing or, in the case where any such Claim is unliquidated and/or contingent, the greater of (i)
$1, and (ii) such other amount as is reserved by order of the Bankruptcy Court made upon
motion of the holder of such Claim. The Liquidation Trustee shall remove funds from the
Disputed GUC Fund as Disputed General Unsecured Claims are resolved, which funds shall be
distributed as provided in the Plan.
(f) Liquidation Trust Expense Fund. On the Effective Date, or as soon
thereafter as is practicable, the Liquidation Trustee shall establish the Liquidation Trust Expense
Fund, the funding of which may include any Liquidation Trust assets; provided, however, that
the Liquidation Trust Expense Fund may not include more than $750,000 of the Initial
Liquidation Trust Funding. The Liquidation Trust Expense Fund shall be used to pay the
Liquidation Trust Expenses in accordance with the Liquidation Trust Agreement, including,
without limitation, costs and expenses of (i) counsel or other advisors retained by the Liquidation
Trustee, (ii) any liquidation or administration of the Liquidation Trust Assets, and (iii) the
prosecution of Causes of Action and Claims objections. Any amounts remaining in the
Liquidation Trust Expense Fund after all Liquidation Trust Expenses are paid shall become
available for Distribution to holders of Allowed General Unsecured Claims, the Allowed BP
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Deficiency Claim, the Allowed BP Subordinated Claim, and any Allowed Prepetition CBLIC
Claims in the priority of payment provided for in accordance with the provisions of the Plan.
(g) Subordinated Creditor Fund. On the date upon which all unsubordinated
Allowed General Unsecured Claims have been satisfied in full, or as soon thereafter as is
reasonably practicable, the Liquidation Trustee shall establish the Subordinated Creditor Fund,
which shall be funded by the Liquidation Trust after satisfaction in full of all Allowed General
Unsecured Claims in accordance with the Plan. The Subordinated Creditor Fund shall be used to
pay the Allowed BP Deficiency Claim and the Allowed BP Subordinated Claim, in the priority
of payment provided for in accordance with the provisions of the Plan.
F. Powers and Duties of the Liquidation Trustee
As of the Effective Date, the Liquidation Trustee shall be appointed under Bankruptcy
Code section 1123(b)(3)(B) and shall serve in such capacity and shall have comparable authority
as a bankruptcy trustee of the Debtors as the exclusive representative of the Estates or any
corresponding provision of federal or state laws and shall succeed to all of the Debtors’ and
Estates’ rights. The powers, rights, and responsibilities of the Liquidation Trustee, all of which
shall arise upon the occurrence of the Effective Date, shall be specified in the Liquidation Trust
Agreement and shall include, but not be limited to:
(a) collecting and liquidating the Liquidation Trust Assets under the
jurisdiction of the Bankruptcy Court;
(b) using commercially reasonable efforts to obtain the return of the
Prepetition Collateral to BP;
(c) asserting, prosecuting, objecting to, pursuing, compromising, and settling
in accordance with the Liquidation Trustee’s reasonable business judgment, all matters affecting
the Estates, including, without limitation, Disputed Claims and/or other Causes of Action related
thereto, to the extent set forth in the Liquidation Trust Agreement and except as provided therein,
without further order of the Bankruptcy Court;
(d) asserting and enforcing all legal or equitable remedies and defenses
belonging to the Debtors or their Estates, including, without limitation, setoff, recoupment, and
any rights under Bankruptcy Code section 502(d);
(e) acting on behalf of the Debtors in all adversary proceedings and contested
matters then pending or that can be commenced in the Bankruptcy Court and in all actions and
proceedings pending or commenced elsewhere, and to settle, retain, enforce, dispute, or adjust
any Claim and otherwise pursue actions involving the Assets of the Debtors that could arise or be
asserted at any time under the Bankruptcy Code, unless otherwise waived, relinquished, or
transferred in the Plan;
(f) taking such actions the Liquidation Trustee deems appropriate in his or her
reasonable business judgment against any Person with respect to a Claim or Cause of Action and
commencing any process or proceeding in the Bankruptcy Court or in any court of competent
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jurisdiction in accordance with applicable laws, to the extent set forth in the Liquidation Trust
Agreement;
(g) making Distributions to holders of all Allowed Claims, including
Professional Fee Claims, in accordance with the Plan and Liquidation Trust Agreement;
(h) proceeding with and employing all discovery devices permitted under
applicable law, including Rule 2004 of the Bankruptcy Rules, in order to investigate any Claims
or Causes of Action;
(i) employing, without further order of the Bankruptcy Court, professionals
or other Persons to assist it in carrying out its duties hereunder and under the Liquidation Trust
Agreement, and compensating and reimbursing the expenses of those professionals and other
Persons on the terms to be agreed to by the Liquidation Trustee and such professionals and other
Persons without further order of the Bankruptcy Court, to the extent set forth in the Liquidation
Trust Agreement;
(j) investing Cash in accordance with Bankruptcy Code section 345,
withdrawing and making Distributions of Cash to holders of Allowed Claims and paying taxes
and other obligations owed by the Debtors or incurred by the Liquidation Trustee from the
Liquidation Trust Expense Fund in accordance with the Plan;
(k) coordinating the turnover of property, if any, subject to rejected executory
contracts or abandonment or liquidation of any retained Assets and disposing of, and delivering
title to others of, or otherwise realizing value of, all the remaining Assets;
(l) overseeing compliance with the Debtors’ accounting, finance, and
reporting obligations and the filing of final tax returns, refund requests, audits, and other
corporate dissolution documents, if required;
(m) preparing financial statements and U.S. Trustee post-confirmation
quarterly reports, until such time such time as the Bankruptcy Court enters an order (i)
dismissing the Bankruptcy Cases, (ii) converting the Bankruptcy Cases to a case under chapter 7
of the Bankruptcy Code, or (iii) approving a final decree closing the Bankruptcy Cases;
(n) paying all other expenses for winding down the affairs of the Debtors in
accordance with a wind down budget or as otherwise agreed to by the Liquidation Trustee, and
in the event of a dispute that cannot be resolved, resolving such dispute in the Bankruptcy Court,
subject to the terms of the Plan;
(o) executing and delivering all documents, and taking all actions, necessary
to consummate the Plan, implement the Liquidation Trust Agreement, and wind down the
Debtors’ business;
(p) implementing and/or enforcing all provisions of the Plan;
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(q) asserting and/or waiving, as the Liquidation Trustee deems appropriate,
any attorney-client privilege or similar privilege belonging to any of the Debtors immediately
prior to the Effective Date of the Plan; and
(r) such other powers as may be vested in or assumed by the Liquidation
Trustee pursuant to the Liquidation Trust Agreement, Plan, other Bankruptcy Court order, or as
may be needed or appropriate to carry out the provisions of the Plan and Liquidation Trust
Agreement.
G. Appointment of the Liquidation Trustee
The Liquidation Trustee shall be deemed the Estates’ sole representative in accordance
with Bankruptcy Code section 1123 and shall have all powers, authority, and responsibilities
specified in the Plan including, without limitation, the powers of a trustee under Bankruptcy
Code sections 704 and 1106.
H. Issuance of General Unsecured Creditor Interests
(a) General Unsecured Creditor Interests. On the Effective Date or as soon as
practicable thereafter, the Debtors shall deliver to the Liquidation Trustee a list of each Person to
receive General Unsecured Creditor Interests as of the Effective Date pursuant to the Plan,
including the Allowed amounts of the Claims of, and the address of, each such Person.
(b) Transfer of General Unsecured Creditor Interests. The Liquidation Trustee
shall maintain a register of the holders of General Unsecured Creditor Interests and shall adjust,
without further order of the Bankruptcy Court, the register from time to time as General
Unsecured Claims that are Disputed Claims become Allowed. To the extent permitted in the
Liquidation Trust Agreement, upon notice to the Liquidation Trustee by any holder of a General
Unsecured Creditor Interest, the Liquidation Trustee shall amend the register to reflect any
transfer of a General Unsecured Creditor Interest by such holder to a transferee as set forth in the
notice; provided, however, that the Liquidation Trustee need not reflect any transfer (or
make any distribution to any transferee) and will give notice to such holder that no transfer
has been recognized in the event the Liquidation Trustee reasonably believes that such
transfer (or the distribution to such transferee) may constitute a violation of applicable
laws or might cause the Liquidation Trust to be required to register the General Unsecured
Creditor Interests, or to become a reporting company, under the Securities Exchange Act
of 1934, as amended.
I. Liquidation Trustee Reporting
The Liquidation Trustee shall prepare and file with the Court, and serve upon BP and the
U.S. Trustee, such reports as are required under the Plan, including quarterly reports, beginning
with the first full calendar quarter after the Effective Date, regarding the liquidation or other
administration of the Assets of the Estates, Distributions made by the Liquidation Trustee, and
the status of the prosecution or settlement of any Claims and Causes of Action. The Liquidation
Trustee shall pay fees of the U.S. Trustee as provided in the Plan.
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J. Fees and Expenses of the Liquidation Trustee
Except as otherwise ordered by the Bankruptcy Court or specifically provided for in the
Plan, the amount of Liquidation Trust Expenses and any compensation and expense
reimbursement Claims (including, without limitation, reasonable fees and expenses of counsel)
of the Liquidation Trustee arising out of the liquidation of the Assets of the Estates, the making
of Distributions under the Plan, and the performance of any other duties given to it shall be paid
from the Liquidation Trust Expense Fund and in accordance with the Liquidation Trust
Agreement; provided, however, that any fees or expenses (including legal) incurred by the
Liquidation Trustee in connection with collecting or recovering any Prepetition Collateral will be
netted against the proceeds collected therefrom.
K. Resignation or Removal of Liquidation Trustee
If the Liquidation Trustee resigns or is removed, dissolves, or is incapacitated, the terms
of the Liquidation Trust Agreement shall govern regarding the designation of a successor
Liquidation Trustee, and following such designation, the successor Liquidation Trustee, without
further act, shall become fully vested with all of the rights, powers, duties, and obligations of his
or her predecessor, with the same compensation of the predecessor Liquidation Trustee. No
successor Liquidation Trustee shall in any event have any liability or responsibility for the acts
or omissions of any of his or her predecessors.
L. Reliance on Documents
The Liquidation Trustee may rely, and shall be protected in acting or refraining from
acting, upon any certificates, opinions, statements, instruments or reports believed by it to be
genuine and to have been signed or presented by the proper entity, including, without limitation,
claims lists and data provided to the Liquidation Trustee by the Claims Agent, the Debtors, or the
Debtors’ financial advisor, upon which the Liquidation Trustee shall base Distributions.
M. Corporate Action
The Plan will be administered by the Liquidation Trustee and all actions taken under the
Plan in the name of the Debtors shall be taken through the Liquidation Trustee in accordance
with the provisions of the Plan and the Liquidation Trust Agreement.
N. Liquidation and Dissolution of Debtors
On the Effective Date, without the necessity for any other or further action to be taken by
or on behalf of the Debtors, and upon the transfer of the Liquidation Trust Assets to the
Liquidation Trust and the Prepetition Collateral to BP in accordance with the Plan, the members
of the board of directors or managers, as the case may be, and the respective officers, of each of
the Debtors shall be deemed to have been removed, and each such Debtor shall be deemed
dissolved for all purposes unless the Liquidation Trustee determines that dissolution can have
any adverse impact on the Liquidation Trust Assets, the Prepetition Collateral, and the
Postpetition Collateral; provided, however, that neither the Debtors nor any party released
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pursuant to the Plan shall be responsible for any liabilities that may arise as a result of non-
dissolution of the Debtors.
O. Dissolution of Creditors’ Committee
On the Effective Date, the Creditors’ Committee shall be deemed to be dissolved and the
members of the Creditors’ Committee shall be released and discharged from all further authority,
duties, responsibilities, and obligations arising from or related to the Bankruptcy Cases and
Professionals retained by the Committee shall be released and discharged from all further
authority, duties, responsibilities, and obligations relating to the Debtors and the Bankruptcy
Cases; provided, however, that the foregoing shall not apply to any matters concerning (a) any
Professional Fee Claims held or asserted by any Professional retained by the Committee or
reimbursement of any reasonable and documented expenses of the Committee’s members
incurred in their capacity as such, (b) any appeal from the Confirmation Order, or (c) the
withdrawal of the Standing Motion pursuant to the Plan.
P. Closing of the Bankruptcy Cases
After all Disputed Claims filed against the Debtors have become Allowed Claims or have
been Disallowed, and all Assets have been liquidated and converted into Cash (other than those
Assets that have been or may be abandoned), and such Cash has been distributed in accordance
with the Plan, or at such earlier time as the Liquidation Trustee deems appropriate, the
Liquidation Trustee shall seek authority from the Bankruptcy Court to close the Bankruptcy
Cases in accordance with the Bankruptcy Code and the Bankruptcy Rules.
Q. Plan Distributions
After the Effective Date, and subject to the establishment and funding of the Liquidation
Trust, the Confirmation Fund, Liquidation Trust Expense Fund, and Confirmation Reserve under
the Plan, Distributions shall be made by the Liquidation Trustee in accordance with the Plan.
R. Preservation and Abandonment of Records
The Debtors shall preserve for the benefit of the Liquidation Trustee all Retained
Information. After the Effective Date, the Liquidation Trustee shall preserve the Retained
Information until the date that is at least one (1) year following the closing of the Bankruptcy
Cases. On the Effective Date, the Debtors shall be permitted to abandon (with or without
destruction) any information that is not Retained Information.
S. General Disposition of Assets
Pursuant to Bankruptcy Code section 1123(a)(5) and subject to the terms of the Plan, as
soon as is reasonably practicable after the Effective Date, the Liquidation Trustee shall sell or
otherwise dispose of, and liquidate to or otherwise convert to Cash, any non-Cash Assets in such
manner as the Liquidation Trustee shall determine in his judgment in consultation with the
Secured Creditors (to the extent any such Assets are collateral of the Secured Creditors), but in
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no event shall the Liquidation Trustee be prevented from returning Assets that are collateral of a
Secured Creditor to such Secured Creditor in a commercially reasonable manner.
T. Final Administrative Expense Claims Bar Date
The Confirmation Order shall establish that requests for payment of Administrative
Expense Claims that were not required to be filed and served by the First Administrative
Expense Claim Bar Date (or any other subsequent bar date established by the Bankruptcy Court
for Administrative Expense Claims), other than:
(a) an Administrative Expense Claim that has become an Allowed Administrative
Expense Claim on or before the Effective Date;
(b) an Administrative Expense Claim on account of fees and expenses incurred on or
after the Petition Date by ordinary course professionals retained by the Debtor pursuant to an
order of the Bankruptcy Court; or
(c) an Administrative Expense Claim arising out of the employment by the Debtor of
an individual in the ordinary course of business from and after the Petition Date, but only to the
extent that such Administrative Expense Claim is solely for outstanding wages, commissions,
accrued benefits, or reimbursement of business expenses;
must be filed and served on or before 5:00 p.m. (prevailing Eastern Time) on or before the first
Business Day after the fourteenth (14th) day after the Confirmation Date (the “Final
Administrative Expense Claims Bar Date”).
Objections, if any, to a timely request for payment of an Administrative Expense Claim
must be filed and served on the Liquidation Trustee and the requesting party no later than ninety
(90) days after the Effective Date.
No payment or Distributions will be made on account of any Administrative Expense
Claim until such Claim becomes an Allowed Claim. Any Person asserting an Administrative
Expense Claim that was subject to the First Administrative Expense Claim Bar Date that did not
timely file and serve an application or motion seeking approval of such Administrative Expense
Claim shall be forever barred from asserting any such right to payment as against the Debtors,
the Estates, and the Liquidation Trust. Any Person asserting an Administrative Expense Claim
not subject to the First Administrative Expense Claim Bar Date that fails to file and serve an
application or motion seeking approval of the Administrative Expense Claim on or before the
Final Administrative Expense Claims Bar Date shall be forever barred from asserting any such
right to payment as against the Debtors, the Estates, and the Liquidation Trust.
U. Deadline for Filing Applications for Professional Fee Claims
All parties seeking payment of Professional Fee Claims must file with the Bankruptcy
Court a final application and/or an application for payment of reasonable fees and expenses
under Bankruptcy Code section 503(b), as applicable, on or before the first Business Day after
the thirtieth (30th) day after the Effective Date (the “Fee Application Deadline”). Any
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Professional failing to file and serve such final application or 503(b) motion on or before the Fee
Application Deadline shall be forever barred from asserting any such right to payment against
the Debtors or the Estates. Objections to such Professional Fee Claims, if any, must be filed and
served no later than fifty (50) days after the Effective Date.
V. Execution of Documents to Effectuate Plan
From and after the Effective Date, the Liquidation Trustee shall have the exclusive power
and authority to execute any instrument or document to effectuate the provisions of the Plan.
Entry of the Confirmation Order shall authorize the Debtors and the Liquidation Trustee to take,
or cause to be taken, all actions necessary or appropriate to consummate and implement the
provisions of the Plan.
W. Disallowance of Claims Without Further Order of the Court
As of the Effective Date, any Scheduled Claim designated as disputed, contingent, or
unliquidated in amount and for which a proof of Claim has not been filed by the Creditor by the
applicable Bar Date shall be deemed Disallowed and expunged. All Scheduled Claims that
correspond to a proof of Claim filed by a particular Creditor by the applicable Bar Date shall be
deemed to have been superseded by such later filed proof of Claim, and the Scheduled Claim,
regardless of priority, shall be expunged from the Claims register; provided however, that such
proofs of Claim shall be subject to objection in accordance with the Plan.
X. Post-Effective Date Reports and Fees
Following the Effective Date and until the Bankruptcy Cases are closed, not less than
once every one-hundred and eighty (180) days, the Liquidation Trustee shall be responsible for
the filing of all post-Effective Date reports required during such periods with the U.S. Trustee
regarding the liquidation or other administration of property under the Liquidation Trustee’s
control pursuant to the Plan, Distributions made by the Liquidation Trustee, and other matters
required to be included in such report, and shall pay from the Liquidation Trust Expense Fund all
post-Effective Date fees charged or assessed against the Estate under 28 U.S.C. §1930 during
such periods together with applicable interest pursuant to 31 U.S.C. § 3717. Notwithstanding
any substantive consolidation of the Debtors under the Plan, each and every Debtor and the
Liquidation Trustee shall remain obligated to pay quarterly fees to the U.S. Trustee until the
particular Debtor’s case has been closed, dismissed, or converted to a case under chapter 7 of the
Bankruptcy Code.
Y. Cancellation of Notes, Instruments, Certificates, and Other Documents
Except as expressly provided herein, on the Effective Date, all notes, instruments,
certificates evidencing debt of, or Interests in, the Debtors and any warrants, options, and other
entitlements to purchase and/or receive Interests in the Debtors, shall be deemed surrendered and
cancelled and any obligation of the Debtors thereunder shall be discharged; provided, however,
that the liens in favor of BP under the Final DIP Order and the Prepetition BP Secured Loan
Documents shall remain attached and fully perfected against the Postpetition Collateral and the
Prepetition Collateral (other than the Liquidation Trust Assets) until the repayment in full of the
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DIP Financing Claims and the return of the Postpetition Collateral and the Prepetition Collateral
(other than the Liquidation Trust Assets) to BP.
Z. Insurance Preservation
Nothing in the Plan, the Confirmation Order, or the Liquidation Trust Agreement, alters
the rights and obligations of the Debtors (and their Estates) and the Debtors’ insurers (and third-
party claims administrators) under the Insurance Policies or modifies the coverage or benefits
provided thereunder or the terms and conditions thereof or diminishes or impairs the
enforceability of the Insurance Policies. All of the Debtors’ rights and their Estates’ rights under
any Insurance Policy to which the Debtors and/or the Debtors’ Estates may be beneficiaries shall
vest with the Liquidation Trust for the benefit of the Beneficiaries of the Liquidation Trust and
all of the beneficiaries of such policies. For the avoidance of doubt, the Debtors are deemed to
have assumed all of the Insurance Policies.
AA. Preservation of Causes of Action
Except as otherwise provided in the Plan or in any contract, instrument, release, or
agreement entered into in connection with the Plan and the Final DIP Order, in accordance with
Bankruptcy Code section 1123(b), all Claims and Causes of Action that the Debtors or Estates
may have against any Person or Entity are preserved and transferred to the Liquidation Trustee
on the Effective Date, including, without limitation, any and all Causes of Action the Debtors,
Estates, or other appropriate party in interest may assert under Bankruptcy Code sections 502,
510, 522(f), 522(h), 542, 543, 544, 545, 547, 548, 549, 550, 551, 553 and 724(a).
BB. Section 1146 Exemption from Certain Taxes and Fees
Pursuant to and to the extent set forth in Bankruptcy Code section 1146(a), any issuance,
transfer, or exchange of a security, or the making or delivery of an instrument of transfer of
property, pursuant to or in connection with the Plan shall not be subject to any Stamp or Similar
Tax or governmental assessment in the United States or by any other Governmental Unit, and the
Confirmation Order shall direct the appropriate federal, state or local (domestic or foreign)
governmental officials or agents to forgo the collection of any such Stamp or Similar Tax or
governmental assessment and to accept for filing and recordation instruments or other documents
evidencing such action or event without the payment of any such Stamp or Similar Tax or
governmental assessment. Such exemption specifically applies, without limitation, to all actions,
agreements and documents necessary to evidence and implement the provisions of, transactions
contemplated by and the distributions to be made under the Plan.
CC. Withdrawal of the Standing Motion
Within three (3) business days after the Effective Date, the Committee shall file a notice
of withdrawal of the Standing Motion.
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DD. Settlement Pursuant to Bankruptcy Rule 9019
Pursuant to Bankruptcy Code section 1123 and Bankruptcy Rule 9019, the Plan
incorporates a compromise and settlement of various potential Claims and Causes of Action,
including those for which the Committee sought standing to bring pursuant to the Standing
Motion. The settlement of those potential Claims and Causes of Action is a cornerstone of the
Plan and necessary to achieve a beneficial and efficient resolution of the Chapter 11 Cases for all
parties in interest. The Plan shall be deemed to constitute a motion pursuant to Bankruptcy Rule
9019, seeking approval of a settlement, and the entry of the Confirmation Order shall constitute
the Bankruptcy Court’s approval of such motion, and the Bankruptcy Court’s findings shall
constitute its determination that such compromises and settlements encompassed in the Plan are
within the range of reasonableness, in the best interests of the Debtors, their Estates, their
Creditors, and other parties-in-interest, and fair and equitable.
EE. Return of Deposits
Unless the Debtors have agreed otherwise in a written agreement or stipulation approved
by the Bankruptcy Court, all security deposits, including Posted Collateral, provided by the
Debtors to any Entity at any time shall be returned to the Liquidation Trustee within twenty (21)
days after the Effective Date, without deduction or offset of any kind.
VI. TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES
All executory contracts and unexpired leases of the Debtors shall be deemed rejected as
of the Effective Date, unless a particular executory contract or unexpired lease (i) has previously
been assumed or rejected pursuant to an order of the Bankruptcy Court or applicable provisions
of the Bankruptcy Code, (ii) has expired or otherwise terminated pursuant to its terms, or (iii) is
the subject of a separate assumption motion filed by one of the Debtors (with the consent of the
Committee and BP) under Bankruptcy Code section 365.
Any party to an executory contract or unexpired lease that is rejected in accordance with
the Plan shall file a proof of Claim for damages from such rejection no later than thirty (30) days
after the Effective Date. The failure to timely file a proof of Claim shall be deemed a waiver of
any Claim in connection with the rejection of such contract or lease.
VII. CONDITIONS PRECEDENT; CONFIRMATION AND EFFECTIVE DATE
A. Conditions Precedent to Plan Confirmation
The following conditions must be satisfied or waived by the Debtors, with the consent of
BP and the Committee, in accordance with the Plan on or before the Confirmation Date:
(a) The Disclosure Statement Order shall have been entered by the Bankruptcy
Court and shall have become a Final Order; and
(b) The Confirmation Order to be entered by the Bankruptcy Court shall
contain provisions that, among other things: (i) authorize the implementation of the Plan in
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accordance with its terms; (ii) approve in all respects the other settlements, transactions, and
agreements to be effectuated under the Plan; (iii) find that the Plan complies with all applicable
provisions of the Bankruptcy Code, including that the Plan was proposed in good faith and that
the Confirmation Order was not procured by fraud; (iv) order that the Assets of the Estates are
transferred to the Liquidation Trustee on the Effective Date, free and clear of all Claims, liens,
Encumbrances and interests of any Entity except for the liens and security interests of the
Secured Creditors; and (v) order that the Liquidation Trustee is authorized to take any and all
action necessary or appropriate to perform his duties hereunder.
B. Conditions Precedent to the Effective Date
The Effective Date shall not occur and no obligations under the Plan shall come into
existence unless each of the following conditions is met or, alternatively, is waived in accordance
with the Plan:
(a) The Confirmation Order shall have become a Final Order and such order
shall not have been amended, modified, vacated, stayed, or reversed;
(b) All requisite filings with governmental authorities and third parties, to the
extent required, shall have become effective;
(c) All documents contemplated by the Plan to be executed and delivered on
or before the Effective Date shall have been executed and delivered;
(d) The Liquidation Trustee shall have been designated by the Committee,
after consultation with BP, and shall be empowered to take all actions as contemplated by the
Plan and the Liquidation Trustee Agreement; and
(e) The Confirmation Fund, Professional Fee Escrow Account, Initial
Liquidation Trust Funding, Liquidation Trust Expense Fund, and Disputed Confirmation Reserve
shall be fully funded as may be applicable.
C. Waiver of Conditions Precedent
Each condition precedent in the Plan, except the condition precedent in Section (a) above,
may be waived or modified by the Debtors, with the written consent of BP and the Committee,
without further Court approval, in whole or in part. The condition precedent in Section (a) above
shall be waived or modified by the Debtors, upon written direction from BP and the Committee,
without further Court approval.
VIII. INJUNCTIONS; STAYS; RELEASE; EXCULPATIONS
A. General Injunctions
As set forth in Article 8 of the Plan, the following provisions shall apply and shall be
fully set forth in the Confirmation Order.
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i. Injunctions Against Interference with Consummation or Implementation of
Plan
All holders of Claims or Interests shall be enjoined from commencing or continuing
any judicial or administrative proceeding or employing any process against any of the
Debtors or the Estates with the intent or effect of interfering with the consummation or
implementation of the Plan or the transfers, payments or Distributions to be made
hereunder.
ii. Plan Injunction
Except as otherwise specifically provided for by the Plan, on and after the
Effective Date, all Persons shall be enjoined from (i) the enforcement, attachment,
collection, or recovery by any manner or means of any judgment, award, decree, or
order; (ii) the creation, perfection, or enforcement of any Encumbrance of any kind; (iii)
the commencement or continuation of any action, employment of process or act to
collect, offset, or recover any Claim or Cause of Action satisfied, released, or enjoined
under the Plan; and/or (iv) the assertion of any right of setoff, counterclaim, exculpation,
or subrogation of any kind, in each case against the Debtors or the Estates to the fullest
extent authorized or provided by the Bankruptcy Code.
iii. No Bar To Claims Against Third Parties
Holders of Claims or Interests against the Debtors are not barred or otherwise
enjoined by the Plan from pursuing any recovery against Persons that are not the
Debtors, except as set forth in this Article 8 of the Plan.
B. All Distributions Received in Full and Final Satisfaction
Except as otherwise set forth in the Plan, all payments and all Distributions to be made in
accordance with the Plan on account of Claims (including Administrative Expense Claims) shall
be received in full and final satisfaction, settlement and release of the Estates’ obligations for
such Claims as against the Debtors and their property and the Estates.
C. No Modification of Res Judicata Effect
No provision of the Plan is intended or shall be construed to modify the res judicata
effect of any order entered in the Bankruptcy Cases, including, without limitation, the
Confirmation Order and any order finally determining Professional Fee Claims to any
Professional.
D. Exculpation for Debtors, Committee, and Estate Professionals
To the extent permitted by Bankruptcy Code section 1125(e), the Debtors, their
equity holders, officers, directors, employees and Professionals (including the professional
firms and individuals within such firms), and the Committee and its members (acting in
such capacity), their respective officers, directors, employees and Professionals (including
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professional firms and individuals within such firms) shall neither have nor incur any
liability to any Person for any act taken or omitted to be taken in connection with or
related to the formulation, preparation, dissemination, implementation, administration,
funding, confirmation or consummation of the Plan, the Disclosure Statement, or any
contract, instrument, release or other agreement or document created or entered into in
connection with the Plan, or any act taken or omitted to be taken during the Bankruptcy
Cases, except for acts or omissions as a result of willful misconduct or gross negligence as
determined by a Final Order of a court of competent jurisdiction, and in all respects shall
be entitled to rely reasonably upon the advice of counsel with respect to their duties and
responsibilities under the Plan. From and after the Effective Date, a copy of the
Confirmation Order and the Plan shall constitute, and may be submitted as, a complete
defense to any Claim or liability released under the Plan.
E. Exculpation for Liquidation Trustee
The Liquidation Trustee and its employees, attorneys, accountants, financial
advisors, representatives and agents, and the Oversight Committee, each solely in such
capacity, shall not have or incur any liability to any person or entity for any act or omission
in connection with, or arising out of, the Plan or the property to be distributed under the
Plan, except for acts or omissions as a result of willful misconduct or gross negligence as
determined by a Final Order of a court of competent jurisdiction.
F. Releases by the Debtors
Effective as of the Effective Date, without in any manner limiting or altering any
releases granted to the Postpetition Secured Party and Senior Lien Secured Party under
the Final DIP Order, each Debtor on behalf of itself and its Estate, each of their respective
affiliates, and each of their respective former, current, or future officers, employees,
directors, agents, representatives, owners, members, partners, financial advisors, legal
advisors, shareholders, managers, consultants, accountants, attorneys, affiliates, and
predecessors in interest, for good and valuable consideration provided by each of the
Released Parties, shall be deemed to provide a full release to each of the Released Parties
(and each such Released Party shall be deemed released by each Debtor and its Estate) and
their respective property from any and all Causes of Action and any other debts,
obligations, rights, suits, damages, actions, derivative Claims, remedies, and liabilities
whatsoever, whether known or unknown, foreseen or unforeseen, existing as of the
Effective Date, in law, at equity, or otherwise, whether for tort, contract, violations of
federal or state securities laws, or otherwise, based in whole or in part upon any act or
omission, transaction, or other occurrence or circumstance existing or taking place prior to
or on the Effective Date arising from or related in any way to the Debtors, the Plan,
Briarcliff, the Debtors’ out-of-court restructuring efforts, the Bankruptcy Cases, the
Postpetition Supply Facility, the Postpetition Transaction Documents, and the Senior Lien
Transaction Documents (as defined in the Final DIP Order) or any matters arising under
or in connection with the same, including those that the Debtors would have been legally
entitled to assert or that any holder of a Claim against or Interest in the Debtors, or any
other Entity could have been legally entitled to assert derivatively or on behalf of the
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Debtors or their Estates; provided, however, that the foregoing Debtor Release shall not
operate to waive or release any Claims or causes of action of the Debtors or their Estates
for actual fraud or fraud grounded in deliberate recklessness. For the avoidance of doubt,
any Claims in respect of Avoidance Actions against the Released Parties shall be released.
Nothing in the foregoing shall result in any current directors and officers of the Debtors
waiving any indemnification Claims against the Debtors or any of their insurance carriers
or any rights as beneficiaries of any insurance policies.
Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval,
pursuant to Bankruptcy Rule 9019, of the Debtor Release, which includes by reference
each of the related provisions and definitions contained in the Plan, and further, shall
constitute the Bankruptcy Court’s finding that the Debtor Release is: (1) in exchange for
the good and valuable consideration provided by the Released Parties; (2) a good-faith
settlement and compromise of the Claims released by the Debtor Release; (3) in the best
interests of the Debtors’ Estates and all holders of Claims and Interests; (4) fair, equitable,
and reasonable; (5) given and made after due notice and opportunity for hearing; and (6) a
bar to any of the Debtors’ Estates or the Liquidation Trustee asserting any Claim or Cause
of Action released under the Debtor Release.
G. Releases by Releasing Parties
Effective as of the Effective Date, the Releasing Parties shall be deemed to provide a
full release to the Released Parties and their respective property from any and all Causes of
Action and any other debts, obligations, rights, suits, damages, actions, derivative Claims,
remedies, and liabilities whatsoever, whether known or unknown, foreseen or unforeseen,
existing as of the Effective Date, in law, at equity, or otherwise, whether for tort, contract,
violations of federal or state securities laws, or otherwise, based in whole or in part upon
any act or omission, transaction, or other occurrence or circumstance existing or taking
place prior to or on the Effective Date arising from or related in any way to the Debtors,
the Plan, Briarcliff, the Debtors’ out-of-court restructuring efforts, the Bankruptcy Cases,
the Postpetition Supply Facility, the Postpetition Transaction Documents, and the Senior
Lien Transaction Documents (as defined in the Final DIP Order) or any matters arising
under or in connection with the same, including those that the Debtors would have been
legally entitled to assert or that any holder of a Claim against or Interest in the Debtors or
any other Entity could have been legally entitled to assert derivatively or on behalf of the
Debtors or their Estates.
Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval,
pursuant to Bankruptcy Rule 9019, of the Third Party Release, which includes by reference
each of the related provisions and definitions contained in the Plan, and further, shall
constitute the Bankruptcy Court’s finding that the Third Party Release is: (1) in exchange
for the good and valuable consideration provided by the Released Parties; (2) a good-faith
settlement and compromise of the Claims released by the Third Party Release; (3) in the
best interests of the Debtors’ Estates and all holders of Claims and Interests; (4) fair,
equitable, and reasonable; (5) given and made after due notice and opportunity for
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hearing; and (6) a bar to any of the Releasing Parties asserting any Claim released under
the Third Party Release.
Nothing in this Section shall release any right or obligation of any party under any
other provision of the Plan or the Confirmation Order.
IX. PROVISIONS GOVERNING DISTRIBUTIONS
Article 9 of the Plan establishes the procedures and guidelines for Distributions to be
made to the terms of the Plan to the holders of Claims, including the timing, procedures and
notice provisions related to same. Distributions shall be made by the Liquidation Trustee as
follows.
A. Payments in U.S. Dollars
All Cash payments required under the Plan shall be made in U.S. dollars by checks drawn
on a domestic bank selected by the Liquidation Trustee in accordance with the Plan or by wire
transfer from a domestic bank, at the option of the Liquidation Trustee. The Liquidation Trustee
may use the services of a third party to aid in the Distributions required to be made under the
Plan.
B. Distributions Only on Business Days
Notwithstanding the foregoing provisions, if any Distribution under the Plan is due on a
day other than a Business Day, such Distribution shall instead be made on the next Business
Day.
C. Unclaimed Distributions
Unclaimed Distributions shall be canceled (by a stop payment order or otherwise), the
Claim(s) relating to such Distribution(s) shall be deemed forfeited and expunged without any
further action or order of the Bankruptcy Court, and the holder of such Claim(s) shall be
removed from the Distribution schedules and expunged from the Claims register and shall
receive no further Distributions under the Plan. Any such Unclaimed Distributions shall, as soon
as is practicable, be redistributed pursuant to the provisions of the Plan.
D. Timing of Distributions Generally
The first Distribution shall occur as soon as practicable on or after the Effective Date. To
the extent subsequent Distributions are necessary, such subsequent Distributions shall occur as
soon after the first Distribution Date as the Liquidation Trustee shall reasonably determine is
appropriate in light of (i) the amount of Cash on hand; (ii) the amount and nature of Disputed
Claims; (iii) the activities to be accomplished, including their anticipated duration and costs; (iv)
the length of time since any prior Distribution; and (v) the costs of effecting any interim
Distribution.
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E. Timing of Distributions on Disputed Claims Subsequently Allowed
If a Disputed Claim is Allowed, in whole or in part, after the Effective Date, a
Distribution shall be made on account of such Allowed Claim on the next Distribution Date that
is at least fifteen (15) Business Days after such Claim is Allowed.
F. No Payment or Distribution of Disputed Claims
Any contrary provision hereof or of the Plan notwithstanding, no payments or other
Distributions shall be made on account of any Disputed Claim, or any portion thereof, unless and
until such Claim is Allowed by Final Order. For the avoidance of doubt, no portion of any
Disputed Claim is entitled to a Distribution. Holders of Disputed Claims shall be bound,
obligated and governed in all respects by the Plan’s provisions.
G. Disputed Distribution
If a dispute arises as to the identity of a holder of an Allowed Claim who is to receive a
Distribution, the Liquidation Trustee may, in lieu of making such Distribution to such holder,
hold such amount until the dispute is resolved by Final Order or by written agreement among the
parties to such dispute.
H. Transmittal of Payments and Notices
All Distributions shall be made to the holder of a Claim by regular first-class mail,
postage prepaid, in an envelope addressed to such holder at the address listed on its proof of
Claim filed with the Claims Agent or Bankruptcy Court or, if no proof of Claim was filed, (i) at
the address listed on the Debtors’ Schedules, or (ii) at such address that a holder of a Claim
provides to the Debtors and the Liquidation Trustee after the Effective Date in writing and files
at least fifteen (15) Business Days prior to a Distribution Date. Neither the Debtors nor the
Liquidation Trustee shall have any duty to ascertain the mailing address of any holder of a Claim
other than as set forth in the Plan. The date of payment or delivery shall be deemed to be the
date of mailing. Payments made in accordance with the Plan shall be deemed made to the holder
regardless of whether such holder actually receives the payment.
I. Record Date for Distributions
Except as otherwise provided in a Final Order, transferees of Claims that are transferred
pursuant to Bankruptcy Rule 3001 with appropriate filings made on or before the Effective Date
(the “Record Date”) shall be treated as the holders of those Claims for all purposes,
notwithstanding that any period provided by Bankruptcy Rule 3001 for objecting to the
transfer(s) may not have expired prior to the Record Date. The Debtors and the Liquidation
Trustee shall have no obligation to recognize any transfer of any Claim occurring after the
Record Date. In making a Distribution with respect to any Claim, the Debtors and the
Liquidation Trustee shall be entitled to recognize and deal for all purposes hereunder only with
the Person who is listed on the proof of Claim filed with respect to such Claim, on the Debtors’
Schedules as the holder thereof, and upon such other evidence or record of transfer or assignment
filed as of the Record Date.
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J. Claims Administration Responsibility
(a) Reservation of Rights. Unless a Claim is specifically Allowed prior to or after the
Effective Date or under the Plan, the Liquidation Trustee reserves any and all objections to any
and all Claims and motions or requests for the payment of Claims, whether administrative
expense, secured or unsecured, including, without limitation, any and all objections to the
validity or amount of any and all alleged DIP Financing Claims, Administrative Expense Claims,
Priority Tax Claims, or Non-Tax Priority Claims, liens and security interests, whether under the
Bankruptcy Code, other applicable law or contract. The failure to object to any Claim prior to
the Effective Date shall be without prejudice to the Liquidation Trustee’s rights to contest or
otherwise defend against such Claim in the Bankruptcy Court when and if such Claim is sought
to be enforced by the holder of the Claim.
(b) Objections to Claims. The Liquidation Trustee may dispute, object to,
compromise, or otherwise resolve all Claims. Unless otherwise provided in the Plan or ordered
by the Bankruptcy Court, all objections to Claims shall be filed and served no later than the
Claims Objection Bar Date, provided that the Liquidation Trustee may request (and the
Bankruptcy Court may grant) an extension of time by filing a motion with the Bankruptcy Court.
(c) Filing Objections. An objection to a Claim shall be deemed properly served on
the claimant if Liquidation Trustee causes service of any such objection to be effected in
accordance with Bankruptcy Rule 3007 by mailing or otherwise delivering the objection and a
notice of hearing thereon to the claimant at the address set forth on such claimant’s proof of
Claim at least thirty (30) days prior to the hearing thereon.
(d) Determination of Claims. Except as otherwise agreed by the Debtors, any Claim
as to which a proof of Claim or motion or request for payment was timely filed in the
Bankruptcy Cases may be determined and liquidated after the Effective Date pursuant to (i) a
Final Order, or (ii) applicable non-bankruptcy law. Any Claim determined to be an Allowed
Claim after the Effective Date shall be treated as an Allowed Claim in accordance with the Plan.
K. Disputed Claims.
(a) For purposes of effectuating the provisions of the Plan and the Distributions to
holders of Allowed Claims, the Bankruptcy Court, on or prior to the Effective Date, or thereafter
upon the request of any holder of a Claim or the Liquidation Trustee, may liquidate the amount
of Disputed Claims pursuant to Bankruptcy Code section 502(c), in which event the amounts so
fixed or liquidated shall be deemed to be the aggregate amounts of the Disputed Claims under
Bankruptcy Code section 502(c) for purposes of Distribution under the Plan and for purposes of
the Disputed Confirmation Reserve and Disputed GUC Fund.
(b) When a Disputed Claim becomes an Allowed Claim, there shall be distributed to
the holder of such Allowed Claim, in accordance with the provisions of the Plan (but in no event
later than the next succeeding Distribution Date), Cash in the amount of all Distributions to
which such holder would have been entitled if such holder’s Claim were Allowed on the
Effective Date, to the extent of available Cash to make such Distribution.
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(c) In no event shall any holder of any Disputed Claim be entitled to receive (under
the Plan or otherwise) any Cash payment that is greater than the amount reserved, if any, for
such Disputed Claim under the Plan. In no event shall the Debtors or the Liquidation Trustee
have any responsibility or liability for any loss to or of any amount reserved under the Plan
unless such loss is the result of that party’s fraud, willful misconduct, or gross negligence. In no
event may any Creditor whose Disputed Claim is subsequently Allowed, pursue or recover from
any other Creditor any funds received as Distributions under the Plan.
(d) To the extent that a Disputed Claim ultimately becomes an Allowed Claim and is
entitled to a Distribution in an amount less than the amount reserved for such Disputed Claim,
then on the next succeeding Distribution Date, the Liquidation Trustee shall make, in accordance
with the terms of the Plan, a Distribution of the excess amount reserved for such Disputed Claim
in accordance with the Plan.
(e) The Disputed Confirmation Reserve and the Disputed GUC Fund shall be treated
as disputed ownership funds, within the meaning of Treasury Regulation section 1.468B-9, for
all purposes associated with taxation.
(f) Except as expressly set forth in the Plan, or otherwise agreed to in writing or
ordered by the Bankruptcy Court, the Liquidation Trustee shall not have any duty to fund the
Disputed Confirmation Reserve or Disputed GUC Fund.
(g) The Liquidation Trustee shall pay, or cause to be paid, out of the funds held in the
Disputed Confirmation Reserve and the Disputed GUC Fund, any tax imposed by any federal,
state, or local taxing authority on the income generated by the funds or property held in the
Disputed Confirmation Reserve and the Disputed GUC Fund, respectively. The Liquidation
Trustee shall file, or cause to be filed, any tax or information return related to the Disputed
Confirmation Reserve and the Disputed GUC Fund that is required by any federal, state, or local
taxing authority.
L. No Payments of Fractional Cents or Distributions of Less Than Thirty-Five Dollars
(a) Any contrary provision hereof or of the Plan notwithstanding, for purposes of
administrative convenience, no payment of fractional cents shall be made pursuant to the Plan.
Whenever any payment of a fraction of a cent under the Plan would otherwise be required, the
actual Distribution made shall reflect a rounding of such fraction to the nearest whole penny (up
or down), with halfpennies or less being rounded down and fractions in excess of half of a penny
being rounded up.
(b) Any contrary provision hereof or of the Plan notwithstanding, for purposes of
administrative convenience, no Distribution of less than thirty-five dollars ($35) shall be made
pursuant to the Plan. Whenever any Distribution of less than thirty-five dollars ($35) under the
Plan would otherwise be required, such funds will be retained by the Liquidation Trustee for the
account of the recipient until such time that successive Distributions aggregate to thirty-five
dollars ($35), at which time such payment shall be made, and if successive Distributions do not
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ever reach thirty-five dollars ($35) in the aggregate, then such Distributions shall be returned to
the Liquidation Trust.
M. Setoff and Recoupment
Except as otherwise provided in the Plan, the Liquidation Trustee may, but shall not be
required to, set off against, or recoup from, any Claim and the Distributions to be made pursuant
to the Plan in respect thereof, any Claims, defenses or Causes of Action of any nature whatsoever
that the Debtors may have, but neither the failure to do so nor the allowance of any Claim under
the Plan shall constitute a waiver or release by the Debtors or Liquidation Trustee of any right of
setoff or recoupment against the holder of any Claim.
N. Payment of Taxes on Distributions Received Pursuant to the Plan
(a) As a precondition to payment of any Distribution to a Creditor under the Plan,
unless included on the official proof of Claim form filed by such Creditor in the Bankruptcy
Cases, each Creditor shall provide the Liquidation Trustee a valid tax identification or social
security number (collectively, the “Tax Information”) for purposes of tax reporting by the
Debtors. All Entities that receive Distributions under the Plan shall be responsible for reporting
and paying, as applicable, any taxes on account of their Distributions.
(b) At such time as the Debtors or Liquidation Trustee believe that Distributions to a
particular Class of Claims are likely, the Liquidation Trustee shall request Tax Information in
writing from the Creditors (the “Tax Information Request”). Any Creditor who fails to respond
to Tax Information Request within ninety (90) days from the date posted on the Tax Information
Request shall forfeit all Distributions such Creditor may otherwise be entitled to under the Plan,
and such forfeited funds will revert to the Estates to be disbursed in accordance with the terms
and priorities established in the Plan.
O. Compliance With Tax Withholding and Reporting Requirements
With respect to all Distributions made under the Plan, the Debtors and Liquidation
Trustee will comply with all withholding and reporting requirements of any federal, state, local,
or foreign taxing authority.
X. PLAN INTERPRETATION, CONFIRMATION, AND VOTING
A. Procedures Regarding Objections to Designation of Classes as Impaired or
Unimpaired
If the treatment of a Class as impaired or unimpaired is objected to, the Bankruptcy Court
shall determine the objection and voting shall be permitted or disregarded in accordance with the
determination of the Bankruptcy Court.
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B. Withdrawal and Modification of Plan
The Plan may be withdrawn or modified by the Debtors at any time prior to the
Confirmation Date. The Debtors may modify the Plan, with the consent of BP and the
Committee, in any manner consistent with Bankruptcy Code section 1127 prior to substantial
consummation thereof. Upon request by the Liquidation Trustee, and with the consent of BP, the
Plan may be modified after substantial consummation with the approval of the Bankruptcy
Court, provided that such modification does not affect the essential economic treatment of any
Person that objects in writing to such modification.
C. Governing Law
Unless a rule of law or procedure is supplied by federal law (including the Bankruptcy
Code and the Bankruptcy Rules) or the Plan, the laws of the State of New York applicable to
contracts executed in such State by residents thereof and to be performed entirely within such
State shall govern the construction and implementation of the Plan and any agreements,
documents and instruments executed in connection with the Plan.
D. Voting of Claims
Each holder of a Claim as of the Record Date in Classes 1B, 2, 3, and 4 shall be entitled
to vote to accept or reject the Plan. The Disclosure Statement Order shall govern the manner and
procedures for casting of Ballots with the Voting Agent.
E. Acceptance by Impaired Class
Consistent with Bankruptcy Code section 1126(c), and except as provided for in
Bankruptcy Code section 1126(e), a Class of creditors shall have accepted the Plan if it is
accepted by at least two-thirds in dollar amount and more than one-half in number of the holders
of Allowed Claims of such Class that have timely and properly voted to accept or reject the Plan.
F. Presumed Acceptances of Plan
Classes 1A is unimpaired under the Plan and, therefore, is conclusively presumed to have
accepted the Plan.
G. Presumed Rejections of Plan
Class 5 is presumed to have rejected the Plan but may elect to accept the Plan.
H. Cram Down
The Bankruptcy Code permits confirmation of a plan even if it is not accepted by all
impaired classes, as long as (a) the plan otherwise satisfies the requirements for confirmation, (b)
at least one impaired class of claims has accepted the plan without taking into consideration the
votes of any insiders in such class, and (c) the plan is “fair and equitable” and does not
“discriminate unfairly” as to any impaired class that has not accepted the plan. These so-called
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“cramdown” provisions are set forth in Bankruptcy Code section 1129(b). The Debtors request
that, in the event that any impaired Class entitled to vote on the Plan accepts the Plan, the
Bankruptcy Court confirm the Plan in accordance with the provisions of Bankruptcy Code
section 1129(b) to satisfy the requirements for confirmation of the Plan over the presumed
rejection of Class 5 and/or the possible rejection of the Plan by any impaired Class entitled to
vote on the Plan.
(a) “Fair and Equitable.” The Bankruptcy Code establishes different “cram down”
tests for determining whether a plan is "fair and equitable" to dissenting impaired classes of
secured creditors, unsecured creditors and equity interest holders as follows:
i. Secured Creditors. A plan is fair and equitable to a class of secured
claims that rejects the plan if the plan provides: (a) that each holder of a
secured claim included in the rejecting class (i) retains the liens securing
its claim to the extent of the allowed amount of such claim, whether the
property subject to those liens is retained by the debtor or transferred to
another entity, and (ii) receives on account of its secured claim deferred
cash payments having a present value, as of the effective date of the plan,
at least equal to such holder’s interest in the estate’s interest in such
property; (b) that each holder of a secured claim included in the rejecting
class realizes the “indubitable equivalent” of its allowed secured claim; or
(c) for the sale, subject to Bankruptcy Code section 363(k), of any
property that is subject to the liens securing the claims included in the
rejecting class, free and clear of such liens with such liens to attach to the
proceeds of the sale, and the treatment of such liens on proceeds in
accordance with clause (i) or (ii) of this paragraph.
ii. Unsecured Creditors. A plan is fair and equitable as to a class of
unsecured claims that rejects the plan if the plan provides that: (a) each
holder of a claim included in the rejecting class receives or retains under
the plan property of a value, as of the effective date of the plan, equal to
the amount of its allowed claim; or (b) the holders of claims and interests
that are junior to the claims of the rejecting class will not receive or retain
any property under the plan on account of such junior claims or interests.
iii. Holders of Interests. A plan is fair and equitable as to a class of interests
that rejects the plan if the plan provides that: (a) each holder of an equity
interest included in the rejecting class receives or retains under the plan
property of a value, as of the effective date of the plan, equal to the
greatest of the allowed amount of (i) any fixed liquidation preference to
which such holder is entitled, (ii) any fixed redemption price to which
such holder is entitled or (iii) the value of the interest; or (b) the holder of
any interest that is junior to the interests of the rejecting class will not
receive or retain any property under the plan on account of such junior
interest.
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The Debtors believe the Plan is fair and equitable as to unsecured creditors and holders of
interests because no holders of claims or interests junior to such parties are receiving any
distributions under the Plan on account of such claims or interests.
(b) “Unfair Discrimination.” A plan of reorganization does not “discriminate
unfairly” if a dissenting class is treated substantially equally with respect to other classes
similarly situated, and no class receives more than it is legally entitled to receive for its claims or
interests. The Debtors carefully designed the Plan to ensure that the Plan did not result in unfair
discrimination among similarly situated classes. The Debtors do not believe that the Plan
discriminates unfairly against any impaired class of claims or interests. The Debtors believe that
the Plan and the treatment of all classes of claims and interests under the Plan satisfy the
foregoing requirements for “cram down,” or non-consensual confirmation of the Plan pursuant to
Bankruptcy Code section 1129(b).
XI. RETENTION OF JURISDICTION BY BANKRUPTCY COURT
From the Confirmation Date until entry of a final decree closing the Bankruptcy Cases
(pursuant to Bankruptcy Code § 350 and Bankruptcy Rule 3022), the Bankruptcy Court shall
retain such jurisdiction as is legally permissible over the Bankruptcy Cases for the following
purposes:
(a) to hear and determine any and all objections to the allowance of any Claim or
Administrative Expense Claim, or any controversy as to the classification of Claims or any
matters that may directly, indirectly or contingently affect the obligations of the Debtors or the
Liquidation Trustee, holders of Claims, or other parties in interest;
(b) to hear and determine any and all applications for compensation and
reimbursement of expenses by Professionals;
(c) to hear and determine any and all pending motions for the assumption or rejection
of executory contracts and unexpired leases, and to fix any Claims resulting therefrom;
(d) to adjudicate through final judgment such contested matters and adversary
proceedings as may be pending or subsequently initiated in the Bankruptcy Court, including, but
not limited to, Causes of Action brought by the Liquidation Trustee;
(e) to enforce and interpret the provisions of the Plan, the Disclosure Statement
Order, the Confirmation Order and any other order of the Bankruptcy Court in the Bankruptcy
Cases;
(f) to issue any injunction or other relief appropriate to implement the intent of the
Plan, and to enter such further orders enforcing any injunctions or other relief issued under the
Plan or pursuant to the Confirmation Order;
(g) to modify the Plan pursuant to Bankruptcy Code section 1127 and the applicable
Bankruptcy Rules;
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(h) to correct any defect, cure any omission, or reconcile any inconsistency in the
Plan or in the Confirmation Order as may be necessary to carry out the purposes and the intent of
the Plan;
(i) to interpret and determine such other matters as the Confirmation Order may
provide for or as may be authorized under the Bankruptcy Code; and
(j) to enter and implement such orders as may be appropriate if the Confirmation
Order is, for any reason, stayed, reversed, revoked, modified, or vacated.
XII. CERTAIN TAX CONSEQUENCES OF THE PLAN
A. General
THIS DESCRIPTION IS LIMITED TO THE SPECIFIC FEDERAL INCOME
TAX MATTERS DESCRIBED HEREIN. IT IS POSSIBLE THAT ADDITIONAL
ISSUES MAY EXIST THAT COULD AFFECT THE FEDERAL INCOME TAX
CONSEQUENCES OF THE PLAN OR OTHER FEDERAL INCOME TAX MATTERS
DISCUSSED HEREIN, AND THIS DISCUSSION DOES NOT CONSIDER OR
PROVIDE ANY CONCLUSIONS WITH RESPECT TO ANY SUCH ADDITIONAL
ISSUES. EACH TAXPAYER IS STRONGLY URGED TO SEEK ADVICE BASED ON
THE TAXPAYER’S PARTICULAR CIRCUMSTANCES FROM SUCH TAXPAYER’S
INDEPENDENT TAX ADVISOR.
THE DESCRIPTION OF CERTAIN FEDERAL INCOME TAX
CONSEQUENCES OF THE PLAN PROVIDED BELOW IS SOLELY FOR THE
PURPOSE OF COMPLIANCE WITH BANKRUPTCY CODE SECTION 1125(a). THE
DESCRIPTION IS BASED ON THE INTERNAL REVENUE CODE TREASURY
REGULATIONS, JUDICIAL DECISIONS, AND ADMINISTRATIVE
DETERMINATIONS, ALL AS IN EFFECT ON THE DATE OF THIS DISCLOSURE
STATEMENT. CHANGES IN ANY OF THESE AUTHORITIES OR IN THEIR
INTERPRETATION MAY HAVE RETROACTIVE EFFECT, WHICH MAY CAUSE
THE FEDERAL INCOME TAX CONSEQUENCES OF THE PLAN TO DIFFER
MATERIALLY FROM THE CONSEQUENCES DESCRIBED BELOW. EXCEPT AS
PROVIDED BELOW, NO RULING HAS BEEN REQUESTED FROM THE IRS AND
NO LEGAL OPINION HAS BEEN REQUESTED FROM COUNSEL CONCERNING
ANY TAX CONSEQUENCE OF THE PLAN, AND NO TAX OPINION OR ADVICE IS
GIVEN BY THIS DISCLOSURE STATEMENT.
This description does not cover all aspects of federal income taxation that may be
relevant to the Debtors or holders of Claims or Interests. For example, the description does not
address issues of special concern to certain types of taxpayers, such as dealers in securities, life
insurance companies, financial institutions, tax exempt organizations, and foreign taxpayers, nor
is it intended to address all of the possible federal income tax consequences to holders of Claims
and Interests in the Debtors. This description also does not discuss the possible state tax or non-
U.S. tax consequences that might apply to the Debtors or to holders of Claims or Interests.
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B. Tax Consequences of Payment of Allowed Claims Pursuant to Plan Generally
The federal income tax consequences of the implementation of the Plan to the holders of
Allowed Claims will depend, among other things, on the consideration to be received by the
holder, whether the holder reports income on the accrual or cash method, whether the holder’s
Claim is Allowed or Disputed on the Effective Date, and whether the holder has taken a bad debt
deduction or a worthless security deduction with respect to its Claim.
(i) Recognition of Gain or Loss
In general, a holder of an Allowed Claim or Interest should recognize gain or loss equal
to the amount realized under the plan in respect of its claim less the holder’s tax basis in the
claim. Any gain or loss recognized in the exchange may be long-term or short-term capital gain
or loss or ordinary income or loss, depending upon the nature of the allowed claim and the
holder, the length of time the holder held the claim and whether the claim was acquired at a
market discount. If the holder realizes a capital loss, the holder’s deduction of the loss may be
subject to limitation. The holder’s tax basis for any property received under the plan generally
will equal the amount realized.
(ii) Bad Debt or Worthless Security Deduction
A holder who receives in respect of an Allowed Claim an amount less than the holder’s
tax basis in the Claim may be entitled in the year of receipt (or in an earlier or later year) to a bad
debt deduction in some amount under section 166(a) of the Internal Revenue Code. The rules
governing the character, timing and amount of bad debt deductions place considerable emphasis
on the facts and circumstances of the holder, the obligor and the instrument with respect to which
a deduction is claimed. Holders of Allowed Claims, therefore, are urged to consult their tax
advisors with respect to their ability to take such a deduction.
XIII. CONFIRMATION OF PLAN – REQUIREMENTS
In order for a plan to be confirmed, the Bankruptcy Code requires, among other things,
that the plan be proposed in good faith, that the plan proponent disclose specified information
concerning payments made or promised to insiders, and that the plan comply with the applicable
provisions of chapter 11 of the Bankruptcy Code. Bankruptcy Code section 1129(a) also
requires that at least one class of claims that is impaired under the plan has accepted the plan and
that confirmation of the plan is not likely to be followed by the need for further financial
reorganization. The Bankruptcy Court can confirm the plan if it finds that all of the requirements
of section 1129(a) have been met. The Debtors believe that the Plan meets all of these required
elements. With respect to the so-called “feasibility” test (i.e., that the Plan is not likely to be
followed by the need for further financial reorganization), the Plan provides for an orderly
liquidation of the Debtors’ assets and the Debtors believe that they will be able to consummate
the Plan fully.
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A. Absolute Priority Rule
To satisfy the absolute priority rule, a plan must provide that the holder of any claim or
interest that is junior to the claims of the dissenting class will not receive or retain under the plan
on account of such junior claim or interest any property unless the claims of the dissenting class
are paid in full.
The Debtors believe that the Plan satisfies the absolute priority rule. The Debtors further
believe that all non-accepting impaired Classes will receive or retain payment or Distribution, as
the case may be, on account of their Claims or Interests, sufficient to permit full satisfaction of
such Claims before junior Classes receive or retain any property on account of such junior
Claims.
B. Best Interest of Creditors Test; Liquidation Analysis
Under the best interest of creditors test, a plan is confirmable if, with respect to each
impaired class of claims or interests, each holder of an allowed claim or allowed interest in such
class has either (i) accepted the plan, or (ii) receives or retains under the plan, on account of its
claim or interest, property of a value, as of the effective date, that is not less than the amount
such holder would receive or retain if the debtor were to be liquidated under chapter 7 of the
Bankruptcy Code.
To determine what the holders of each class of claims or interests would receive if a
debtor were to be liquidated under chapter 7 of the Bankruptcy Code, the Bankruptcy Court must
determine the dollar amount that would be generated from the liquidation of the debtor’s assets
in a chapter 7 liquidation case. The amount that would be available for satisfaction of the
allowed claims and interests of the debtor would consist of the proceeds resulting from the
disposition of the assets of the debtor augmented by the cash held by the debtor at the time of the
commencement of the chapter 7 case. Such amounts would be reduced by the costs and
expenses of the liquidation and by such additional administrative expense claims and other
priority claims that might result from the chapter 7 case.
Here, the Debtors’ major assets have been liquidated as of the date of this Disclosure
Statement. The Debtors believe that a conversion of the Bankruptcy Cases to chapter 7 would
simply duplicate an orderly plan process, and that Creditors would be harmed by the delay and
expense that would result.
To determine if the Plan, as proposed, is in the best interests of creditors and holders of
interests, the present values of the distributions likely to be made to each class in a liquidating
case are compared with the present value of the distributions to each impaired class provided for
by the plan.
In applying the best interest test, it is possible that claims in a chapter 7 case may not be
classified in the same manner as provided for by the plan. Priorities and order of distribution of
estate assets are established by the applicable provisions of chapter 7. Under those provisions,
each class of claims is paid in a descending order of priority. No junior classes of claims are
paid until all senior classes have received payment in full. In the event that available assets are
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insufficient to pay all members of such class in full, then each member of the class shares on a
pro rata basis.
The Debtors believe that the primary advantage of the Plan over a chapter 7 liquidation is
that Creditors will likely receive more under the Plan than they would in a chapter 7 case and
receive their Distributions earlier. Costs would increase by the amount of the additional
administrative expenses likely to be incurred in such a chapter 7 case, including the costs of
time-consuming investigations and discovery. The process of other Claims resolution will
proceed without the necessity for additional investigation by a chapter 7 trustee and its separate
and new professionals, and the Plan offers the opportunity to avoid additional administrative
costs and the resulting delay which would result from a chapter 7 liquidation. The Debtors
therefore believe that the Plan will result in lower total administrative costs and higher recoveries
for Creditors than would the liquidation of the Debtors’ assets under chapter 7 of the Bankruptcy
Code. A liquidation analysis that demonstrates the lower recovery for creditors in a chapter 7
liquidation is annexed hereto as Exhibit B.
Thus, the Debtors believe the Plan satisfies the “best interests of creditors test,” and,
indeed, that the Plan is in the best interests of Creditors.
XIV. PROCEDURES FOR VOTING ON PLAN
As noted above, pursuant to the Bankruptcy Code, a plan groups various claims and
interests into classes, each consisting of parties having similar legal rights in relation to a debtor.
Each class may then be treated as either “impaired” or “unimpaired” under a plan. There are two
ways in which a plan may leave a claim or interest “unimpaired.” First, a plan may not propose
to alter the legal, equitable or contractual rights of the holder of the claim or interest. Second, all
defaults (excluding those covered by Bankruptcy Code section 365(b)(2)) may be cured and the
original terms of the obligation reinstated, among other things. If a class is unimpaired, then it is
presumed to vote in favor of a plan.
An impaired class that would receive nothing under a plan is presumed to have rejected
such a plan.
An impaired class that is proposed to receive any distribution (whether in cash, securities
or other property) has the right to vote, as a class, to accept or reject the plan. A class of
creditors accepts a plan if more than one-half (1/2) of the ballots that are timely received from
members of such class, representing at least two-thirds (2/3) of the dollar amount of claims for
which ballots are timely received, vote in favor of such plan. Bankruptcy Code section 1126(e)
provides that a creditor’s vote may be disregarded if the Bankruptcy Court determines, after
notice and a hearing, that the creditor’s vote either to accept or reject a plan was not solicited or
cast in good faith or in compliance with the Bankruptcy Code. A plan under which any class of
claims is impaired may be confirmed by the Bankruptcy Court only if it has been accepted by at
least one such class.
Each holder of an Allowed Claim in an impaired Class that retains or receives property
under the Plan shall be entitled to vote separately to accept or reject the Plan and shall indicate
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such vote on a duly executed and delivered Ballot as provided in such order as is entered by the
Bankruptcy Court establishing certain procedures with respect to the solicitation and tabulation
of votes to accept or reject the Plan, or any other order or orders of the Bankruptcy Court.
Holders of Claims in the impaired Classes entitled to vote will receive, together with this
Disclosure Statement, a Ballot to be used in voting to accept or reject the Plan. Voting
instructions will accompany the Ballot.
Each Creditor should first carefully review this Disclosure Statement and the Plan. The
Creditor should then complete the portions of the Ballot indicating the Class or Classes in which
the Creditor’s Claim falls and the total dollar amount of the Claim. If the Creditor’s Claim falls
into more than one Class, then the Creditor should list each Class and state the dollar amount of
the Claim which belongs in each Class. It is critical that the Class(es) and amounts(s) of the
Claim be correctly stated on the Ballot so that the Creditor’s vote can be properly counted.
Next, the Creditor should mark in the space provided on the Ballot whether the Creditor
wishes to accept or to reject the Plan. Please be sure to fill in the name of the Creditor for whom
the Ballot is being filed. Finally, the Ballot must be signed by the Creditor, or by an officer,
partner, or other authorized agent of the Creditor. Please note that the Debtors reserve the right
to object to the allowance, designation of Class and/or allowable amount of any Claim set forth
in a Ballot for purposes of voting and/or Distribution under the Plan.
Completed and signed Ballots should be returned by first class mail to the Voting Agent
at the below address in the enclosed self-addressed return envelope:
Agera Balloting
c/o Stretto
8269 E. 23rd Ave., Ste. 275
Denver, CO 80238
Completed and signed Ballots may also be returned by overnight mail or hand delivery to
the address above.
Completed Ballots should be returned as soon as possible, and in any event so that they
are RECEIVED NO LATER THAN JUNE 3, 2020 AT 4:00 P.M. (PREVAILING EASTERN
TIME). ANY BALLOTS THAT ARE RECEIVED BY THE VOTING AGENT AFTER JUNE
3, 2020 AT 4:00 P.M. (PREVAILING EASTERN TIME) WILL NOT BE COUNTED IN
DETERMINING ACCEPTANCE OR REJECTION OF THE PLAN.
XV. CONFIRMATION HEARING
The Confirmation Hearing will be held by the Honorable Robert D. Drain, United States
Bankruptcy Judge, on June 8, 2020 at 2:00 p.m. (prevailing Eastern Time) in the United States
Bankruptcy Court, Southern District of New York, 300 Quarropas Street, Courtroom No. 118,
White Plains, NY 10601. At that hearing, the Bankruptcy Court will decide whether the Plan
should be confirmed and will hear and decide any and all objections to the Plan. Any Creditor,
or other party in interest who wishes to object to Confirmation of the Plan, or to the classification
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of Claims and Interests provided in the Plan, must, not later than 4:00 p.m. (prevailing Eastern
Time) on June 3, 2020 file an objection with the Clerk’s Office, United States Bankruptcy Court,
Southern District of New York, 300 Quarropas Street, White Plains, NY 10601, and serve a copy
of the objection on the following persons:
(a) Counsel to the Debtors: (b) Counsel to the Official Committee of
Unsecured Creditors:
Mcdermott Will & Emery LLP
340 Madison Avenue
New York, NY 10173
Attn: Darren Azman
Ravi Vohra
Kilpatrick Townsend & Stockton LLP
The Grace Building
1114 Avenue of the Americas
New York, NY 10036-7703
Attn: Todd C. Meyers
Kilpatrick Townsend & Stockton LLP
1100 Peachtree Street
Suite 2800
Atlanta, GA 30309
Attn: Colin M. Bernardino
(c) Office of the United States Trustee:
(d) Counsel to BP:
Office of the United States Trustee
U.S. Federal Office Building
201 Varick Street
New York, New York 10004
Attn: Andrea Schwartz
Shannon Scott
Haynes and Boone, LLP
1221 McKinney Street
Suite 2100
Houston, TX 77010
Attn: Kathryn Shurin
Kelli Stephenson Norfleet
Any objections to the Plan that are not filed and served by the above date may not be
considered by the Bankruptcy Court. Any person or entity who files an objection to
Confirmation of the Plan or to the classification of Claims and Interests provided in the Plan
must also attend the Confirmation Hearing, either in person or through counsel.
If the Plan is confirmed, its provisions will bind the Estate and any and all entities,
including all holders of Claims and Interests, whether or not the Claim or Interest of such
claimant or interest holder is impaired under the Plan and whether or not the claimant or interest
holder has, either individually or by a Class, voted to accept the Plan.
XVI. RECOMMENDATION
The Debtors believe that the Plan provides for the fair and equitable treatment of the
Debtors’ Creditors and therefore recommends that Creditors vote to accept the Plan.
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Dated: April 1, 2020
New York, New York
By: /s/ Mark Linzenbold__
Mark Linzenbold
Chief Financial Officer
Agera Energy LLC
By: /s/ Mark Linzenbold__
Mark Linzenbold
Chief Financial Officer
Agera Holdings, LLC
By: /s/ Mark Linzenbold__
Mark Linzenbold
Chief Financial Officer
energy.me midwest llc
By: /s/ Mark Linzenbold__
Mark Linzenbold
Chief Financial Officer
Aequitas Energy, Inc.
By: /s/ Stephen Gray______
Stephen Gray
Manager
Utility Recovery LLC
By: /s/ Stephen Gray______
Stephen Gray
Manager
Agera Solutions LLC
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Exhibit A
Plan
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UNITED STATES BANKRUPTCY COURT
SOUTHERN DISTRICT OF NEW YORK
)
In re: ) Chapter 11
)
AGERA ENERGY LLC, et al.,1 )
)
Case No. 19-23802 (RDD)
Debtors.
)
)
(Jointly Administered)
JOINT CHAPTER 11 PLAN OF LIQUIDATION OF AGERA ENERGY LLC, ET AL.
MCDERMOTT WILL & EMERY LLP
Timothy W. Walsh
Darren Azman
Ravi Vohra
Natalie Rowles
340 Madison Avenue
New York, New York 10173
Telephone: (212) 547-5615
Facsimile: (212) 547-5444
Counsel to the Debtors and Debtors in Possession
Dated: April 1, 2020
New York, New York
1 The Debtors, together with the last four digits of each Debtor’s federal tax identification number, are: Agera
Energy LLC (8122); Agera Holdings, LLC (3335); energy.me midwest llc (9484); Aequitas Energy, Inc. (7988);
Utility Recovery LLC (4351); and Agera Solutions LLC (8749). The location of the Debtors’ corporate
headquarters and the service address for all Debtors is 555 Pleasantville Road, S-107, Briarcliff Manor, NY 10510.
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TABLE OF CONTENTS
INTRODUCTION ...........................................................................................................................1
ARTICLE 1 - DEFINITIONS AND RULES OF INTERPRETATION .........................................1
A. Definitions................................................................................................................1
B. Rules of Interpretation ...........................................................................................11
ARTICLE 2 - PAYMENT OF CLAIMS NOT REQUIRED TO BE CLASSIFIED ....................12
2.1 Claims Not Classified. ...........................................................................................12
2.2 DIP Financing Claims. ...........................................................................................12
2.3 Administrative Expense Claims. ............................................................................12
2.4 Professional Fee Claims .........................................................................................12
2.5 Priority Tax Claims. ...............................................................................................13
2.6 Non-Tax Priority Claims........................................................................................13
2.7 Intercompany Claims. ............................................................................................13
ARTICLE 3 - CLASSIFICATION OF CLAIMS AND INTERESTS ..........................................13
3.1 Criterion of Class. ..................................................................................................13
3.2 Classification..........................................................................................................14
3.3 Class Categories. ....................................................................................................14
ARTICLE 4 - TREATMENT OF CLASSES OF CLAIMS AND INTERESTS ..........................14
4.1 Class 1A (Allowed Other Secured Claims). ..........................................................14
4.2 Class 1B (Allowed Prepetition BP Secured Claim). ..............................................14
4.3 Class 2 (Allowed General Unsecured Claims). .....................................................15
4.4 Class 3 (Allowed BP Deficiency Claim and Allowed BP
Subordinated Claim). .............................................................................................16
4.5 Class 4 (Allowed Prepetition CBLIC Claims). ......................................................16
4.6 Class 5 (Interests). ..................................................................................................16
ARTICLE 5 - MEANS OF IMPLEMENTATION OF THE PLAN .............................................16
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5.1 Joint Chapter 11 Plan. ............................................................................................16
5.2 Substantive Consolidation of Claims Against Debtors for Plan
Purposes Only. .......................................................................................................16
5.3 Plan Funding Mechanism. .....................................................................................17
5.4 Formation of the Liquidation Trust........................................................................17
5.5 Establishment of Reserves and Escrow Accounts. ................................................17
5.6 Powers and Duties of the Liquidation Trustee. ......................................................19
5.7 Appointment of the Liquidation Trustee................................................................21
5.8 Issuance of General Unsecured Creditor Interests. ................................................21
5.9 Liquidation Trustee Reporting. ..............................................................................22
5.10 Fees and Expenses of the Liquidation Trustee. .....................................................22
5.11 Resignation or Removal of Liquidation Trustee. ...................................................22
5.12 Reliance on Documents .........................................................................................22
5.13 Corporate Action. ...................................................................................................23
5.14 Liquidation and Dissolution of Debtors. ................................................................23
5.15 Dissolution of Creditors’ Committee. ....................................................................23
5.16 Closing of the Bankruptcy Cases. ..........................................................................23
5.17 Plan Distributions...................................................................................................23
5.18 Preservation and Abandonment of Records. ..........................................................24
5.19 General Disposition of Assets. ...............................................................................24
5.20 Final Administrative Expense Claims Bar Date. ...................................................24
5.21 Deadline for Filing Applications for Professional Fee Claims. .............................25
5.22 Execution of Documents to Effectuate Plan. .........................................................25
5.23 Disallowance of Claims Without Further Order of the Court................................25
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5.24 Post-Effective Date Reports and Fees....................................................................26
5.25 Cancellation of Notes, Instruments, Certificates, and Other
Documents. ............................................................................................................26
5.26 Insurance Preservation. ..........................................................................................26
5.27 Preservation of Causes of Action. ..........................................................................26
5.28 Section 1146 Exemption from Certain Taxes and Fees .........................................27
5.29 Withdrawal of the Standing Motion. .....................................................................27
5.30 Settlement Pursuant to Bankruptcy Rule 9019. .....................................................27
5.31 Return of Deposits. ................................................................................................27
ARTICLE 6 - TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED
LEASES .............................................................................................................................28
6.1 General Provisions. ................................................................................................28
6.2 Notice of Deemed Rejection/Rejection Bar Date. .................................................28
ARTICLE 7 - CONDITIONS PRECEDENT; CONFIRMATION AND EFFECTIVE DATE ...28
7.1 Conditions Precedent to Plan Confirmation. .........................................................28
7.2 Conditions Precedent to the Effective Date. ..........................................................28
7.3 Waiver of Conditions Precedent. ...........................................................................29
ARTICLE 8 - INJUNCTION; RELEASE; EXCULPATION .......................................................29
8.1 General Injunctions. ...............................................................................................29
8.2 All Distributions Received in Full and Final Satisfaction. ....................................30
8.3 No Modification of Res Judicata Effect.................................................................30
8.4 Exculpation for Debtors, Committee, and Estate Professionals. ...........................30
8.5 Exculpation for Liquidation Trustee. .....................................................................30
8.6 Releases by the Debtors. ........................................................................................31
8.7 Releases by Releasing Parties ................................................................................32
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ARTICLE 9 - PROVISIONS GOVERNING DISTRIBUTIONS .................................................32
9.1 Payment in U.S. Dollars.........................................................................................32
9.2 Distributions Only on Business Days. ...................................................................33
9.3 Unclaimed Distributions. .......................................................................................33
9.4 Timing of Distributions Generally. ........................................................................33
9.5 Timing of Distributions on Disputed Claims Subsequently
Allowed. .................................................................................................................33
9.6 No Payment or Distribution on Disputed Claims. .................................................33
9.7 Disputed Distribution. ............................................................................................33
9.8 Transmittal of Payments and Notices. ...................................................................34
9.9 Record Date for Distributions. ...............................................................................34
9.10 Claims Administration Responsibility. ..................................................................34
9.11 Disputed Claims. ....................................................................................................35
9.12 No Payments of Fractional Cents or Distributions of Less Than
Thirty-Five Dollars. ...............................................................................................36
9.13 Setoff and Recoupment ..........................................................................................36
9.14 Payment of Taxes on Distributions Received Pursuant to the Plan. ......................36
9.15 Compliance With Tax Withholding and Reporting Requirements. .......................37
ARTICLE 10 - PLAN INTERPRETATION, CONFIRMATION AND VOTING ......................37
10.1 Procedures Regarding Objections to Designation of Classes as
Impaired or Unimpaired. ........................................................................................37
10.2 Withdrawal and Modification of Plan....................................................................37
10.3 Governing Law. .....................................................................................................37
10.4 Voting of Claims. ...................................................................................................38
10.5 Acceptance by Impaired Class. ..............................................................................38
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10.6 Presumed Acceptances of Plan. .............................................................................38
10.7 Presumed Rejections of Plan. ................................................................................38
10.8 Cramdown. .............................................................................................................38
ARTICLE 11 - RETENTION OF JURISDICTION BY BANKRUPTCY COURT ....................38
ARTICLE 12 - MISCELLANEOUS PROVISIONS ....................................................................39
12.1 Headings. ...............................................................................................................39
12.2 No Attorneys’ Fees. ...............................................................................................39
12.3 Notices. ..................................................................................................................39
12.4 No Discharge. ........................................................................................................40
12.5 Claims In Dollars. ..................................................................................................40
12.6 Binding Effect. .......................................................................................................40
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INTRODUCTION
Agera Energy LLC and its debtor affiliates, as debtors and debtors in possession
(collectively, the “Debtors”), propose this chapter 11 plan (this “Plan”) under Bankruptcy Code
section 1121.
ARTICLE 1 - DEFINITIONS AND RULES OF INTERPRETATION
A. Definitions
The following terms, when used in this Plan, or any subsequent amendments or
modifications thereof, have the respective meanings hereinafter set forth and shall be equally
applicable to the singular and plural of terms defined.
1.1 “Administrative Expense Claim” means a Claim, other than a DIP Financing
Claim and a Professional Fee Claim, entitled to priority under Bankruptcy Code section 503(b),
507(a)(2), or 507(b), including, without limitation, (a) BP’s professional fees (to the extent not
satisfied as DIP Financing Claims) and (b) any fees or charges assessed against the Estates under
section 1930, chapter 123, title 28 of the United States Code.
1.2 “Affiliate” has the meaning assigned to such term in Bankruptcy Code section
101(2).
1.3 “Agera Opco Entities” means Agera Energy LLC, energy.me midwest llc, and
Aequitas Energy, Inc.
1.4 “Allowed” means, with respect to a Claim against or Interest in the Debtors, (i)
proof of which was originally filed within the applicable period of limitation fixed by the
Bankruptcy Court in accordance with Rule 3003(c)(3) of the Bankruptcy Rules and any Final
Order, (ii) if no proof of Claim or Interest has been timely filed, which has been or hereafter is
listed by the Debtors in their Schedules as liquidated in an amount and not Disputed or
contingent, as to which no objection to the allowance thereof has been interposed within the
applicable period of limitation fixed by this Plan, the Bankruptcy Code, the Bankruptcy Rules, a
Final Order, or the Claims Objection Bar Date, but only to the extent applicable, or as to which
an objection has been interposed and such Claim or Interest has been allowed in whole or in part
by a Final Order, or (iii) a Claim or Interest that is allowed by Final Order; provided, however,
that (a) Claims allowed solely for the purpose of voting to accept or reject the Plan pursuant to an
order of the Bankruptcy Court shall not be considered “Allowed Claims” hereunder unless
otherwise specified herein or by order of the Bankruptcy Court, (b) “Allowed Claim” does not
include interest, penalties, or late charges arising from or relating to the period from and after the
Petition Date, and (c) “Allowed Claim” does not include any Claim subject to disallowance
under Bankruptcy Code section 502(d).
1.5 “Approved Budget” means the budget attached to the Interim DIP Order, the
budget attached to the Final DIP Order, or the budgets approved under the Final DIP Order, filed
on December 18, 2019 [Docket No. 330], February 9, 2020 [Docket No. 448], March 6, 2020
[Docket No. 504], March 13, 2020 [Docket No. 517], March 20, 2020 [Docket No. 551], March
28, 2020 [Docket No. 590], and April [], 2020 [Docket No. []].
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1.6 “Assets” means all property of the Estates, including, without limitation, all
property and other interests identified in Bankruptcy Code section 541(a) wherever located and
whether acquired prior to or after the Petition Date, including Cash, furniture, fixtures,
equipment, artwork, intellectual property, Causes of Action, together with the proceeds and
products, replacements, and accessions thereof, including, without limitation, the Briarcliff
Membership Interests and Posted Collateral.
1.7 “Avoidance Action” means any Cause of Action to avoid or recover a transfer of
property of the Estates or an interest of the Debtors in property, including, without limitation,
actions arising under Bankruptcy Code sections 542, 543, 544, 545, 547, 548, 549, 550, 551,
553(b), or 724(a) and any other applicable federal, state, or common law.
1.8 “Ballot” means the form distributed to the holder of an impaired Claim on which
it is to be indicated whether such holder accepts or rejects the Plan.
1.9 “Bankruptcy Cases” means the voluntary cases commenced under chapter 11 of
the Bankruptcy Code on the Petition Date, jointly administered under case number 19-23802
(RDD) in the United States Bankruptcy Court for the Southern District of New York.
1.10 “Bankruptcy Code” means title 11 of the United States Code.
1.11 “Bankruptcy Court” or “Court” means the United States Bankruptcy Court for the
Southern District of New York.
1.12 “Bankruptcy Rules” means the Federal Rules of Bankruptcy Procedure, as
promulgated by the Supreme Court of the United States, as amended, and any Local Rules of the
Bankruptcy Court, as amended, in effect and applicable to the Bankruptcy Cases.
1.13 “Bar Date” means December 23, 2019 at 5:00 p.m. (prevailing Eastern Time), the
date established by the Bankruptcy Court as the deadline to file proofs of Claim or, with respect
to Governmental Units, April 1, 2020 at 5:00 p.m., as applicable, unless the Bankruptcy Court has
set a different date by which a specific Creditor must file a proof of Claim, in which case it means,
for such specific Creditor, such different date set by the Court.
1.14 “BP” means BP Energy Company.
1.15 “BP Deficiency Claim” means any Deficiency Claim related to the Prepetition BP
Secured Claim.
1.16 “BP Subordinated Claim” means $16,698,538.92.
1.17 “Briarcliff” means the real property of Briarcliff Property Group, LLC, located at
555 Pleasantville Road, S-107, Briarcliff Manor, NY 10510.
1.18 “Briarcliff Membership Interests” means Agera Energy LLC’s 100% membership
interests in Briarcliff Property Group, LLC.
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1.19 “Business Day” means any day other than a Saturday, Sunday, or a “legal
holiday,” as such term is defined in Bankruptcy Rule 9006(a).
1.20 “Cash” means legal tender of the United States of America.
1.21 “Causes of Action” means any and all Claims, rights, actions, chose in action,
suits, causes of action, liens, judgments, and damages belonging to the Debtors or their Estates
and any and all liabilities, obligations, covenants, undertakings, and debts owing to the Estates,
of whatever nature and whenever arising, whether known or unknown, in law, equity, or
otherwise, including, without limitation, actions arising under Bankruptcy Code sections 541 and
542 and any other applicable federal, state, or common law.
1.22 “CBLIC” means Colorado Bankers Life Insurance Company.
1.23 “Claim” has the meaning assigned to such term in Bankruptcy Code section
101(5).
1.24 “Claims Agent” means Stretto, which was appointed by the Bankruptcy Court to
receive, maintain, docket, and otherwise administer the proofs of Claim filed in the Bankruptcy
Cases.
1.25 “Claims Objection Bar Date” means, unless otherwise extended by Order of the
Court, the first Business Day that is 120 days after the Effective Date.
1.26 “Class” means a category of Claims or Interests described in ARTICLE 3.
1.27 “Confirmation Amount” means all Cash, which shall be funded from the Effective
Date Cash, that is necessary to pay or reserve for Allowed Administrative Expense Claims,
Allowed Priority Tax Claims, Allowed Non-Tax Priority Claims, Professional Fee Claims,
Allowed Other Secured Claims, the GUC Budget Excess, and the Initial Liquidation Trust
Funding, but shall not include any such amounts previously paid pursuant to the Approved
Budget.
1.28 “Confirmation Date” means the date on which the Clerk of the Bankruptcy Court
enters the Confirmation Order on the docket.
1.29 “Confirmation Fund” means the segregated account established under Section
5.5(a).
1.30 “Confirmation Order” means the order of the Bankruptcy Court confirming this
Plan pursuant to Bankruptcy Code section 1129, as the Plan may be amended by its terms and
consistent with applicable law, and any findings of fact and conclusions of law contained in the
Confirmation Order or a separate document entered substantially contemporaneously therewith,
in form and substance reasonably satisfactory to the Debtors, BP, and the Committee.
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1.31 “Creditor” means any Person holding a Claim against the Debtors or, pursuant to
Bankruptcy Code section 102(2), against property of the Debtors, that arose or is deemed to have
arisen on or prior to the Petition Date, including, without limitation, a Claim against the Debtors
of the kind specified in Bankruptcy Code sections 502(g), 502(h), or 502(i).
1.32 “Creditors’ Committee” or “Committee” means the official committee of
unsecured creditors appointed by the U.S. Trustee to represent the interests of unsecured
creditors in the Bankruptcy Cases.
1.33 “D&O Policies” means all primary and excess insurance policies that provide
coverage for liability related to the actions or omissions of the Debtors’ directors and officers,
and, if applicable, “tail” or “runoff” coverage for such policies.
1.34 “Debtors” means Agera Energy LLC and its debtor affiliates, as debtors and
debtors in possession in the Bankruptcy Cases.
1.35 “Debtor Release” means the collective releases by the Debtors under Section 8.6.
1.36 “Deficiency Claim” means that portion of any Allowed Claim held by a Secured
Creditor that exceeds the value of the Assets securing such Allowed Claim.
1.37 “DIP Financing Claim” means a Claim for an accrued and outstanding amount
under the postpetition financing approved by the Final DIP Order.
1.38 “Disallowed” means, when referring to a Claim (including a Scheduled Claim) or
Interest, or any portion of a Claim or Interest, which has been disallowed or expunged by a Final
Order.
1.39 “Disclosure Statement” means the disclosure statement for the Plan and all
exhibits annexed thereto or otherwise filed in connection therewith, approved by the Bankruptcy
Court under Bankruptcy Code section 1125.
1.40 “Disclosure Statement Order” means the Final Order approving the Disclosure
Statement under Bankruptcy Code section 1125.
1.41 “Disputed” means, with respect to a Claim against or Interest in the Debtors, the
extent to which the allowance of such Claim or Interest is the subject of a timely objection,
complaint, or request for estimation in accordance with the Plan, the Bankruptcy Code, the
Bankruptcy Rules, or the Confirmation Order, or is otherwise not yet Allowed or is disputed in
accordance with applicable law, which objection, request for estimation, or dispute has not been
withdrawn with prejudice or determined by a Final Order.
1.42 “Disputed Confirmation Reserve” means the segregated account established under
Section 5.5(c).
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1.43 “Disputed GUC Fund” means the segregated account established under Section
5.5(e).
1.44 “Distribution” means any distribution made under the Plan.
1.45 “Distribution Date” means any date on which a Distribution is made or to be
made to holders of Allowed Claims under this Plan.
1.46 “Effective Date” means the first Business Day after the conditions to
effectiveness of the Plan set forth in Section 7.2 have been satisfied or waived.
1.47 “Effective Date Cash” means all Cash held by or on behalf of the Debtors as of the
Effective Date.
1.48 “Encumbrances” means, collectively, any and all security interests, liens, pledges,
Claims, levies, charges, escrows, encumbrances, options, rights of first refusal, transfer
restrictions, conditional sale contracts, title retention contracts, mortgages, hypothecations,
indentures, security agreements or other agreements, arrangements, contracts, commitments,
understandings or obligations of any kind whatsoever, whether written or oral.
1.49 “Entity” has the meaning assigned to such term in Bankruptcy Code section
101(15).
1.50 “Estate” or “Estates” means, individually or collectively, the estate or estates of
the Debtors created under Bankruptcy Code section 541.
1.51 “Fee Application Deadline” has the meaning assigned to such term in Section
5.21.
1.52 “Final Administrative Expense Claims Bar Date” has the meaning assigned to
such term in Section 5.20.
1.53 “Final DIP Order” means the Final Order entered by the Bankruptcy Court on
November 12, 2019 authorizing the Debtors’ use of cash collateral and entry into postpetition
financing [Docket No. 221].
1.54 “Final Order” means an order or judgment of the Bankruptcy Court as to which
the time to appeal, petition for certiorari, or move for reargument or rehearing has expired and as
to which no appeal, petition for certiorari, or other proceedings for reargument or rehearing shall
then be pending; provided, however, that if an appeal, writ of certiorari, reargument, or rehearing
thereof has been filed or sought, such order shall have been affirmed by the highest court to
which such order was appealed, or certiorari shall have been denied or reargument or rehearing
shall have been denied or resulted in no modification of such order, and the time to take any
further appeal, petition for certiorari, or move for reargument or rehearing shall have expired;
provided, further, that the possibility that a motion under Bankruptcy Code section 502(j), Rule
59 or Rule 60 of the Federal Rules of Civil Procedure, or any analogous rule under the
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Bankruptcy Rules, may be but has not then been filed with respect to such order, shall not cause
such order not to be a Final Order.
1.55 “First Administrative Expense Claims Bar Date” means December 23, 2019.
1.56 “Forbearance Agreement” means that certain Forbearance Agreement and
Limited Waiver, dated November 20, 2018, between the Agera Opco Entities, BP, and Agera
Holdings, LLC.
1.57 “General Unsecured Claim” means any Unsecured Claim against any Debtor that
is not an Administrative Expense Claim, Professional Fee Claim, Priority Tax Claim, Non-Tax
Priority Claim or Intercompany Claim.
1.58 “General Unsecured Creditor Interest” means an interest in the Liquidation Trust
allocable to the respective holders of Allowed General Unsecured Claims (and any successors,
transferees, or assigns thereof) under the Plan.
1.59 “Governmental Unit” has the meaning assigned to such term in Bankruptcy Code
section 101(27).
1.60 “Guarantee Proceeds” has the meaning assigned to such term in Section 4.2.
1.61 “Guaranties” means the guaranties in favor of BP made by Greg Lindberg and
Global Health Technology Group, LLC that guaranteed the obligations of the Agera Opco
Entities and Agera Holdings, LLC under the Senior Lien Supply Agreement and the Forbearance
Agreement.
1.62 “GUC Budget Excess” means an amount, as of the Effective Date, equal to fifty
percent (50%) of any unused portion of the following line items set forth in the Approved Budget
dated April [], 2020 [Docket No []: (i) the $1,623,686 line item for payment of renewable
energy certificates or alternative compliance payments; (ii) the $2.5 million line item for
payment of sales taxes; and (iii) the $750,000 line item for payment of priority claims; provided,
however, that the GUC Budget Excess shall not exceed $1.5 million in the aggregate.
1.63 “Initial Liquidation Trust Funding” means $2.25 million, to be funded from the
Effective Date Cash.
1.64 “Insurance Policies” means all insurance policies of the Debtors, including any
D&O Policy.
1.65 “Interests” means any and all prepetition equity interests in any Debtor arising
from any form of equity securities, as defined in Bankruptcy Code section 101(16), including,
without limitation, any prepetition common and preferred stock or member interests issued and
outstanding, and all options, warrants, and other rights relating thereto.
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1.66 “Intercompany Claims” means the Claims of a Debtor against any other Debtor,
and shall exclude any claims of a Debtor against a non-Debtor Affiliate or a non-Debtor
subsidiary.
1.67 “Interim DIP Order” means the interim order entered by the Bankruptcy Court on
October 8, 2019 authorizing the Debtors’ use of cash collateral and entry into postpetition
financing [Docket No. 47].
1.68 “Liquidation Trust” means the trust established under Section 5.4 and the
Liquidation Trust Agreement.
1.69 “Liquidation Trust Agreement” means the agreement between the Debtors and the
Liquidation Trustee that, among other things, establishes the Liquidation Trust and describes the
powers, duties, and responsibilities of the Liquidation Trustee, substantially in the form included
in the Plan Supplement, which form shall be approved in writing by the Committee.
1.70 “Liquidation Trust Assets” means (a) the Avoidance Actions (other than causes of
action arising under Bankruptcy Code section 549 related to the Prepetition Collateral and any
related action under Bankruptcy Code section 550); (b) the Debtors’ commercial tort claims; (c)
the Debtors’ claims or Causes of Action against the Debtors’ directors and officers; (d) claims or
causes of action that may be satisfied by Insurance Policies, each only to the extent such Claims
or Causes of Action do not constitute Prepetition Collateral; (e) the Initial Liquidation Trust
Funding; (f) the Briarcliff Membership Interests; (g) the GUC Budget Excess; (h) the right to
receive Guarantee Proceeds (as defined in Section 4.2 of the Plan); (i) the right to receive the
CBLIC Intercreditor Proceeds (as defined in Section 4.2 of the Plan); (j) any assets of the
Debtors not otherwise distributed or administered under the Plan; and (k) any proceeds or
product of the foregoing. Notwithstanding the foregoing, the Liquidation Trust Assets shall not
include (i) the Posted Collateral, (ii) except as otherwise provided herein, the Prepetition
Collateral, or (iii) any cause of action against the Released Parties.
1.71 “Liquidation Trust Expense Fund” means a reserve established under Section
5.5(d).
1.72 “Liquidation Trust Expenses” means all fees and expenses of the Liquidation
Trust, the Liquidation Trustee, and any Professionals retained by the Liquidation Trustee or
Liquidation Trust after the Effective Date; provided, however, that any fees or expenses
(including legal) incurred by the Liquidation Trustee in connection with collecting or recovering
any Prepetition Collateral, including the Posted Collateral, shall not be considered Liquidation
Trust Expenses.
1.73 “Liquidation Trustee” means the Person designated by the Committee, after
consultation with BP, in the Plan Supplement and approved by the Bankruptcy Court pursuant to
the Confirmation Order to serve as the liquidation trustee.
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1.74 “Non-Tax Priority Claim” means a Claim, other than an Administrative Expense
Claim, Professional Fee Claim, DIP Financing Claim, or Priority Tax Claim, that is entitled to
priority in payment under Bankruptcy Code section 507(a)(1), (2) (3), (4), (5), (6), (7), or (9).
1.75 “Other Secured Claim” means any Secured Claim (other than the Prepetition BP
Secured Claim and the Prepetition CBLIC Claims) under Bankruptcy Code section 506.
1.76 “Person” means any individual, corporation, partnership, association, joint
venture, limited liability company, limited liability partnership, estate, trust, receiver, trustee,
unincorporated organization or Governmental Unit or subdivision thereof or other Entity.
1.77 “Petition Date” means October 4, 2019, the date on which the Debtors filed
voluntary petitions for relief under chapter 11 of the Bankruptcy Code.
1.78 “Plan” means this Plan and any exhibits annexed hereto or otherwise filed in
connection with the Plan, and any documents delivered in connection herewith, as the same may
be amended or modified from time to time by any duly authorized and permitted amendment or
modification.
1.79 “Plan Supplement” means the schedules and exhibits to the Plan to be filed with
the Bankruptcy Court at least ten (10) calendar days prior to the Voting Deadline (as defined in
the Disclosure Statement).
1.80 “Posted Collateral” means collateral, including, without limitation, cash, surety
bonds, and letters of credit, posted by any Debtor (or by BP on behalf of any Debtor) to any
independent system operator, regional transmission operator, utility, local distribution company,
state public utility commission or similar governing body, or other beneficiary.
1.81 “Postpetition Collateral” means the collateral securing the DIP Financing Claims.
1.82 “Postpetition Secured Party” means BP.
1.83 “Prepetition BP Secured Claim” means all obligations owed by the Debtors to BP
under the Prepetition BP Secured Loan Documents.
1.84 “Prepetition BP Secured Loan Documents” means (i) that certain Preferred
Supplier Agreement dated effective as of October 2, 2015 (as amended, modified, or
supplemented) and (ii) each of the Related Agreements (as defined in the Preferred Supplier
Agreement), including that certain ISDA 2002 Master Agreement, dated as of May 5, 2015,
together with the Schedule, Credit Support Annex, Power Annex, the Gas Annex and the
Renewable Energy Certificates Annex thereto and all confirmations thereunder, as amended by
that certain Amendment dated as of October 2, 2015, and as further amended, modified or
supplemented, among the Agera Opco Entities and BP.
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1.85 “Prepetition CBLIC Claims” means all obligations owed by Agera Energy LLC to
CBLIC under that certain Junior Loan and Security Agreement, dated February 15, 2018,
between Agera Energy LLC and CBLIC.
1.86 “Prepetition Collateral” means the collateral securing the Prepetition BP Secured
Claim, including, without limitation, the Posted Collateral.
1.87 “Priority Tax Claim” means a Claim or a portion of a Claim of a Governmental
Unit against any Debtor that is entitled to priority in payment under Bankruptcy Code sections
502(i) and 507(a)(8).
1.88 “Professional Fee Claim” means any Claim of a Professional for compensation,
indemnification, or reimbursement of costs and expenses incurred on or before the Effective
Date pursuant to Bankruptcy Codes sections 327, 328, 330, 331, 503(b), or 1103(a), plus any
fees and expenses related to the final fee application of a Professional.
1.89 “Professional Fee Escrow Account” means the account to be established on the
Effective Date and funded with the Effective Date Cash, in an amount equal to the sum of the
Professional Fee Claims not yet satisfied as of the Effective Date.
1.90 “Professionals” means all Persons retained by order of the Bankruptcy Court in
connection with the Bankruptcy Cases, pursuant to Bankruptcy Code sections 327, 328, or 1103,
excluding any ordinary course professionals.
1.91 “Pro Rata” means, in connection with a particular Allowed Claim and in
connection with any Distribution, the ratio between the amount of such Allowed Claim and the
aggregate amount of all Allowed Claims in such Class or Classes entitled to such Distribution.
1.92 “Record Date” has the meaning assigned to such term in Section 9.9.
1.93 “Released Parties” means collectively and in each case in their capacity as such:
(a) the Debtors; (b) the Committee and its members; (c) BP; and (d) with respect to each of the
foregoing entities in clauses (a) through (c), such entities’ officers, directors, and managers who
held such positions on the Petition Date, funds, affiliates, employees, partners, managers,
investment advisors, agents, representatives, principals, consultants, attorneys, professional
advisors, heirs, executors, successors and assigns (each in their capacity as such), including,
without limitation, (i) Todd Sandford, Mark Linzenbold, Stephen Gray, and Raima Jamal, (ii)
McDermott Will & Emery LLP, (iii) GlassRatner Capital & Advisory Group LLC, (iv) Miller
Buckfire & Co., LLC and Stifel, Nicolaus & Co., Inc., (v) Kilpatrick Townsend & Stockton LLP,
(vi) Dundon Advisers LLC, and (vii) Bankruptcy Management Solutions, Inc. (d/b/a Stretto);
provided, however for avoidance of doubt, that the “Released Parties” do not include Eli Global
LLC, Greg Lindberg, CBLIC, or Global Health Technology Group, LLC, or any of their
affiliates except the Debtors.
1.94 “Releasing Parties” means collectively and in each case in their capacity as such:
(a) the Released Parties identified in subsection (a)–(c) and those Released Parties identified in
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subsection (d) of the definition of “Released Parties” on behalf of whom the parties identified in
subsections (a)–(c) of the definition of “Released Parties” have the authority, including under
any agreement or applicable non-bankruptcy law, to grant the Third Party Release set forth in
Section 8.7; (b) the holders of all Claims and Interests who vote to accept the Plan; (c) the
holders of all Claims or Interests that are Unimpaired under the Plan; (d) the holders of all
Claims or Interests whose vote to accept or reject the Plan is solicited but who do not vote either
to accept or to reject the Plan; (e) the holders of all Claims or Interests who vote to reject the
Plan but do not opt out of granting the releases set forth herein; (f) the holders of all Claims or
Interests who are deemed to reject the Plan and who do not file a timely objection to the releases
provided for in Section 8.7; (g) the holders of all Claims and Interests who were given notice of
the opportunity to opt out of granting the releases set forth herein but did not opt out; and (h)
with respect to each of the foregoing entities, such entities’ current directors, current officers,
funds, affiliates, members, employees, partners, managers, investment advisors, agents,
representatives, principals, consultants, attorneys, professional advisors, heirs, executors,
successors and assigns (each in their capacity as such).
1.95 “Retained Information” means all documents and files, including electronic data
hosted on remote servers, necessary to the prosecution of the Causes of Action and Claims
reconciliation process.
1.96 “Scheduled Claim” means a Claim that is listed in the Debtors’ Schedules.
1.97 “Schedules” means the schedules of Assets and liabilities, schedules of executory
contracts and unexpired leases, statements of financial affairs, and other schedules and
statements filed by the Debtors pursuant to Bankruptcy Rule 1007, and any amendments thereto.
1.98 “Secured Claim” means a Claim secured by a “lien,” as that term is defined in
Bankruptcy Code section 101(37), including, but not limited to, a judicial lien as that term is
defined in Bankruptcy Code section 101(36), against any property of the Estates, but only to the
extent of the value, as determined by the Bankruptcy Court pursuant to Bankruptcy Code section
506(a) and Bankruptcy Rule 3012 or as otherwise agreed to, of such Creditor’s interest in any
Debtor’s interest in such property.
1.99 “Secured Creditor” means the holder of a Secured Claim.
1.100 “Senior Lien Secured Party” means BP.
1.101 “Senior Lien Supply Agreement” means that certain Preferred Supplier
Agreement between the Agera Opco Entities and BP, dated October 2, 2015 (as amended on
May 15, 2017 and February 9, 2018).
1.102 “Stamp or Similar Tax” means any stamp tax, recording tax, conveyance fee,
intangible or similar tax, mortgage tax, personal or real property tax, real estate transfer tax, sales
tax, use tax, transaction privilege tax (including, without limitation, such taxes on prime
contracting and owner-builder sales), privilege taxes (including, without limitation, privilege
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taxes on construction contracting with regard to speculative builders and owner builders), and
other similar taxes or fees imposed or assessed by any Governmental Unit.
1.103 “Standing Motion” means the Motion of the Official Committee of Unsecured
Creditors for Order Granting (I) Leave, Standing, and Authority to Commence Prosecute
Certain Claims on Behalf of the Debtors’ Estates Against BP Energy Company and (II) Related
Relief [Docket No. 518].
1.104 “Subordinate Lienholders” means AGH Parent LLC and Bainbridge Energy
Finance Fund LLC.
1.105 “Subordinated Creditor Fund” means the segregated account established under
Section 5.5(g).
1.106 “Tax Information” has the meaning assigned to such term in Section 9.14(a).
1.107 “Tax Information Request” has the meaning assigned to such term in Section
9.14(b).
1.108 “Third Party Release” has the meaning assigned to such term in Section 8.7.
1.109 “U.S. Trustee” means the Office of the United States Trustee for the Southern
District of New York.
1.110 “Unclaimed Distribution” means any Distribution that remains unclaimed after
ninety (90) days following any Distribution Date, including, without limitation, (i) checks (and
the funds represented thereby) that have been returned as undeliverable without a proper
forwarding address, (ii) funds representing checks that have not been paid, and (iii) checks (and
the funds represented thereby) that were not mailed or delivered because of the absence of a
valid address.
1.111 “Unsecured Claim” means any Claim that is not secured by an offset or “lien,” as
that term is defined in Bankruptcy Code section 101(37), including, but not limited to, a “judicial
lien,” as that term is defined in Bankruptcy Code section 101(36), against any property of the
Estates, but only to the extent of the “value,” as determined by the Bankruptcy Court pursuant to
Bankruptcy Code section 506(a) and Bankruptcy Rule 3012, or as otherwise agreed to, of such
Creditor’s interest in the Debtor’s interest in such property.
1.112 “Voting Agent” means Stretto, which has been retained by the Debtors to perform
certain solicitation and other administrative services.
B. Rules of Interpretation
For purposes of the Plan: (a) where appropriate in the relevant context, each term,
whether stated in the singular or the plural, includes both the singular and the plural; (b) unless
otherwise provided in this Plan, any reference in this Plan to a contract, instrument, release,
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indenture or other agreement or document being in a particular form or on particular terms and
conditions means that such document will be substantially in such form or substantially on such
terms and conditions; (c) unless otherwise provided in this Plan, any reference in this Plan to an
existing document or appendix filed or to be filed means such document or appendix, as it may
have been or may be amended, modified, or supplemented under this Plan; (d) unless otherwise
specified herein, any reference to a Person as a holder of a Claim or Interest includes that
Person’s successors, assigns, and affiliates; (e) unless otherwise specified, all references in this
Plan to Sections and Articles are references to Sections and Articles of or to the Plan; (f) the
words “herein,” “hereto,” and “hereof” refer to this Plan in its entirety rather than to a particular
portion of the Plan; and (g) the rules of construction set forth in Bankruptcy Code section 102
will apply to the Plan. To the extent that this Plan is inconsistent with the Disclosure Statement,
unless such document specifically states otherwise, the provisions of the Plan shall control.
ARTICLE 2 - PAYMENT OF CLAIMS NOT REQUIRED TO BE CLASSIFIED
2.1 Claims Not Classified.
No Classes are designated for DIP Financing Claims, Administrative Expense Claims,
Professional Fee Claims, Priority Tax Claims, Non-Tax Priority Claims, or Intercompany
Claims.
2.2 DIP Financing Claims.
The DIP Financing Claims are Allowed in full. All Allowed DIP Financing Claims shall
be paid in full, in Cash on the Effective Date or as soon thereafter as reasonably practicable.
2.3 Administrative Expense Claims.
All Allowed Administrative Expense Claims shall be paid in full, in Cash in such
amounts as may be Allowed by the Bankruptcy Court (a) as soon as practicable following the
later of the Effective Date or the date upon which the Court enters a Final Order allowing any
such Administrative Expense Claim, (b) as otherwise provided in the Bankruptcy Code or
approved by the Bankruptcy Court, or (c) as agreed by the holder of any such Administrative
Expense Claim. If any Disputed Administrative Expense Claim exists on the Effective Date,
then the Liquidation Trustee shall hold and maintain Cash in the Disputed Confirmation Reserve
in an amount equal to all outstanding Disputed Administrative Expense Claims until such dispute
is resolved consensually or by Final Order.
2.4 Professional Fee Claims
All Allowed Professional Fee Claims shall be paid in full, in Cash in such amounts as
may be Allowed by the Bankruptcy Court (a) as soon as practicable following the later of the
Effective Date or the date upon which the Court enters a Final Order allowing any such
Professional Fee Claim, (b) as otherwise provided in the Bankruptcy Code or approved by the
Bankruptcy Court, or (c) as may be agreed upon between the holder of any such Professional Fee
Claim and the Debtors. If any Disputed Professional Fee Claim exists on the Effective Date,
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then the Liquidation Trustee shall hold and maintain Cash in the Professional Fee Escrow
Account in an amount equal to all outstanding Disputed Professional Fee Claims until such
dispute is resolved consensually or by Final Order.
2.5 Priority Tax Claims.
Unless otherwise agreed to by the parties, each holder of an Allowed Priority Tax Claim
will receive Cash of a total value, as of the Effective Date, equal to the Allowed amount of such
Priority Tax Claim either (a) in full on the Effective Date, or (b) in regular installment payments
over a period ending not later than five (5) years after the Petition Date, which treatment is not
less favorable than that provided to the General Unsecured Creditors, in accordance with
Bankruptcy Code section 1129(a)(9)(C); provided, however, that all Allowed Priority Tax
Claims that are not due and payable on or before the Effective Date shall be paid in the ordinary
course of business in accordance with the terms thereof. If any Disputed Priority Tax Claim
exists on the Distribution Date, then the Liquidation Trustee shall hold and maintain Cash in the
Disputed Confirmation Reserve in an amount equal to all outstanding Disputed Priority Tax
Claims until such dispute is resolved consensually or by Final Order.
2.6 Non-Tax Priority Claims.
Each holder of an Allowed Non-Tax Priority Claim will receive Cash on the Effective
Date of a total value, as of the Effective Date, equal to the full Allowed amount of such Non-Tax
Priority Claim; provided, however, that all Allowed Non-Tax Priority Claims that are not due
and payable on or before the Effective Date shall be paid in the ordinary course of business in
accordance with the terms thereof. If any Disputed Non-Tax Priority Claim exists on the
Distribution Date, then the Liquidation Trustee shall hold and maintain Cash in the Disputed
Confirmation Reserve in an amount equal to all outstanding Disputed Non-Tax Priority Claims
until such dispute is resolved consensually or by Final Order.
2.7 Intercompany Claims.
As a result of substantive consolidation of the Debtors for Distribution purposes under
the Plan, as provided in Section 5.2, holders of Intercompany Claims will not receive any
Distribution of property under the Plan on account of their Intercompany Claims and, on the
Effective Date, the Intercompany Claims will be cancelled.
ARTICLE 3 - CLASSIFICATION OF CLAIMS AND INTERESTS
3.1 Criterion of Class.
A Claim is in a particular Class only to the extent that the Claim qualifies within the
description of that Class, and is in a different Class or Classes to the extent that the remainder of
the Claim qualifies within the description of the different Class or Classes.
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3.2 Classification.
The Plan is premised on the substantive consolidation of the Debtors with respect to the
voting and treatment of all Claims and Interests, as provided below. The following summary is
for the convenience of all interested parties and is superseded for all purposes by the
classification, description, and treatment of Claims and Interests in ARTICLE 4 of the Plan.
3.3 Class Categories.
The following Classes of Claims and Interests are designated pursuant to and in
accordance with Bankruptcy Code section 1123(a)(1), which Classes shall be mutually
exclusive:
Class Class Designation Status/Voting Rights
Class 1A Allowed Other Secured Claims Unimpaired/Deemed to Accept
Class 1B Allowed Prepetition BP Secured Claim Impaired/Entitled to Vote
Class 2 Allowed General Unsecured Claims Impaired/Entitled to Vote
Class 3 Allowed BP Deficiency Claim and Allowed BP
Subordinated Claim
Impaired/Entitled to Vote
Class 4 Allowed Prepetition CBLIC Claims Impaired/Entitled to Vote
Class 5 Interests Impaired/Deemed to Reject
ARTICLE 4 - TREATMENT OF CLASSES OF CLAIMS AND INTERESTS
The following treatment of and consideration to be received by holders of Allowed
Claims and Interests under this Plan shall be in full settlement, release, and discharge of such
Allowed Claims and Interests.
4.1 Class 1A (Allowed Other Secured Claims).
Each holder of an Allowed Other Secured Claim shall receive on the Effective Date
(except to the extent that a holder of an Allowed Other Secured Claim agrees to less favorable
treatment): (i) Cash in an amount equal to such Other Secured Claim; (ii) return of the collateral
securing such Other Secured Claim; (iii) such other treatment that will render such Other
Secured Claim unimpaired under Bankruptcy Code section 1124; or (iv) such other treatment as
the Debtors and the applicable holder of an Allowed Other Secured Claim may agree. Any
Deficiency Claim that may arise on account of the present lack of collateral or otherwise
resulting from the aforesaid treatment shall be included in and treated as a Class 2 Allowed
General Unsecured Claim. For the avoidance of doubt, the Subordinate Lienholders and their
successors will not have Allowed Claims and their liens, if any, shall be released.
4.2 Class 1B (Allowed Prepetition BP Secured Claim).
Each holder of an Allowed Prepetition BP Secured Claim shall receive on the Effective
Date, or as soon as reasonably practicable thereafter, all of the following, but not including cash
in an amount necessary to pay or reserve for the Confirmation Amount: the return of proceeds
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from the sale of the Prepetition Collateral and any Prepetition Collateral, including, among other
things, the Posted Collateral, subject to Other Secured Claims. BP shall be deemed to (i) waive
any diminution Claim against the Debtors and their Estates under the Final DIP Order, and (ii)
release any lien it holds on (a) Briarcliff that is evidenced by a mortgage or otherwise, as well as
any lien on the Briarcliff Membership Interests, and (b) the Liquidation Trust Assets.
The aggregate Allowed amount of the Prepetition BP Secured Claim shall be the sum of
(i) [$ ]130,270,019.91 and (ii) the amount of any draws on Posted Collateral pursuant to the
Prepetition BP Secured Loan Documents, minus (y) any Adequate Protection Cash Payments (as
defined in the Final DIP Order) applied to the Prepetition BP Secured Claim prior to the
Effective Date, and (z) any collections on Guaranties net of the Guarantee Proceeds (defined
herein) paid to the Liquidation Trust.
In no event shall BP receive Distributions under the Plan that exceed the aggregate
Allowed amount of the Prepetition BP Secured Claim unless holders of General Unsecured
Claims have been paid in full. If BP receives Distributions under the Plan that exceed the
Allowed amount of the Prepetition BP Secured Claim before holders of General Unsecured
Claims are paid in full, BP shall remit any such excess amount to the Liquidation Trust, and such
amounts shall constitute Liquidation Trust Assets. In addition, if holders of Prepetition CBLIC
Claims receive Distributions under the Plan that are paid to BP pursuant to an intercreditor
agreement before holders of General Unsecured Claims are paid in full, then BP shall pay such
Distributions to the Liquidation Trust and such amounts shall constitute Liquidation Trust Assets
(the “CBLIC Intercreditor Proceeds”).
BP shall diligently pursue and attempt to collect on the Guaranties. BP shall provide
regular status updates to the Liquidation Trustee with respect to the pursuit and collection of the
Guaranties. Each time BP receives proceeds on account of the Guaranties (the “Guarantee
Proceeds”), BP shall pay, without recoupment or offset, 10% of the Guarantee Proceeds, net of
any expenses incurred in the collection thereof, to the Liquidation Trust no later than fourteen
(14) days after BP’s receipt of such Guarantee Proceeds. The amount of Guarantee Proceeds
transferred by BP to the Liquidation Trust shall constitute Liquidation Trust Assets and shall not
exceed $3 million.
4.3 Class 2 (Allowed General Unsecured Claims).
Each holder of an Allowed General Unsecured Claim shall receive one or more
Distributions equal to its Pro Rata share of the General Unsecured Creditor Interests as such
Distributions become available as is reasonably practicable in the reasonable discretion of the
Liquidation Trustee. The Liquidation Trust, in the Liquidation Trustee’s discretion, shall make
periodic Distributions of available Cash from the Liquidation Trust Assets to the holders of
General Unsecured Creditor Interests at any time after the Effective Date.
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4.4 Class 3 (Allowed BP Deficiency Claim and Allowed BP Subordinated
Claim).
Subject to Section 4.5, (i) the BP Deficiency Claim and the BP Subordinated Claim shall
be deemed Allowed and subordinated to Class 2 Allowed General Unsecured Claims, and (ii)
after all Allowed General Unsecured Claims are paid in full, each holder of an Allowed BP
Deficiency Claim and Allowed BP Subordinated Claim shall receive its Pro Rata share of the
proceeds of the Subordinated Creditor Fund as such funds become available as is reasonably
practicable in the reasonable discretion of the Liquidation Trustee.
4.5 Class 4 (Allowed Prepetition CBLIC Claims).
Upon the consent of the holder(s) of the Prepetition CBLIC Claims, such Prepetition
CBLIC Claims shall be deemed subordinated to the Class 2 General Unsecured Claims pursuant
to Bankruptcy Code section 510(c) or recharacterized as equity, and any liens purportedly
securing such Claims shall be released on the Effective Date. Absent the consent of the holder(s)
of the Prepetition CLBIC Claims and if the Prepetition CBLIC Claims are not subordinated or
recharacterized as equity as of the Effective Date and ultimately become Allowed Claims, such
Claims shall be deemed General Unsecured Claims and shall be treated in accordance with
Section 4.3 to the extent that such General Unsecured Claims become Allowed General
Unsecured Claims; provided, however, that pursuant to Bankruptcy Code 510(a) and that certain
Second Amended and Restated Intercreditor Agreement by and among BP, CBLIC, the
Subordinate Lienholders, and certain of the Debtors, dated February 9, 2018, any Allowed
Prepetition CBLIC Claims are contractually subordinated to the Prepetition BP Secured Claim
and the BP Subordinated Claim and shall not receive any distributions on account of such claims
until the BP Deficiency Claim and the Allowed BP Subordinated Claim have been paid in full.
4.6 Class 5 (Interests).
No holder of an Interest shall be entitled to a Distribution under the Plan on account of
such Interest. On the Effective Date, all Interests shall be retired, cancelled, extinguished, and/or
discharged.
ARTICLE 5 - MEANS OF IMPLEMENTATION OF THE PLAN
5.1 Joint Chapter 11 Plan.
The Plan is a joint chapter 11 plan for each Debtor, with the Plan for each Debtor being
non-severable and mutually dependent on the Plan for each Debtor.
5.2 Substantive Consolidation of Claims Against Debtors for Plan
Purposes Only.
The Plan is premised on the substantive consolidation of all of the Debtors with respect to
the treatment of all Claims and Interests, as provided below. The Plan shall serve as a request by
the Debtors, in lieu of a separate motion, to the Bankruptcy Court that it grant substantive
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consolidation with respect to the treatment of all Claims and Interests as follows. On the
Effective Date, (a) all Assets and liabilities of the Debtors will, solely for voting and Distribution
purposes, be merged or treated as though they were merged; (b) all guarantees of the Debtors of
the obligations of any other Debtor and any joint or several liability of any of the Debtors shall
be eliminated; (c) each and every Claim or Interest against any Debtor shall be deemed a single
Claim against, and a single obligation of, the Debtors and all Claims filed against more than one
Debtor for the same liability shall be deemed one Claim against any obligation of the Debtors;
and (d) all transfers, disbursements, and Distributions on account of Claims made by or on behalf
of any of the Debtors’ Estates hereunder will be deemed to be made by or on behalf of all of the
Debtors’ Estates. Holders of Allowed Claims entitled to Distributions under the Plan shall be
entitled to their share of Assets available for Distribution to such Claim without regard to which
Debtor was originally liable for such Claim. Except as set forth herein, such limited substantive
consolidation shall not (other than for purposes related to the Plan) affect the legal and corporate
structures of the Debtors.
5.3 Plan Funding Mechanism.
The Plan shall be funded from the Effective Date Cash and any other Assets of the
Estates, except as expressly set forth herein.
5.4 Formation of the Liquidation Trust.
On the Effective Date, the Liquidation Trust shall be formed pursuant to the Plan and
established and become effective in accordance with the Liquidation Trust Agreement to
liquidate the Liquidation Trust Assets, the Prepetition Collateral, and the Postpetition Collateral,
and to enable the Liquidation Trustee to distribute same in accordance with the Plan and the
Liquidation Trust Agreement. The Liquidation Trust shall be established for the sole purpose of
liquidating and distributing the Liquidation Trust Assets, the Prepetition Collateral, and the
Postpetition Collateral in accordance with Treasury Regulation section 301.7701-4(d), with no
objective to continue or engage in the conduct of a trade or business. On the Effective Date, the
Debtors shall transfer all of the Liquidation Trust Assets, the Prepetition Collateral, and the
Postpetition Collateral to the Liquidation Trust, subject only to the liens of Secured Creditors (as
may be modified in the Plan), and otherwise free and clear of liens, Claims, and Interests. On or
before the Effective Date, the Liquidation Trust Agreement shall be executed and, upon the
Effective Date, shall become effective without further action by any party.
The terms of the Liquidation Trust Agreement shall control as to all matters applicable to
the Liquidation Trust. To the extent there is any conflict between the Liquidation Trust
Agreement and the Plan, the Plan shall govern.
5.5 Establishment of Reserves and Escrow Accounts.
(a) At least three (3) days prior to the Confirmation Hearing, the Debtors shall
file with the Bankruptcy Court a notice that reflects the proposed amounts of the Confirmation
Fund.
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(b) Confirmation Fund. On the Effective Date, or as soon thereafter as is
practicable, the Liquidation Trustee shall establish the Confirmation Fund, which shall be funded
from the Effective Date Cash in an amount equal to the Confirmation Amount. The
Confirmation Fund shall be used to pay all Allowed Administrative Expense Claims, Allowed
Other Secured Claims, Allowed Priority Tax Claims, and Allowed Non-Tax Priority Claims.
Any amounts remaining in the Confirmation Fund, excluding the Initial Liquidation Trust
Funding and the GUC Budget Excess, after: (i) all Allowed Administrative Expense Claims,
Allowed Professional Fee Claims, Allowed Other Secured Claims, Allowed Priority Tax Claims,
and Allowed Non-Tax Priority Claims are satisfied in full; and (ii) the Disputed Confirmation
Reserve, the Professional Fee Escrow Account, the Disputed GUC Fund, and the Liquidation
Trust Expense Fund have been funded, shall become available for Distribution to the holder of
the Prepetition BP Secured Claim.
(c) Disputed Confirmation Reserve. As soon as practicable after the Effective
Date, the Liquidation Trustee shall establish the Disputed Confirmation Reserve, which shall be
funded on each Distribution Date from the Effective Date Cash in an amount equal to the
Distributions that would have been made to holders of Disputed Administrative Expense Claims,
Disputed Other Secured Claims, Disputed Priority Tax Claims, and Disputed Non-Tax Priority
Claims if such Claims were Allowed Claims in their full amounts or such lower amount as to
which the holder of such Claim has agreed in writing or, in the case where any such Claim is
unliquidated and/or contingent, the greater of (i) $1, and (ii) such other amount as is reserved by
order of the Bankruptcy Court made upon motion of the holder of such Claim. The Liquidation
Trustee shall remove funds from the Disputed Confirmation Reserve as Disputed Administrative
Expense Claims, Disputed Other Secured Claims, Disputed Priority Tax Claims, and Disputed
Non-Tax Priority Claims are resolved, which funds shall be distributed as provided in this Plan,
and any excess shall be returned to BP.
(d) Professional Fee Escrow Account. On the Effective Date, the Liquidation
Trustee shall establish a Professional Fee Escrow Account and shall fund such Professional Fee
Escrow Account with Effective Date Cash in an amount equal to the sum of the Professional Fee
Claims. The Professional Fee Escrow Account shall be maintained in trust for the Professionals.
Such funds shall not be considered property of the Debtors’ Estates and shall not vest with the
Liquidation Trustee or the Liquidation Trust. Any amounts remaining in the Professional Fee
Escrow Account after all Allowed Professional Fee Claims are paid shall become available for
Distribution to holders of Prepetition BP Secured Claim.
(e) Disputed GUC Fund. As soon as practicable after the Effective Date, the
Liquidation Trustee shall establish the Disputed GUC Fund, which shall be funded on each
Distribution Date from the Liquidation Trust Assets in an amount equal to the Distributions that
would have been made to holders of Disputed General Unsecured Claims if such Claims were
Allowed Claims or such lower amount as to which the holder of such Claim has agreed in
writing or, in the case where any such Claim is unliquidated and/or contingent, the greater of (i)
$1, and (ii) such other amount as is reserved by order of the Bankruptcy Court made upon
motion of the holder of such Claim. The Liquidation Trustee shall remove funds from the
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Disputed GUC Fund as Disputed General Unsecured Claims are resolved, which funds shall be
distributed as provided in this Plan.
(f) Liquidation Trust Expense Fund. On the Effective Date, or as soon
thereafter as is practicable, the Liquidation Trustee shall establish the Liquidation Trust Expense
Fund, the funding of which may include any Liquidation Trust assets; provided, however, that
the Liquidation Trust Expense Fund may not include more than $750,000 of the Initial
Liquidation Trust Funding. The Liquidation Trust Expense Fund shall be used to pay the
Liquidation Trust Expenses in accordance with the Liquidation Trust Agreement, including,
without limitation, costs and expenses of (i) counsel or other advisors retained by the Liquidation
Trustee, (ii) any liquidation or administration of the Liquidation Trust Assets, and (iii) the
prosecution of Causes of Action and Claims objections. Any amounts remaining in the
Liquidation Trust Expense Fund after all Liquidation Trust Expenses are paid shall become
available for Distribution to holders of Allowed General Unsecured Claims, the Allowed BP
Deficiency Claim, the Allowed BP Subordinated Claim, and any Allowed Prepetition CBLIC
Claims in the priority of payment provided for in accordance with the provisions of the Plan.
(g) Subordinated Creditor Fund. On the date upon which all unsubordinated
Allowed General Unsecured Claims have been satisfied in full, or as soon thereafter as is
reasonably practicable, the Liquidation Trustee shall establish the Subordinated Creditor Fund,
which shall be funded by the Liquidation Trust after satisfaction in full of all Allowed General
Unsecured Claims in accordance with this Plan. The Subordinated Creditor Fund shall be used
to pay the Allowed BP Deficiency Claim and the Allowed BP Subordinated Claim, in the
priority of payment provided for in accordance with the provisions of the Plan.
5.6 Powers and Duties of the Liquidation Trustee.
As of the Effective Date, the Liquidation Trustee shall be appointed under Bankruptcy
Code section 1123(b)(3)(B) and shall serve in such capacity and shall have comparable authority
as a bankruptcy trustee of the Debtors as the exclusive representative of the Estates or any
corresponding provision of federal or state laws and shall succeed to all of the Debtors’ and
Estates’ rights. The powers, rights, and responsibilities of the Liquidation Trustee, all of which
shall arise upon the occurrence of the Effective Date, shall be specified in the Liquidation Trust
Agreement and shall include, but not be limited to:
(a) collecting and liquidating the Liquidation Trust Assets under the
jurisdiction of the Bankruptcy Court;
(b) using commercially reasonable efforts to obtain the return of the
Prepetition Collateral to BP;
(c) asserting, prosecuting, objecting to, pursuing, compromising, and settling
in accordance with the Liquidation Trustee’s reasonable business judgment, all matters affecting
the Estates, including, without limitation, Disputed Claims and/or other Causes of Action related
thereto, to the extent set forth in the Liquidation Trust Agreement and except as provided therein,
without further order of the Bankruptcy Court;
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(d) asserting and enforcing all legal or equitable remedies and defenses
belonging to the Debtors or their Estates, including, without limitation, setoff, recoupment, and
any rights under Bankruptcy Code section 502(d);
(e) acting on behalf of the Debtors in all adversary proceedings and contested
matters then pending or that can be commenced in the Bankruptcy Court and in all actions and
proceedings pending or commenced elsewhere, and to settle, retain, enforce, dispute, or adjust
any Claim and otherwise pursue actions involving the Assets of the Debtors that could arise or be
asserted at any time under the Bankruptcy Code, unless otherwise waived, relinquished, or
transferred in the Plan;
(f) taking such actions the Liquidation Trustee deems appropriate in his or her
reasonable business judgment against any Person with respect to a Claim or Cause of Action and
commencing any process or proceeding in the Bankruptcy Court or in any court of competent
jurisdiction in accordance with applicable laws, to the extent set forth in the Liquidation Trust
Agreement;
(g) making Distributions to holders of all Allowed Claims, including
Professional Fee Claims, in accordance with the Plan and Liquidation Trust Agreement;
(h) proceeding with and employing all discovery devices permitted under
applicable law, including Rule 2004 of the Bankruptcy Rules, in order to investigate any Claims
or Causes of Action;
(i) employing, without further order of the Bankruptcy Court, professionals
or other Persons to assist it in carrying out its duties hereunder and under the Liquidation Trust
Agreement, and compensating and reimbursing the expenses of those professionals and other
Persons on the terms to be agreed to by the Liquidation Trustee and such professionals and other
Persons without further order of the Bankruptcy Court, to the extent set forth in the Liquidation
Trust Agreement;
(j) investing Cash in accordance with Bankruptcy Code section 345,
withdrawing and making Distributions of Cash to holders of Allowed Claims and paying taxes
and other obligations owed by the Debtors or incurred by the Liquidation Trustee from the
Liquidation Trust Expense Fund in accordance with the Plan;
(k) coordinating the turnover of property, if any, subject to rejected executory
contracts or abandonment or liquidation of any retained Assets and disposing of, and delivering
title to others of, or otherwise realizing value of, all the remaining Assets;
(l) overseeing compliance with the Debtors’ accounting, finance, and
reporting obligations and the filing of final tax returns, refund requests, audits, and other
corporate dissolution documents, if required;
(m) preparing financial statements and U.S. Trustee post-confirmation
quarterly reports, until such time such time as the Bankruptcy Court enters an order (i)
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dismissing the Bankruptcy Cases, (ii) converting the Bankruptcy Cases to cases under chapter 7
of the Bankruptcy Code, or (iii) approving a final decree closing the Bankruptcy Cases;
(n) paying all other expenses for winding down the affairs of the Debtors in
accordance with a wind down budget or as otherwise agreed to by the Liquidation Trustee, and
in the event of a dispute that cannot be resolved, resolving such dispute in the Bankruptcy Court,
subject to the terms of the Plan;
(o) executing and delivering all documents, and taking all actions, necessary
to consummate the Plan, implement the Liquidation Trust Agreement, and wind down the
Debtors’ business;
(p) implementing and/or enforcing all provisions of the Plan;
(q) asserting and/or waiving, as the Liquidation Trustee deems appropriate,
any attorney-client privilege or similar privilege belonging to any of the Debtors immediately
prior to the Effective Date of the Plan; and
(r) such other powers as may be vested in or assumed by the Liquidation
Trustee pursuant to the Liquidation Trust Agreement, Plan, other Bankruptcy Court order, or as
may be needed or appropriate to carry out the provisions of the Plan and Liquidation Trust
Agreement.
5.7 Appointment of the Liquidation Trustee.
The Liquidation Trustee shall be deemed the Estates’ sole representative in accordance
with Bankruptcy Code section 1123 and shall have all powers, authority, and responsibilities
specified in the Plan, including, without limitation, the powers of a trustee under Bankruptcy
Code sections 704 and 1106.
5.8 Issuance of General Unsecured Creditor Interests.
(a) General Unsecured Creditor Interests. On the Effective Date or as soon as
practicable thereafter, the Debtors shall deliver to the Liquidation Trustee a list of each Person to
receive General Unsecured Creditor Interests as of the Effective Date pursuant to the Plan,
including the Allowed amounts of the Claims of, and the address of, each such Person.
(b) Transfer of General Unsecured Creditor Interests. The Liquidation Trustee
shall maintain a register of the holders of General Unsecured Creditor Interests and shall adjust,
without further order of the Bankruptcy Court, the register from time to time as General
Unsecured Claims that are Disputed Claims become Allowed. To the extent permitted in the
Liquidation Trust Agreement, upon notice to the Liquidation Trustee by any holder of a General
Unsecured Creditor Interest, the Liquidation Trustee shall amend the register to reflect any
transfer of a General Unsecured Creditor Interest by such holder to a transferee as set forth in the
notice; provided, however, that the Liquidation Trustee need not reflect any transfer (or make
any distribution to any transferee) and will give notice to such holder that no transfer has been
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recognized in the event the Liquidation Trustee reasonably believes that such transfer (or the
distribution to such transferee) may constitute a violation of applicable laws or might cause the
Liquidation Trust to be required to register the General Unsecured Creditor Interests, or to
become a reporting company, under the Securities Exchange Act of 1934, as amended.
5.9 Liquidation Trustee Reporting.
The Liquidation Trustee shall prepare and file with the Court, and serve upon BP and the
U.S. Trustee, such reports as are required under Section 5.24, including quarterly reports,
beginning with the first full calendar quarter after the Effective Date, regarding the liquidation or
other administration of the Assets of the Estates, Distributions made by the Liquidation Trustee,
and the status of the prosecution or settlement of any Claims and Causes of Action. The
Liquidation Trustee shall pay fees of the U.S. Trustee as provided in Section 5.24.
5.10 Fees and Expenses of the Liquidation Trustee.
Except as otherwise ordered by the Bankruptcy Court or specifically provided for in the
Plan, the amount of Liquidation Trust Expenses and any compensation and expense
reimbursement Claims (including, without limitation, reasonable fees and expenses of counsel)
of the Liquidation Trustee arising out of the liquidation of the Assets of the Estates, the making
of Distributions under the Plan, and the performance of any other duties given to it shall be paid
from the Liquidation Trust Expense Fund and in accordance with the Liquidation Trust
Agreement; provided, however, that any fees or expenses (including legal) incurred by the
Liquidation Trustee in connection with collecting or recovering any Prepetition Collateral will be
netted against the proceeds collected therefrom.
5.11 Resignation or Removal of Liquidation Trustee.
If the Liquidation Trustee resigns or is removed, dissolves, or is incapacitated, the terms
of the Liquidation Trust Agreement shall govern regarding the designation of a successor
Liquidation Trustee, and following such designation, the successor Liquidation Trustee, without
further act, shall become fully vested with all of the rights, powers, duties, and obligations of his
or her predecessor, with the same compensation of the predecessor Liquidation Trustee. No
successor Liquidation Trustee shall in any event have any liability or responsibility for the acts
or omissions of any of his or her predecessors.
5.12 Reliance on Documents.
The Liquidation Trustee may rely, and shall be protected in acting or refraining from
acting, upon any certificates, opinions, statements, instruments or reports believed by it to be
genuine and to have been signed or presented by the proper entity, including, without limitation,
claims lists and data provided to the Liquidation Trustee by the Claims Agent, the Debtors, or the
Debtors’ financial advisor, upon which the Liquidation Trustee shall base Distributions.
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5.13 Corporate Action.
The Plan will be administered by the Liquidation Trustee and all actions taken under the
Plan in the name of the Debtors shall be taken through the Liquidation Trustee in accordance
with the provisions of the Plan and the Liquidation Trust Agreement.
5.14 Liquidation and Dissolution of Debtors.
On the Effective Date, without the necessity for any other or further action to be taken by
or on behalf of the Debtors, and upon the transfer of the Liquidation Trust Assets to the
Liquidation Trust and the Prepetition Collateral to BP in accordance with ARTICLE 5 of the
Plan, the members of the board of directors or managers, as the case may be, and the respective
officers, of each of the Debtors shall be deemed to have been removed, and each such Debtor
shall be deemed dissolved for all purposes unless the Liquidation Trustee determines that
dissolution can have any adverse impact on the Liquidation Trust Assets, the Prepetition
Collateral, or the Postpetition Collateral; provided, however, that neither the Debtors nor any
party released pursuant to ARTICLE 8 of the Plan shall be responsible for any liabilities that
may arise as a result of non-dissolution of the Debtors.
5.15 Dissolution of Creditors’ Committee.
On the Effective Date, the Creditors’ Committee shall be deemed to be dissolved and the
members of the Creditors’ Committee shall be released and discharged from all further authority,
duties, responsibilities, and obligations arising from or related to the Bankruptcy Cases and
Professionals retained by the Committee shall be released and discharged from all further
authority, duties, responsibilities, and obligations relating to the Debtors and the Bankruptcy
Cases; provided, however, that the foregoing shall not apply to any matters concerning (a) any
Professional Fee Claims held or asserted by any Professional retained by the Committee or
reimbursement of any reasonable and documented expenses of the Committee’s members
incurred in their capacity as such, (b) any appeal from the Confirmation Order, or (c) the
withdrawal of the Standing Motion pursuant to Section 5.29.
5.16 Closing of the Bankruptcy Cases.
After all Disputed Claims filed against the Debtors have become Allowed Claims or have
been Disallowed, and all Assets have been liquidated and converted into Cash (other than those
Assets that have been or may be abandoned), and such Cash has been distributed in accordance
with the Plan, or at such earlier time as the Liquidation Trustee deems appropriate, the
Liquidation Trustee shall seek authority from the Bankruptcy Court to close the Bankruptcy
Cases in accordance with the Bankruptcy Code and the Bankruptcy Rules.
5.17 Plan Distributions.
After the Effective Date, and subject to the establishment and funding of the Liquidation
Trust, the Confirmation Fund, Liquidation Trust Expense Fund, and Disputed Confirmation
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Reserve under Section 5.5 and as set forth in greater detail in ARTICLE 4, Distributions shall be
made by the Liquidation Trustee in accordance with ARTICLE 2, ARTICLE 4, and ARTICLE 9.
5.18 Preservation and Abandonment of Records.
The Debtors shall preserve for the benefit of the Liquidation Trustee all Retained
Information. After the Effective Date, the Liquidation Trustee shall preserve the Retained
Information until the date that is at least one (1) year following the closing of the Bankruptcy
Cases. On the Effective Date, the Debtors shall be permitted to abandon (with or without
destruction) any information that is not Retained Information.
5.19 General Disposition of Assets.
Pursuant to Bankruptcy Code section 1123(a)(5) and subject to the terms of the Plan, as
soon as is reasonably practicable after the Effective Date, the Liquidation Trustee shall sell or
otherwise dispose of, and liquidate to or otherwise convert to Cash, any non-Cash Assets in such
manner as the Liquidation Trustee shall determine in his judgment in consultation with the
Secured Creditors (to the extent any such Assets are collateral of the Secured Creditors), but in
no event shall the Liquidation Trustee be prevented from returning Assets that are collateral of a
Secured Creditor to such Secured Creditor in a commercially reasonable manner.
5.20 Final Administrative Expense Claims Bar Date.
The Confirmation Order shall establish that requests for payment of Administrative
Expense Claims that were not required to be filed and served by the First Administrative
Expense Claim Bar Date (or any other subsequent bar date established by the Bankruptcy Court
for Administrative Expense Claims), other than:
(a) an Administrative Expense Claim that has become an Allowed Administrative
Expense Claim on or before the Effective Date;
(b) an Administrative Expense Claim on account of fees and expenses incurred on or
after the Petition Date by ordinary course professionals retained by the Debtor pursuant to an
order of the Bankruptcy Court; or
(c) an Administrative Expense Claim arising out of the employment by the Debtor of
an individual in the ordinary course of business from and after the Petition Date, but only to the
extent that such Administrative Expense Claim is solely for outstanding wages, commissions,
accrued benefits, or reimbursement of business expenses;
must be filed and served on or before 5:00 p.m. (prevailing Eastern Time) on or before the first
Business Day after the fourteenth (14th) day after the Confirmation Date (the “Final
Administrative Expense Claims Bar Date”).
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Objections, if any, to a timely request for payment of an Administrative Expense Claim
must be filed and served on the Liquidation Trustee and the requesting party no later than ninety
(90) days after the Effective Date.
No payment or Distributions will be made on account of any Administrative Expense
Claim until such Claim becomes an Allowed Claim. Any Person asserting an Administrative
Expense Claim that was subject to the First Administrative Expense Claim Bar Date that did not
timely file and serve an application or motion seeking approval of such Administrative Expense
Claim shall be forever barred from asserting any such right to payment as against the Debtors,
the Estates, and the Liquidation Trust. Any Person asserting an Administrative Expense Claim
not subject to the First Administrative Expense Claim Bar Date that fails to file and serve an
application or motion seeking approval of the Administrative Expense Claim on or before the
Final Administrative Expense Claims Bar Date shall be forever barred from asserting any such
right to payment as against the Debtors, the Estates, and the Liquidation Trust.
5.21 Deadline for Filing Applications for Professional Fee Claims.
All parties seeking payment of Professional Fee Claims must file with the Bankruptcy
Court a final application and/or an application for payment of reasonable fees and expenses
under Bankruptcy Code section 503(b), as applicable, on or before the first Business Day after
the thirtieth (30th) day after the Effective Date (the “Fee Application Deadline”). Any
Professional failing to file and serve such final application or 503(b) motion on or before the Fee
Application Deadline shall be forever barred from asserting any such right to payment against
the Debtors or the Estates. Objections to such Professional Fee Claims, if any, must be filed and
served no later than fifty (50) days after the Effective Date.
5.22 Execution of Documents to Effectuate Plan.
From and after the Effective Date, the Liquidation Trustee shall have the exclusive power
and authority to execute any instrument or document to effectuate the provisions of the Plan.
Entry of the Confirmation Order shall authorize the Debtors and the Liquidation Trustee to take,
or cause to be taken, all actions necessary or appropriate to consummate and implement the
provisions of the Plan.
5.23 Disallowance of Claims Without Further Order of the Court.
As of the Effective Date, any Scheduled Claim designated as disputed, contingent, or
unliquidated in amount and for which a proof of Claim has not been filed by the Creditor by the
applicable Bar Date shall be deemed Disallowed and expunged. All Scheduled Claims that
correspond to a proof of Claim filed by a particular Creditor by the applicable Bar Date shall be
deemed to have been superseded by such later filed proof of Claim, and the Scheduled Claim,
regardless of priority, shall be expunged from the Claims register; provided however, that such
proofs of Claim shall be subject to objection in accordance with Section 9.10.
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5.24 Post-Effective Date Reports and Fees.
Following the Effective Date and until the Bankruptcy Cases are closed, not less than
once every one-hundred and eighty (180) days, the Liquidation Trustee shall be responsible for
the filing of all post-Effective Date reports required during such periods with the U.S. Trustee
regarding the liquidation or other administration of property under the Liquidation Trustee’s
control pursuant to the Plan, Distributions made by the Liquidation Trustee, and other matters
required to be included in such report, and shall pay from the Liquidation Trust Expense Fund all
post-Effective Date fees charged or assessed against the Estate under 28 U.S.C. §1930 during
such periods together with applicable interest pursuant to 31 U.S.C. § 3717. Notwithstanding
any substantive consolidation of the Debtors under the Plan, each and every Debtor and the
Liquidation Trustee shall remain obligated to pay quarterly fees to the U.S. Trustee until the
particular Debtor’s case has been closed, dismissed, or converted to a case under chapter 7 of the
Bankruptcy Code.
5.25 Cancellation of Notes, Instruments, Certificates, and Other
Documents.
Except as expressly provided herein, on the Effective Date, all notes, instruments,
certificates evidencing debt of, or Interests in, the Debtors and any warrants, options, and other
entitlements to purchase and/or receive Interests in the Debtors, shall be deemed surrendered and
cancelled and any obligation of the Debtors thereunder shall be discharged; provided, however,
that the liens in favor of BP under the Final DIP Order and the Prepetition BP Secured Loan
Documents shall remain attached and fully perfected against the Postpetition Collateral and the
Prepetition Collateral (other than the Liquidation Trust Assets) until the repayment in full of the
DIP Financing Claims and the return of the Postpetition Collateral and the Prepetition Collateral
(other than the Liquidation Trust Assets) to BP.
5.26 Insurance Preservation.
Nothing in the Plan, the Confirmation Order, or the Liquidation Trust Agreement, alters
the rights and obligations of the Debtors (and their Estates) and the Debtors’ insurers (and third-
party claims administrators) under the Insurance Policies or modifies the coverage or benefits
provided thereunder or the terms and conditions thereof or diminishes or impairs the
enforceability of the Insurance Policies. All of the Debtors’ rights and their Estates’ rights under
any Insurance Policy to which the Debtors and/or the Debtors’ Estates may be beneficiaries shall
vest with the Liquidation Trust for the benefit of the Beneficiaries of the Liquidation Trust and
all of the beneficiaries of such policies. For the avoidance of doubt, the Debtors are deemed to
have assumed all of the Insurance Policies.
5.27 Preservation of Causes of Action.
Except as otherwise provided in this Plan or in any contract, instrument, release, or
agreement entered into in connection with the Plan and the Final DIP Order, in accordance with
Bankruptcy Code section 1123(b), all Claims and Causes of Action that the Debtors or Estates
may have against any Person or Entity are preserved and transferred to the Liquidation Trustee
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on the Effective Date, including, without limitation, any and all Causes of Action the Debtors,
Estates, or other appropriate party in interest may assert under Bankruptcy Code sections 502,
510, 522(f), 522(h), 542, 543, 544, 545, 547, 548, 549, 550, 551, 553 and 724(a).
5.28 Section 1146 Exemption from Certain Taxes and Fees
Pursuant to and to the extent set forth in Bankruptcy Code section 1146(a), any issuance,
transfer, or exchange of a security, or the making or delivery of an instrument of transfer of
property, pursuant to or in connection with this Plan shall not be subject to any Stamp or Similar
Tax or governmental assessment in the United States or by any other Governmental Unit, and the
Confirmation Order shall direct the appropriate federal, state or local (domestic or foreign)
governmental officials or agents to forgo the collection of any such Stamp or Similar Tax or
governmental assessment and to accept for filing and recordation instruments or other documents
evidencing such action or event without the payment of any such Stamp or Similar Tax or
governmental assessment. Such exemption specifically applies, without limitation, to all actions,
agreements and documents necessary to evidence and implement the provisions of, transactions
contemplated by and the distributions to be made under this Plan.
5.29 Withdrawal of the Standing Motion.
Within three (3) business days after the Effective Date, the Committee shall file a notice
of withdrawal of the Standing Motion.
5.30 Settlement Pursuant to Bankruptcy Rule 9019.
Pursuant to Bankruptcy Code section 1123 and Bankruptcy Rule 9019, the Plan
incorporates a compromise and settlement of various potential Claims and Causes of Action,
including those for which the Committee sought standing to bring pursuant to the Standing
Motion. The settlement of those potential Claims and Causes of Action is a cornerstone of the
Plan and necessary to achieve a beneficial and efficient resolution of the Chapter 11 Cases for all
parties in interest. The Plan shall be deemed to constitute a motion pursuant to Bankruptcy Rule
9019, seeking approval of a settlement, and the entry of the Confirmation Order shall constitute
the Bankruptcy Court’s approval of such motion, and the Bankruptcy Court’s findings shall
constitute its determination that such compromises and settlements encompassed in the Plan are
within the range of reasonableness, in the best interests of the Debtors, their Estates, their
Creditors, and other parties-in-interest, and fair and equitable.
5.31 Return of Deposits.
Unless the Debtors have agreed otherwise in a written agreement or stipulation approved
by the Bankruptcy Court, all security deposits, including Posted Collateral, provided by the
Debtors to any Entity at any time shall be returned to the Liquidation Trustee within twenty (21)
days after the Effective Date, without deduction or offset of any kind.
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ARTICLE 6- TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED
LEASES
6.1 General Provisions.
All executory contracts and unexpired leases of the Debtors shall be deemed rejected as
of the Effective Date, unless a particular executory contract or unexpired lease (i) has previously
been assumed or rejected pursuant to an order of the Bankruptcy Court or applicable provisions
of the Bankruptcy Code, (ii) has expired or otherwise terminated pursuant to its terms, or (iii) is
the subject of a separate assumption motion filed by one of the Debtors (with the consent of the
Committee and BP) under Bankruptcy Code section 365.
6.2 Notice of Deemed Rejection/Rejection Bar Date.
Any party to an executory contract or unexpired lease that is rejected in accordance with
Section 6.2 shall file a proof of Claim for damages from such rejection no later than thirty (30)
days after the Effective Date. The failure to timely file a proof of Claim shall be deemed a
waiver of any Claim in connection with the rejection of such contract or lease.
ARTICLE 7 - CONDITIONS PRECEDENT; CONFIRMATION AND EFFECTIVE
DATE
7.1 Conditions Precedent to Plan Confirmation.
The following conditions must be satisfied or waived by the Debtors, with the consent of
BP and the Committee, in accordance with Section 7.3 on or before the Confirmation Date:
(a) The Disclosure Statement Order shall have been entered by the
Bankruptcy Court and shall have become a Final Order; and
(b) The Confirmation Order to be entered by the Bankruptcy Court shall
contain provisions that, among other things: (i) authorize the implementation of the Plan in
accordance with its terms; (ii) approve in all respects the other settlements, transactions, and
agreements to be effectuated under the Plan; (iii) find that the Plan complies with all applicable
provisions of the Bankruptcy Code, including that the Plan was proposed in good faith and that
the Confirmation Order was not procured by fraud; (iv) order that the Assets of the Estates are
transferred to the Liquidation Trustee on the Effective Date, free and clear of all Claims, liens,
Encumbrances and interests of any Entity except for the liens and security interests of the
Secured Creditors; and (v) order that the Liquidation Trustee is authorized to take any and all
action necessary or appropriate to perform his duties hereunder.
7.2 Conditions Precedent to the Effective Date.
The Effective Date shall not occur and no obligations under the Plan shall come into
existence unless each of the following conditions is met or, alternatively, is waived in accordance
with Section 7.3:
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(a) The Confirmation Order shall have become a Final Order and such order
shall not have been amended, modified, vacated, stayed, or reversed;
(b) All requisite filings with governmental authorities and third parties, to the
extent required, shall have become effective;
(c) All documents contemplated by this Plan to be executed and delivered on
or before the Effective Date shall have been executed and delivered;
(d) The Liquidation Trustee shall have been designated by the Committee,
after consultation with BP, and shall be empowered to take all actions as contemplated by this
Plan and the Liquidation Trustee Agreement; and
(e) The Confirmation Fund, Professional Fee Escrow Account, Initial
Liquidation Trust Funding, Liquidation Trust Expense Fund, and Disputed Confirmation Reserve
shall be fully funded as may be applicable.
7.3 Waiver of Conditions Precedent.
Each condition precedent in Sections 7.1 and 7.2, except the condition precedent in
Section 7.2(a), may be waived or modified by the Debtors, with the written consent of BP and
the Committee, without further Court approval, in whole or in part. The condition precedent in
Section 7.2(a) shall be waived or modified by the Debtors, upon written direction from BP and
the Committee, without further Court approval.
ARTICLE 8 - INJUNCTION; RELEASE; EXCULPATION
8.1 General Injunctions.
The following provisions shall apply and shall be fully set forth in the Confirmation
Order.
(a) Injunctions Against Interference with Consummation or
Implementation of Plan. All holders of Claims or Interests shall be enjoined from
commencing or continuing any judicial or administrative proceeding or employing any
process against any of the Debtors or the Estates with the intent or effect of interfering with
the consummation or implementation of the Plan or the transfers, payments or
Distributions to be made hereunder.
(b) Plan Injunction. Except as otherwise specifically provided for by this
Plan, on and after the Effective Date, all Persons shall be enjoined from (i) the
enforcement, attachment, collection, or recovery by any manner or means of any judgment,
award, decree, or order; (ii) the creation, perfection, or enforcement of any Encumbrance
of any kind; (iii) the commencement or continuation of any action, employment of process
or act to collect, offset, or recover any Claim or Cause of Action satisfied, released, or
enjoined under this Plan; and/or (iv) the assertion of any right of setoff, counterclaim,
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exculpation, or subrogation of any kind, in each case against the Debtors or the Estates to
the fullest extent authorized or provided by the Bankruptcy Code.
(c) No Bar to Claims Against Third Parties. Holders of Claims or
Interests against the Debtors are not barred or otherwise enjoined by the Plan from
pursuing any recovery against Persons that are not the Debtors, except as set forth in this
Article 8.
8.2 All Distributions Received in Full and Final Satisfaction.
Except as otherwise set forth herein, all payments and all Distributions to be made in
accordance with the Plan on account of Claims (including Administrative Expense Claims) shall
be received in full and final satisfaction, settlement, and release of the Estates’ obligations for
such Claims as against the Debtors and their property and the Estates.
8.3 No Modification of Res Judicata Effect.
The provisions of this Article 8 are not intended, and shall not be construed, to modify
the res judicata effect of any order entered in the Bankruptcy Cases, including, without
limitation, the Confirmation Order and any order finally determining Professional Fee Claims to
any Professional.
8.4 Exculpation for Debtors, Committee, and Estate Professionals.
To the extent permitted by Bankruptcy Code section 1125(e), the Debtors, their
equity holders, officers, directors, employees and Professionals (including the professional
firms and individuals within such firms), and the Creditors’ Committee and its members
(acting in such capacity), their respective officers, directors, employees and Professionals
(including professional firms and individuals within such firms) shall neither have nor
incur any liability to any Person for any act taken or omitted to be taken in connection with
or related to the formulation, preparation, dissemination, implementation, administration,
funding, confirmation, or consummation of the Plan, the Disclosure Statement, or any
contract, instrument, release or other agreement or document created or entered into in
connection with the Plan, or any act taken or omitted to be taken during the Bankruptcy
Cases, except for acts or omissions as a result of willful misconduct or gross negligence as
determined by a Final Order of a court of competent jurisdiction, and in all respects shall
be entitled to rely reasonably upon the advice of counsel with respect to their duties and
responsibilities under the Plan. From and after the Effective Date, a copy of the
Confirmation Order and the Plan shall constitute, and may be submitted as, a complete
defense to any Claim or liability released under the Plan.
8.5 Exculpation for Liquidation Trustee.
The Liquidation Trustee and its employees, attorneys, accountants, financial
advisors, representatives, and agents, each solely in such capacity, shall not have or incur
any liability to any Person or Entity for any act or omission in connection with, or arising
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out of, the Plan or the property to be distributed under the Plan; except for acts or
omissions as a result of willful misconduct or gross negligence as determined by a Final
Order of a court of competent jurisdiction.
8.6 Releases by the Debtors.
Effective as of the Effective Date, without in any manner limiting or altering any
releases granted to the Postpetition Secured Party and Senior Lien Secured Party under
the Final DIP Order, each Debtor on behalf of itself and its Estate, each of their respective
affiliates, and each of their respective former, current, or future officers, employees,
directors, agents, representatives, owners, members, partners, financial advisors, legal
advisors, shareholders, managers, consultants, accountants, attorneys, affiliates, and
predecessors in interest, for good and valuable consideration provided by each of the
Released Parties, shall be deemed to provide a full release to each of the Released Parties
(and each such Released Party shall be deemed released by each Debtor and its Estate) and
their respective property from any and all Causes of Action and any other debts,
obligations, rights, suits, damages, actions, derivative Claims, remedies, and liabilities
whatsoever, whether known or unknown, foreseen or unforeseen, existing as of the
Effective Date, in law, at equity, or otherwise, whether for tort, contract, violations of
federal or state securities laws, or otherwise, based in whole or in part upon any act or
omission, transaction, or other occurrence or circumstance existing or taking place prior to
or on the Effective Date arising from or related in any way to the Debtors, the Plan,
Briarcliff, the Debtors’ out-of-court restructuring efforts, the Bankruptcy Cases, the
Postpetition Supply Facility, the Postpetition Transaction Documents, and the Senior Lien
Transaction Documents (as defined in the Final DIP Order) or any matters arising under
or in connection with the same, including those that the Debtors would have been legally
entitled to assert or that any holder of a Claim against or Interest in the Debtors, or any
other Entity could have been legally entitled to assert derivatively or on behalf of the
Debtors or their Estates; provided, however, that the foregoing Debtor Release shall not
operate to waive or release any Claims or causes of action of the Debtors or their Estates
for actual fraud or fraud grounded in deliberate recklessness. For the avoidance of doubt,
any Claims in respect of Avoidance Actions against the Released Parties shall be released.
Nothing in the foregoing shall result in any current directors and officers of the Debtors
waiving any indemnification Claims against the Debtors or any of their insurance carriers
or any rights as beneficiaries of any insurance policies.
Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval,
pursuant to Bankruptcy Rule 9019, of the Debtor Release, which includes by reference
each of the related provisions and definitions contained in the Plan, and further, shall
constitute the Bankruptcy Court’s finding that the Debtor Release is: (1) in exchange for
the good and valuable consideration provided by the Released Parties; (2) a good-faith
settlement and compromise of the Claims released by the Debtor Release; (3) in the best
interests of the Debtors’ Estates and all holders of Claims and Interests; (4) fair, equitable,
and reasonable; (5) given and made after due notice and opportunity for hearing; and (6) a
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bar to any of the Debtors’ Estates or the Liquidation Trustee asserting any Claim or Cause
of Action released under the Debtor Release.
8.7 Releases by Releasing Parties.
Effective as of the Effective Date, the Releasing Parties shall be deemed to provide a
full release to the Released Parties and their respective property from any and all Causes of
Action and any other debts, obligations, rights, suits, damages, actions, derivative Claims,
remedies, and liabilities whatsoever, whether known or unknown, foreseen or unforeseen,
existing as of the Effective Date, in law, at equity, or otherwise, whether for tort, contract,
violations of federal or state securities laws, or otherwise, based in whole or in part upon
any act or omission, transaction, or other occurrence or circumstance existing or taking
place prior to or on the Effective Date arising from or related in any way to the Debtors,
the Plan, Briarcliff, the Debtors’ out-of-court restructuring efforts, the Bankruptcy Cases,
the Postpetition Supply Facility, the Postpetition Transaction Documents, and the Senior
Lien Transaction Documents (as defined in the Final DIP Order) or any matters arising
under or in connection with the same, including those that the Debtors would have been
legally entitled to assert or that any holder of a Claim against or Interest in the Debtors or
any other Entity could have been legally entitled to assert derivatively or on behalf of the
Debtors or their Estates.
Entry of the Confirmation Order shall constitute the Bankruptcy Court’s approval,
pursuant to Bankruptcy Rule 9019, of the Third Party Release, which includes by reference
each of the related provisions and definitions contained in the Plan, and further, shall
constitute the Bankruptcy Court’s finding that the Third Party Release is: (1) in exchange
for the good and valuable consideration provided by the Released Parties; (2) a good-faith
settlement and compromise of the Claims released by the Third Party Release; (3) in the
best interests of the Debtors’ Estates and all holders of Claims and Interests; (4) fair,
equitable, and reasonable; (5) given and made after due notice and opportunity for
hearing; and (6) a bar to any of the Releasing Parties asserting any Claim released under
the Third Party Release.
Nothing in this Section 8.7 shall release any right or obligation of any party under
any other provision of this Plan or the Confirmation Order.
ARTICLE 9 - PROVISIONS GOVERNING DISTRIBUTIONS
9.1 Payment in U.S. Dollars.
All Cash payments required under the Plan shall be made in U.S. dollars by checks drawn
on a domestic bank selected by the Liquidation Trustee in accordance with the Plan or by wire
transfer from a domestic bank, at the option of the Liquidation Trustee. The Liquidation Trustee
may use the services of a third party to aid in the Distributions required to be made under this
Plan.
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9.2 Distributions Only on Business Days.
Notwithstanding the foregoing provisions, if any Distribution under this Plan is due on a
day other than a Business Day, such Distribution shall instead be made the next Business Day.
9.3 Unclaimed Distributions.
Unclaimed Distributions shall be canceled (by a stop payment order or otherwise), the
Claim(s) relating to such Distribution(s) shall be deemed forfeited and expunged without any
further action or order of the Bankruptcy Court, and the holder of such Claim(s) shall be
removed from the Distribution schedules and expunged from the Claims register and shall
receive no further Distributions under the Plan. Any such Unclaimed Distributions shall, as soon
as is practicable, be redistributed pursuant to the provisions of the Plan.
9.4 Timing of Distributions Generally.
The first Distribution shall occur as soon as practicable on or after the Effective Date. To
the extent subsequent Distributions are necessary, such subsequent Distributions shall occur as
soon after the first Distribution Date as the Liquidation Trustee shall reasonably determine is
appropriate in light of (i) the amount of Cash on hand; (ii) the amount and nature of Disputed
Claims; (iii) the activities to be accomplished, including their anticipated duration and costs; (iv)
the length of time since any prior Distribution; and (v) the costs of effecting any interim
Distribution.
9.5 Timing of Distributions on Disputed Claims Subsequently Allowed.
If a Disputed Claim is Allowed, in whole or in part, after the Effective Date, a
Distribution shall be made on account of such Allowed Claim on the next Distribution Date that
is at least fifteen (15) Business Days after such Claim is Allowed.
9.6 No Payment or Distribution on Disputed Claims.
Any contrary provision hereof notwithstanding, no payments or other Distributions shall
be made on account of any Disputed Claim, or any portion thereof, unless and until such Claim
is Allowed by Final Order. For the avoidance of doubt, no portion of any Disputed Claim is
entitled to a Distribution. Holders of Disputed Claims shall be bound, obligated, and governed in
all respects by this Plan.
9.7 Disputed Distribution.
If a dispute arises as to the identity of a holder of an Allowed Claim who is to receive a
Distribution, the Liquidation Trustee may, in lieu of making such Distribution to such holder,
hold such amount until the dispute is resolved by Final Order or by written agreement among the
parties to such dispute.
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9.8 Transmittal of Payments and Notices.
All Distributions shall be made to the holder of a Claim by regular first-class mail,
postage prepaid, in an envelope addressed to such holder at the address listed on its proof of
Claim filed with the Claims Agent or Bankruptcy Court or, if no proof of Claim was filed, (i) at
the address listed on the Debtors’ Schedules, or (ii) at such address that a holder of a Claim
provides to the Debtors and the Liquidation Trustee after the Effective Date in writing and files
at least fifteen (15) Business Days prior to a Distribution Date. Neither the Debtors nor the
Liquidation Trustee shall have any duty to ascertain the mailing address of any holder of a Claim
other than as set forth herein. The date of payment or delivery shall be deemed to be the date of
mailing. Payments made in accordance with the provisions of this Section 9.8 shall be deemed
made to the holder regardless of whether such holder actually receives the payment.
9.9 Record Date for Distributions.
Except as otherwise provided in a Final Order, transferees of Claims that are transferred
pursuant to Bankruptcy Rule 3001 with appropriate filings made on or before the Effective Date
(the “Record Date”) shall be treated as the holders of those Claims for all purposes,
notwithstanding that any period provided by Bankruptcy Rule 3001 for objecting to the
transfer(s) may not have expired prior to the Record Date. The Debtors and the Liquidation
Trustee shall have no obligation to recognize any transfer of any Claim occurring after the
Record Date. In making a Distribution with respect to any Claim, the Debtors and the
Liquidation Trustee shall be entitled to recognize and deal for all purposes hereunder only with
the Person who is listed on the proof of Claim filed with respect to such Claim, on the Debtors’
Schedules as the holder thereof, and upon such other evidence or record of transfer or assignment
filed as of the Record Date.
9.10 Claims Administration Responsibility.
(a) Reservation of Rights. Unless a Claim is specifically Allowed prior to or
after the Effective Date or under the Plan, the Liquidation Trustee reserves any and all objections
to any and all Claims and motions or requests for the payment of Claims, whether administrative
expense, secured or unsecured, including, without limitation, any and all objections to the
validity or amount of any and all alleged DIP Financing Claims, Administrative Expense Claims,
Priority Tax Claims, or Non-Tax Priority Claims, liens and security interests, whether under the
Bankruptcy Code, other applicable law or contract. The failure to object to any Claim prior to
the Effective Date shall be without prejudice to the Liquidation Trustee’s rights to contest or
otherwise defend against such Claim in the Bankruptcy Court when and if such Claim is sought
to be enforced by the holder of the Claim.
(b) Objections to Claims. The Liquidation Trustee may dispute, object to,
compromise, or otherwise resolve all Claims. Unless otherwise provided in the Plan or ordered
by the Bankruptcy Court, all objections to Claims shall be filed and served no later than the
Claims Objection Bar Date, provided that the Liquidation Trustee may request (and the
Bankruptcy Court may grant) an extension of time by filing a motion with the Bankruptcy Court.
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(c) Filing Objections. An objection to a Claim shall be deemed properly
served on the claimant if the Liquidation Trustee causes service of any such objection to be
effected in accordance with Bankruptcy Rule 3007 by mailing or otherwise delivering the
objection and a notice of hearing thereon to the claimant at the address set forth on such
claimant’s proof of Claim at least thirty (30) days prior to the hearing thereon.
(d) Determination of Claims. Except as otherwise agreed by the Debtors, any
Claim as to which a proof of Claim or motion or request for payment was timely filed in the
Bankruptcy Cases may be determined and liquidated after the Effective Date pursuant to (i) a
Final Order, or (ii) applicable non-bankruptcy law. Any Claim determined to be an Allowed
Claim after the Effective Date under this Section 9.10(d) shall be treated as an Allowed Claim in
accordance with this Plan.
9.11 Disputed Claims.
(a) For purposes of effectuating the provisions of the Plan and the
Distributions to holders of Allowed Claims, the Court, on or prior to the Effective Date, or
thereafter upon the request of any holder of a Claim or the Liquidation Trustee, may liquidate the
amount of Disputed Claims pursuant to Bankruptcy Code section 502(c), in which event the
amounts so fixed or liquidated shall be deemed to be the aggregate amounts of the Disputed
Claims under Bankruptcy Code section 502(c) for purposes of Distribution under this Plan and
for purposes of the Disputed Confirmation Reserve and Disputed GUC Fund.
(b) When a Disputed Claim becomes an Allowed Claim, there shall be
distributed to the holder of such Allowed Claim, in accordance with the provisions of the Plan
(but in no event later than the next succeeding Distribution Date), Cash in the amount of all
Distributions to which such holder would have been entitled if such holder’s Claim were
Allowed on the Effective Date, to the extent of available Cash to make such Distribution.
(c) In no event shall any holder of any Disputed Claim be entitled to receive
(under this Plan or otherwise) any Cash payment that is greater than the amount reserved, if any,
for such Disputed Claim under the Plan. In no event shall the Debtors or the Liquidation Trustee
have any responsibility or liability for any loss to or of any amount reserved under this Plan
unless such loss is the result of that party’s fraud, willful misconduct, or gross negligence. In no
event may any Creditor whose Disputed Claim is subsequently Allowed pursue or recover from
any other Creditor any funds received as Distributions under the Plan.
(d) To the extent that a Disputed Claim ultimately becomes an Allowed Claim
and is entitled to a Distribution in an amount less than the amount reserved for such Disputed
Claim, then on the next succeeding Distribution Date, the Liquidation Trustee shall make, in
accordance with the terms of the Plan, a Distribution of the excess amount reserved for such
Disputed Claim in accordance with the Plan.
(e) The Disputed Confirmation Reserve and the Disputed GUC Fund shall be
treated as disputed ownership funds, within the meaning of Treasury Regulation section 1.468B-
9, for all purposes associated with taxation.
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(f) Except as expressly set forth in the Plan, or otherwise agreed to in writing
or ordered by the Court, the Liquidation Trustee shall not have any duty to fund the Disputed
Confirmation Reserve or the Disputed GUC Fund.
(g) The Liquidation Trustee shall pay, or cause to be paid, out of the funds
held in the Disputed Confirmation Reserve and the Disputed GUC Fund, any tax imposed by any
federal, state, or local taxing authority on the income generated by the funds or property held in
the Disputed Confirmation Reserve and Disputed GUC Fund, respectively. The Liquidation
Trustee shall file, or cause to be filed, any tax or information return related to the Disputed
Confirmation Reserve and the Disputed GUC Fund that is required by any federal, state, or local
taxing authority.
9.12 No Payments of Fractional Cents or Distributions of Less Than
Thirty-Five Dollars.
(a) Any contrary provision hereof notwithstanding, for purposes of
administrative convenience, no payment of fractional cents shall be made pursuant to the Plan.
Whenever any payment of a fraction of a cent under the Plan would otherwise be required, the
actual Distribution made shall reflect a rounding of such fraction to the nearest whole penny (up
or down), with halfpennies or less being rounded down and fractions in excess of half of a penny
being rounded up.
(b) Any contrary provision hereof notwithstanding, for purposes of
administrative convenience, no Distribution of less than thirty-five dollars ($35) shall be made
pursuant to the Plan. Whenever any Distribution of less than thirty-five dollars ($35) under the
Plan would otherwise be required, such funds will be retained by the Liquidation Trustee for the
account of the recipient until such time that successive Distributions aggregate to thirty-five
dollars ($35), at which time such payment shall be made, and if successive Distributions do not
ever reach thirty-five dollars ($35) in the aggregate, then such Distributions shall be returned to
the Liquidation Trust.
9.13 Setoff and Recoupment. Except as otherwise provided in the Plan, the
Liquidation Trustee may, but shall not be required to, set off against, or recoup from, any Claim
and the Distributions to be made pursuant to the Plan in respect thereof, any Claims, defenses or
Causes of Action of any nature whatsoever that the Debtors may have, but neither the failure to
do so nor the allowance of any Claim under the Plan shall constitute a waiver or release by the
Debtors or Liquidation Trustee of any right of setoff or recoupment against the holder of any
Claim.
9.14 Payment of Taxes on Distributions Received Pursuant to the Plan.
(a) As a precondition to payment of any Distribution to a Creditor under this
Plan, unless included on the official proof of Claim form filed by such Creditor in the
Bankruptcy Cases, each Creditor shall provide the Liquidation Trustee a valid tax identification
or social security number (collectively, the “Tax Information”) for purposes of tax reporting by
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the Debtors. All Entities that receive Distributions under the Plan shall be responsible for
reporting and paying, as applicable, any taxes on account of their Distributions.
(b) At such time as the Debtors or Liquidation Trustee believe that
Distributions to a particular Class of Claims are likely, the Liquidation Trustee shall request Tax
Information in writing from the Creditors (the “Tax Information Request”). Any Creditor who
fails to respond to the Tax Information Request within ninety (90) days from the date posted on
the Tax Information Request shall forfeit all Distributions such Creditor may otherwise be
entitled to under this Plan, and such forfeited funds will revert to the Estates to be disbursed in
accordance with the terms and priorities established in this Plan.
9.15 Compliance With Tax Withholding and Reporting Requirements.
With respect to all Distributions made under the Plan, the Debtors and Liquidation
Trustee will comply with all withholding and reporting requirements of any federal, state, local,
or foreign taxing authority.
ARTICLE 10 - PLAN INTERPRETATION, CONFIRMATION AND VOTING
10.1 Procedures Regarding Objections to Designation of Classes as
Impaired or Unimpaired.
If the designation of the treatment of a Class as impaired or unimpaired is objected to, the
Bankruptcy Court shall determine the objection, and voting shall be permitted or disregarded in
accordance with the determination of the Bankruptcy Court.
10.2 Withdrawal and Modification of Plan.
This Plan may be withdrawn or modified by the Debtors at any time prior to the
Confirmation Date. The Debtors may modify the Plan, with the consent of BP and the
Committee, in any manner consistent with Bankruptcy Code section 1127 prior to substantial
consummation thereof. Upon request by the Liquidation Trustee, and with the consent of BP, the
Plan may be modified after substantial consummation with the approval of the Bankruptcy
Court, provided that such modification does not affect the essential economic treatment of any
Person that objects in writing to such modification.
10.3 Governing Law.
Unless a rule of law or procedure is supplied by federal law (including the Bankruptcy
Code and the Bankruptcy Rules) or the Plan, the laws of the State of New York applicable to
contracts executed in such State by residents thereof and to be performed entirely within such
State shall govern the construction and implementation of the Plan and any agreements,
documents, and instruments executed in connection with this Plan.
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10.4 Voting of Claims.
Each holder of a Claim as of the Record Date in Classes 1B, 2, 3, and 4 shall be entitled
to vote to accept or reject the Plan. The Disclosure Statement Order shall govern the manner and
procedures for casting Ballots with the Voting Agent.
10.5 Acceptance by Impaired Class.
Consistent with Bankruptcy Code section 1126(c), and except as provided for in
Bankruptcy Code section 1126(e), a Class of creditors shall have accepted the Plan if it is
accepted by at least two-thirds in dollar amount and more than one-half in number of the holders
of Allowed Claims of such Class that have timely and properly voted to accept or reject the Plan.
10.6 Presumed Acceptances of Plan.
Classes 1A is unimpaired under the Plan and, therefore, is conclusively presumed to have
accepted the Plan.
10.7 Presumed Rejections of Plan.
Class 5 is presumed to have rejected the Plan but may elect to accept the Plan
10.8 Cramdown.
The Debtors request confirmation of this Plan under Bankruptcy Code section 1129(b)
with respect to any impaired Class that does not accept this Plan pursuant to Bankruptcy Code
section 1126. The Debtors reserve the right to modify this Plan or the Plan Supplement, with the
consent of BP and the Committee, in order to satisfy the requirements of Bankruptcy Code
section 1129(b), if necessary
ARTICLE 11 - RETENTION OF JURISDICTION BY BANKRUPTCY COURT
11.1 From the Confirmation Date until entry of a final decree closing the Bankruptcy
Cases (pursuant to 11 U.S.C. § 350 and Bankruptcy Rule 3022), the Bankruptcy Court shall
retain such jurisdiction as is legally permissible over the Bankruptcy Cases for the following
purposes:
(a) to hear and determine any and all objections to the allowance of any Claim
or Administrative Expense Claim, or any controversy as to the classification of Claims or any
matters that may directly, indirectly, or contingently affect the obligations of the Debtors or
Liquidation Trustee to any Creditors, holders of Claims, or other parties in interest;
(b) to hear and determine any and all applications for compensation and
reimbursement of expenses by Professionals;
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(c) to hear and determine any and all pending motions for the assumption or
rejection of executory contracts and unexpired leases, and to fix any Claims resulting therefrom;
(d) to adjudicate through final judgment such contested matters and adversary
proceedings as may be pending or subsequently initiated in the Bankruptcy Court, including, but
not limited to, Causes of Action brought by the Liquidation Trustee;
(e) to enforce and interpret the provisions of the Plan, the Disclosure
Statement Order, the Confirmation Order, and any other order of the Bankruptcy Court in the
Bankruptcy Cases;
(f) to issue any injunction or other relief appropriate to implement the intent
of the Plan, and to enter such further orders enforcing any injunctions or other relief issued under
the Plan or pursuant to the Confirmation Order;
(g) to modify the Plan pursuant to Bankruptcy Code section 1127 and the
applicable Bankruptcy Rules;
(h) to correct any defect, cure any omission, or reconcile any inconsistency in
the Plan or in the Confirmation Order as may be necessary to carry out the purposes and the
intent of the Plan;
(i) to interpret and determine such other matters as the Confirmation Order
may provide for or as may be authorized under the Bankruptcy Code; and
(j) to enter and implement such orders as may be appropriate if the
Confirmation Order is, for any reason, stayed, reversed, revoked, modified or vacated.
ARTICLE 12 - MISCELLANEOUS PROVISIONS
12.1 Headings.
Headings are utilized in this Plan for the convenience of reference only and shall not
constitute a part of the Plan for any other purpose.
12.2 No Attorneys’ Fees.
No attorneys’ fees with respect to any Claim or Interest shall be payable under the Plan,
except as expressly specified herein or Allowed by a Final Order.
12.3 Notices.
Except as otherwise specified in the Plan, all notices in connection with the Plan shall be
in writing and shall be deemed to have been given when received or, if mailed, five (5) days after
the date of mailing. All communications shall be deemed sent if sent to the Debtors at the
following address:
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40
[LIQUIDATION TRUSTEE ADDRESS]
12.4 No Discharge.
The Debtors shall not receive a discharge under the Plan under Bankruptcy Code section
1141(d)(3).
12.5 Claims In Dollars.
Any Claims asserted in foreign currencies shall be converted to United States Dollars in
accordance with the prevailing exchange rates published by the Wall Street Journal on the
Confirmation Date.
12.6 Binding Effect.
The rights, benefits, and obligations of any Person named or referred to in the Plan, or
whose actions may be required to effectuate the terms of the Plan, shall be binding on, and shall
inure to the benefit of, any heir, executor, administrator, successor, or assign of such Person
(including, but not limited to, any trustee appointed for the Debtors under chapter 7 or 11 of the
Bankruptcy Code). The Confirmation Order shall provide that the terms and provisions of the
Plan and the Confirmation Order shall survive and remain effective after entry of any order that
may be entered converting the Bankruptcy Cases to cases under chapter 7 of the Bankruptcy
Code, and the terms and provisions of the Plan shall continue to be effective in this or any
superseding case under the Bankruptcy Code.
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41
Dated: April 1, 2020
New York, New York
By: /s/ Mark Linzenbold_____
Mark Linzenbold
Chief Financial Officer
Agera Energy LLC
By: /s/ Mark Linzenbold_____
Mark Linzenbold
Chief Financial Officer
Agera Holdings, LLC
By: /s/ Mark Linzenbold_____
Mark Linzenbold
Chief Financial Officer
energy.me midwest llc
By: /s/ Mark Linzenbold_____
Mark Linzenbold
Chief Financial Officer
Aequitas Energy, Inc.
By: /s/ Stephen Gray________
Stephen Gray
Manager
Utility Recovery LLC
By: /s/ Stephen Gray________
Stephen Gray
Manager
Agera Solutions LLC
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Exhibit B
Liquidation Analysis
(To Be Filed)
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