IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE
In re:
APP WINDDOWN, LLC, et al.,1 Debtors. : : : : : : Chapter 11 Case No. 16-12551 (BLS) (Jointly Administered)
JOINT PLAN OF LIQUIDATION OF THE DEBTORS AND DEBTORS IN POSSESSION JONES DAY
Scott J. Greenberg (admitted pro hac vice) Michael J. Cohen (admitted pro hac vice) Genna L. Ghaul (admitted pro hac vice) 250 Vesey Street
New York, New York 10281 Telephone: (212) 326-3939 Facsimile: (212) 755-7306 – and –
PACHULSKI STANG ZIEHL & JONES LLP Laura Davis Jones (DE Bar No. 2436)
James E. O’Neill (DE Bar No. 4042) 919 North Market Street, 17th Floor P.O. Box 8705
Wilmington, Delaware 19801 Telephone: (302) 652-4100 Facsimile: (302) 652-4400
ATTORNEYS FOR THE DEBTORS AND DEBTORS IN POSSESSION
Dated: June 12, 2018
1
TABLE OF CONTENTS
Page
INTRODUCTION ... 1
I.
DEFINED TERMS, RULES OF INTERPRETATION AND COMPUTATION
OF TIME ... 1
A. Defined Terms ... 1
B. Rules of Interpretation and Computation of Time ... 14
1. Rules of Interpretation ... 14
2. Computation of Time ... 14
3. Governing Law ... 14
4. Reference to Monetary Figures ... 14
II.
CLASSIFICATION AND TREATMENT OF CLAIMS AND INTERESTS ... 14
A. Unclassified Claims ... 15
1. Administrative Claims ... 15
2. Professional Compensation ... 15
3. Statutory Fees ... 16
4. Payment of Priority Tax Claims ... 16
B. Classification of Claims and Interests ... 17
1. General ... 17
2. Identification of Classes of Claims Against and Interests in the Debtors ... 17
C. Treatment of Claims ... 18
1. Other Priority Claims (Class 1) ... 18
2. Other Secured Claims (Class 2) ... 18
3. Prepetition Term Loan Secured Claims (Class 3) ... 18
4. General Unsecured Claims (Class 4) ... 19
5. Intercompany Claims (Class 5) ... 19
6. Interests (Class 6) ... 19
D. Reservation of Rights Regarding Claims ... 20
E. Insurance ... 20
III.
MEANS OF IMPLEMENTATION ... 20
A. Post-Confirmation Debtors ... 20
1. Corporate Action; Winding-Up of Affairs ... 20
2. Authority ... 21
3. Management of Post-Confirmation Debtors ... 21
B. Creditors’ Fund Trust ... 21
2. Purpose of the Creditors’ Fund Trust ... 22
3. The Creditors’ Fund Trustee and Creditors’ Fund Trust Agreement ... 22
4. Cooperation and Preservation of Privileges and Defenses ... 22
5. Compensation and Duties of Creditors’ Fund Trustee ... 23
6. Limitations of Liability ... 23
C. Distributions From Escrows Under the UCC-LT Settlement ... 23
D. Causes of Action ... 24
E. Release of Liens ... 24
F. Vesting and Sale or Other Disposition of Assets; Representative of the Estate ... 24
G. Effectuating Documents; Further Transactions ... 25
H. Substitution in Pending Legal Actions ... 25
I. Certain Workers Compensation Matters Relating to the Lender Settlement ... 25
1. Authorization of Settlements of WCCC Causes of Action ... 25
2. Release From Reserves in Connection with the Lender Settlement ... 25
J. No Substantive Consolidation ... 26
K. Records ... 26
L. Insurance Policies ... 26
M. Dissolution of Creditors’ Committee ... 27
N. Final Decree ... 27
IV.
TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES ... 27
A. Rejection of Executory Contracts and Unexpired Leases ... 27
B. Bar Date for Rejection Damages ... 27
C. Pre-Existing Obligations to the Debtors Under Executory Contracts and Unexpired Leases ... 27
V.
PROVISIONS GOVERNING DISTRIBUTIONS ... 27
A. Distributions Under the Plan ... 27
B. Disbursing Agents; No Liability ... 28
1. Powers of the Disbursing Agents ... 28
2. Expenses Incurred on or After the Effective Date ... 28
3. No Liability ... 28
C. Estimation ... 28
D. Distributions on Account of Disputed Claims ... 29
E. No Distributions Pending Allowance ... 29
F. Objection Deadline ... 29
G. Creditors’ Fund Trust Reserves and Determination of Unbudgeted, Non-Ordinary Course Administrative Claims ... 29
2. Creditors’ Fund Claims Reserve ... 29
3. Determination of Unbudgeted, Non-Ordinary Course Administrative Claims ... 30
H. Settling Disputed Claims ... 30
I. Distributions in Cash ... 30
J. Unclaimed Distributions ... 30
K. Delivery of Distributions and Undeliverable Distributions to Holders of Claims ... 31
1. Address for Delivery of Distributions ... 31
2. Undeliverable Distributions ... 31
L. Distribution Record Date ... 32
M. Defenses and Setoff ... 32
N. Compliance with Tax Requirements ... 32
O. De Minimis Distributions ... 33
P. Distributions to the Prepetition Term Loan Lenders to be Made to the Prepetition Agent ... 33
Q. Supplemental Creditors’ Fund Distribution and Distribution to Interests ... 33
VI.
SETTLEMENT, RELEASES, INJUNCTION AND RELATED PROVISIONS ... 34
A. Compromise and Settlement of Claims, Interests and Controversies ... 34
B. Releases by Debtors ... 34
C. Releases by Holders of Claims and Interests ... 34
D. Exculpation ... 35
E. Post-Effective Date Personnel ... 35
F. Injunction ... 35
G. No Consent to Change of Control Required ... 36
H. Releases Implemented by the Settlement ... 37
VII.
CONDITIONS TO THE CONFIRMATION DATE AND EFFECTIVE DATE ... 37
A. Conditions Precedent to Confirmation ... 37
B. Conditions Precedent to the Effective Date ... 37
C. Waiver of Conditions ... 37
D. Effect of Failure of Conditions ... 37
VIII.
MODIFICATION, REVOCATION OR WITHDRAWAL OF PLAN ... 38
A. Modification and Amendments ... 38
B. Effect of Confirmation on Modifications ... 38
C. Revocation or Withdrawal of the Plan ... 38
IX.
RETENTION OF JURISDICTION ... 38
X.
MISCELLANEOUS PROVISIONS ... 40
A. Immediate Binding Effect ... 40
C. U.S. Trustee Fees and Post-Confirmation Reports ... 41
D. Non-Voting Equity Securities ... 41
E. Additional Documents ... 41
F. Successors and Assigns ... 42
G. Severability of Plan Provisions ... 42
H. Exhibits ... 42
I. Votes Solicited in Good Faith ... 42
J. Conflicts ... 42
K. Service of Documents ... 43
INTRODUCTION
APP Winddown, LLC (f/k/a American Apparel, LLC), APP USA Winddown, LLC (f/k/a American Apparel (USA), LLC), APP Retail Winddown, Inc. (f/k/a American Apparel Retail, Inc.), APP D&F Winddown, Inc. (f/k/a American Apparel Dyeing & Finishing, Inc.), APP Knitting Winddown, LLC (f/k/a KCL Knitting, LLC), and APP Shipping Winddown, Inc. (f/k/a Fresh Air Freight, Inc.), as debtors and debtors in possession, propose this joint plan of liquidation for the resolution of Claims against and Interests in each of the Debtors pursuant to chapter 11 of the Bankruptcy Code. The Debtors are the proponents of the Plan within the meaning of section 1129 of the Bankruptcy Code.
As provided further herein, among other things, the Plan implements in part, or otherwise facilitates the continued implementation of, the Settlements (as defined below) by and among the Debtors and the other parties thereto, which Settlements have been separately approved by the Bankruptcy Court. Nothing in the Plan is intended, nor shall be deemed, to alter, amend, modify, or supersede the terms and conditions of the Settlements and related Orders of the Bankruptcy Court approving the Settlements.
Reference is made to the Disclosure Statement, distributed contemporaneously herewith, for a discussion of the Debtors’ assets, liabilities, history, business, results of operations, historical financial information and properties, and for a summary and analysis of the Plan.
Other agreements and documents supplementing the Plan are appended as Exhibits hereto and have been or will be Filed with the Bankruptcy Court. These supplemental agreements and documents are referenced in the Plan and the Disclosure Statement and will be available for review.
ALL CREDITORS ENTITLED TO VOTE ON THE PLAN ARE ENCOURAGED TO READ THE DISCLOSURE STATEMENT IN ITS ENTIRETY BEFORE VOTING TO ACCEPT OR REJECT THE PLAN. SUBJECT TO CERTAIN RESTRICTIONS AND REQUIREMENTS SET FORTH IN SECTION 1127 OF THE BANKRUPTCY CODE, IN BANKRUPTCY RULE 3019 AND IN THE PLAN, THE DEBTORS RESERVE THE RIGHT TO ALTER, AMEND, MODIFY, REVOKE OR WITHDRAW THE PLAN PRIOR TO ITS SUBSTANTIAL CONSUMMATION.
I. DEFINED TERMS, RULES OF INTERPRETATION AND COMPUTATION OF TIME A. Defined Terms
Capitalized terms used in the Plan and not otherwise defined shall have the meanings set forth below. Any term that is not defined in this Plan, but that is used in the Bankruptcy Code or the Bankruptcy Rules, shall have the meaning given to that term in the Bankruptcy Code or the Bankruptcy Rules, as applicable.
1. “Accrued Professional Compensation” means, at any given time, all accrued, contingent, and/or unpaid fees and expenses (including success fees) for legal, financial advisory, accounting, and other services and reimbursement of expenses that are awardable and allowable under sections 328, 330, 331, or 363 of the Bankruptcy Code or otherwise rendered allowable before the Effective Date by any Professional in the Chapter 11 Cases, (i) all to the extent that any such fees and expenses have not been previously paid (regardless of whether a fee application has been filed for any such amount) and (ii) after applying any retainer that has been provided to such Professional. To the extent that the Bankruptcy Court or any higher court of competent jurisdiction denies or reduces by a Final Order any amount of a Professional’s fees or expenses, then those reduced or denied amounts shall no longer constitute Accrued Professional Compensation. For the avoidance of doubt, Accrued Professional Compensation includes unbilled fees and expenses incurred on account of services provided by Professionals that have not yet been submitted for payment, except to the extent that such fees and expenses are either denied or reduced by a Final Order by the Bankruptcy Court or any higher court of competent jurisdiction.
Effective Date of preserving the Estates and operating the businesses of the Debtors; (ii) compensation for legal, financial advisory, accounting and other services and reimbursement of expenses awarded or allowed under sections 330(a) or 331 of the Bankruptcy Code, including Fee Claims; and (iii) all fees and charges assessed against the Estates under chapter 123 of title 28, United States Code, 28 U.S.C. §§ 1911-1930.
3. “Administrative Claims Objection Deadline” means the date that is the latest of (i) 120 days after the Effective Date, (ii) 60 days after such an Administrative Claim is Filed, (iii) such date as may be agreed between the Post-Confirmation Debtors and the Holder of an Administrative Claim, or (iv) solely with respect to Unbudgeted, Non-Ordinary Course Administrative Claims, such date as may be agreed between the Creditors’ Fund Trustee and the Holder of an Unbudgeted, Non-Ordinary Course Administrative Claim, in each case, as the same may be extended, for cause, by the Bankruptcy Court upon request of the Post-Confirmation Debtors or, with respect to Unbudgeted, Non-Ordinary Course Administrative, upon request of the Creditors’ Fund Trustee.
4. “Administrative/Priority/Tax Claims Reserve” means a reserve to be established by the Post-Confirmation Debtors on and after the Effective Date, with the consent of the Required Lenders, and maintained and controlled by the Post-Confirmation Debtors, to be used to fund (i) Distributions to be made by the Post-Confirmation Debtors pursuant to the Plan to Holders of Allowed Administrative Claims, Priority Tax Claims, Other Secured Claims, and Other Priority Claims, on account of such Allowed Claims, and (ii) all expenses of the Confirmation Debtors, including any Taxes owed by the Confirmation Debtors as part of the Post-Confirmation Debtor Functions. The amount of said reserve shall be determined by the Post-Post-Confirmation Debtors to be sufficient to cover (i) all Administrative Claims (other than Unbudgeted, Non-Ordinary Course Administrative Claims, which shall only be paid from the Creditors’ Fund Trust Assets), Priority Tax Claims, Other Priority Claims, and Other Secured Claims that have been Allowed and all such Claims that have been Disputed, and (ii) estimates of any potential Tax obligations of the Post-Confirmation Debtors and potential administrative obligations and other expenses of the Post-Confirmation Debtors, as determined by the Post-Confirmation Debtors, and may be adjusted by the Post-Confirmation Debtors from time to time, with the consent of the Required Lenders if such adjustment would likely result in a decreased distribution to Holders of Prepetition Term Loan Secured Claims, including with funds available from the monetization of the Remaining Assets.
5. “Affiliate” has the meaning set forth in section 101(2) of the Bankruptcy Code.
6. “Allowed” means, when used with respect to a Claim or Interest, (i) a Claim that has been scheduled by the Debtors in their Schedules as other than disputed, contingent or unliquidated that has not been superseded by a filed Proof of Claim and as to which the Debtors or any other party in interest has not filed an objection on or before the 270th day after the Effective Date (unless such date is extended, for cause, by the Bankruptcy Court upon request of the Post-Confirmation Debtors or the Creditors’ Fund Trustee); (ii) any Claim (or portion thereof) that is set forth in a timely filed Proof of Claim or Interest as to which no action to dispute, deny, equitably subordinate or otherwise limit recovery with respect thereto, or alter priority thereof, has been filed within the applicable period of time fixed by the Plan, the Bankruptcy Code, the Bankruptcy Rules or order of the Bankruptcy Court; or (iii) any Claim (or portion thereof) or Interest that is allowed (a) pursuant to the terms of the Plan, (b) in any contract, instrument, or other agreement entered into in connection with the Plan, (c) (1) by Final Order of the Bankruptcy Court, (2) pursuant to the authority granted to the Debtors in the Claims Procedures Order, or (3) pursuant to the authority granted to the Debtors or the Creditors’ Fund Trustee under the Plan, or (iv) with respect to an Administrative Claim only, (1) that was incurred by a Debtor in the ordinary course of business during the Chapter 11 Cases to the extent due and owing without defense, offset, recoupment or counterclaim of any kind, (2) that is not disputed by the Post-Confirmation Debtors, in whole or in part, and (3) that the Post-Confirmation Debtors have determined to pay such Claim.
7. “APP D&F Winddown” means APP D&F Winddown, Inc. (f/k/a American Apparel Dyeing & Finishing, Inc.).
9. “APP Retail Winddown” means APP Retail Winddown, Inc. (f/k/a American Apparel Retail, Inc.).
10. “APP Shipping Winddown” means APP Shipping Winddown, Inc. (f/k/a Fresh Air Freight, Inc.).
11. “APP USA Winddown” means APP USA Winddown, LLC (f/k/a American Apparel (USA), LLC).
12. “APP Winddown” means APP Winddown, LLC (f/k/a American Apparel, LLC). 13. “Avoidance Actions” means any and all avoidance, recovery, subordination or other actions or remedies that may be brought on behalf of the Debtors or the Estates under the Bankruptcy Code or applicable non-bankruptcy law, including, without limitation, actions or remedies under sections 510, 542, 543, 544, 545, 547, 548, 549, 550, 551, 553(b) and 724(a) of the Bankruptcy Code and other similar state law claims and Causes of Action other than any such claims or Causes of Action against any of the Released Parties or the Exculpated Parties.
14. “Ballot” means the applicable form or forms of ballot(s) distributed to Holders of Claims entitled to vote on the Plan and on which the acceptance or rejection of the Plan is to be indicated.
15. “Bankruptcy Code” means title 11 of the United States Code, as now in effect or hereafter amended, as applicable to these Chapter 11 Cases.
16. “Bankruptcy Court” means the United States Bankruptcy Court for the District of Delaware having jurisdiction over the Chapter 11 Cases or any other court having jurisdiction over the Chapter 11 Cases, including, to the extent of the withdrawal of any reference under 28 U.S.C. § 157, the United States District Court for the District of Delaware.
17. “Bankruptcy Rules” means, collectively, the Federal Rules of Bankruptcy Procedure and the local rules of the Bankruptcy Court, as now in effect or hereafter amended.
18. “Bar Date Order” means the Order (I) Establishing Bar Dates for Filing Claims and
(II) Approving the Form and Manner of Notice Thereof [Dkt No. 588] entered by the Bankruptcy Court on February
21, 2017.
19. “Budget” means that certain budget as defined in the Final Cash Collateral Order. 20. “Business Day” means any day, other than a Saturday, Sunday or “legal holiday” (as defined in Bankruptcy Rule 9006(a)).
21. “Cash” means the lawful currency of the United States of America and equivalents thereof.
23. “Chapter 11 Case” or “Chapter 11 Cases” means (i) when used with reference to a particular Debtor, the chapter 11 case pending for that Debtor under chapter 11 of the Bankruptcy Code in the Bankruptcy Court, and (ii) when used with reference to all Debtors, the procedurally consolidated chapter 11 cases pending for the Debtors in the Bankruptcy Court under Case No. 16-12551 (BLS).
24. “Claim” means a claim, as such term is defined in section 101(5) of the Bankruptcy Code, against a Debtor.
25. “Claims Bar Date” means, as applicable, the (i) First Administrative Expense Bar Date, (ii) the General Bar Date, (iii) the Governmental Bar Date, (iv) the Rejection Bar Date, (v) the Amended Schedules Bar Date (parts (i) through (v) as defined in the Bar Date Order), (vi) the Second Administrative Expense Bar Date, and (vii) any other date or dates established or to be established by an order of the Bankruptcy Court by which Proofs of Claim must be filed.
26. “Claims Objection Deadline” means, for all Claims, the latest of: (i) 270 days after the Effective Date, (ii) 90 days after the Filing of any Proof of Claim, and (iii) such other period of limitation for objecting to Claims as may be specifically fixed by the Plan, the Confirmation Order, the Bankruptcy Rules or a Final Order, in each case, as the same may be extended, for cause, by the Bankruptcy Court upon request of the Post-Confirmation Debtors or, with respect to General Unsecured Claims, upon request of the Creditors’ Fund Trustee.
27. “Claims Procedures Order” means the Order Pursuant to 11 U.S.C. § 105(a) and Fed.
R. Bankr. P. 9019(b) Establishing Procedures for Settling Certain Claims [Dkt. No. 989] entered by the Bankruptcy
Court on July 25, 2017.
28. “Class” means a class of Claims or Interests, as described in Article II.
29. “Class 6 Distribution” means Cash remaining, if any, after (a) satisfaction of all Allowed Claims, Prepetition Term Loan Interest Claims, General Unsecured Interest Claims, and (b) reserves for (i) any Disputed Claims (and any General Unsecured Interest Claims with respect to any Disputed General Unsecured Claims) and (ii) amounts necessary to fund the Post-Confirmation Debtors,
30. “Committee of Lead Lenders” means, collectively, the Lender Committee Parties, as holders and/or investment advisors to holders of loans under the Prepetition Credit Agreement and limited liability company interests in APP Winddown.
31. “Confirmation” means the entry of the Confirmation Order on the docket of the Bankruptcy Court.
32. “Confirmation Date” means the date on which the Bankruptcy Court enters the Confirmation Order on its docket, within the meaning of Bankruptcy Rules 5003 and 9021.
33. “Confirmation Hearing” means the hearing held by the Bankruptcy Court to consider Confirmation of the Plan, as such hearing may be continued from time to time.
34. “Confirmation Order” means the order of the Bankruptcy Court confirming the Plan pursuant to section 1129 of the Bankruptcy Code.
35. “Creditor” means any creditor, as defined in section 101(10) of the Bankruptcy Code. 36. “Creditors’ Committee” shall mean the official committee of unsecured creditors appointed in the Chapter 11 Cases pursuant to section 1102 of the Bankruptcy Code.
38. “Creditors’ Fund Trust Agreement” means the Creditors’ Fund Trust Agreement substantially in the form to be filed as a Plan Supplement.
39. “Creditors’ Fund Trust Assets” means the Creditors’ Fund Trust Initial Assets plus the Supplemental Creditors’ Fund Trust Distribution.
40. “Creditors’ Fund Trust Expenses” means all reasonable and documented fees, expenses, and costs incurred by the Creditors’ Fund Trustee in connection with carrying out the obligations of the Creditors’ Fund Trust, including the maintenance or disposition of the Creditors’ Fund Trust Assets (including, but not limited to, Creditors’ Fund Trustee fees, indemnity reserves, attorneys’ fees, the fees of professionals, and other Persons retained by the Creditors’ Fund Trustee, personnel-related expenses, and any Taxes imposed on the Creditors’ Fund Trust or in respect of the Creditors’ Fund Trust Assets), and any other expenses incurred in accordance with the Creditors’ Fund Trust Agreement.
41. “Creditors’ Fund Trust Functions” means the following functions and duties to be carried out by the Creditors’ Fund Trustee on and after the Effective Date pursuant to the Plan and the Creditors’ Fund Trust Agreement: (i) the payment of the Creditors’ Fund Trust Expenses, without need of further Bankruptcy Court approval or notice, (ii) the filing, prosecution, settlement and/or other disposition of any and all objections to Class 4 Claims and Unbudgeted, Non-Ordinary Course Administrative Claims; (iii) the distribution of the proceeds of the Creditors’ Fund Trust Assets (after payment of or reserve for all Creditors’ Fund Trust Expenses) to the Creditors’ Fund Trust beneficiaries pursuant to the Creditors’ Fund Trust Agreement; (iv) certain operating or other reports required by the Bankruptcy Code and the Bankruptcy Rules in these Chapter 11 Cases; and (v) the preparation and filing of tax returns of the Creditors’ Fund Trust to the extent required by law, the payment of any Taxes owed by the Creditors’ Fund Trust, and complying with any withholding and reporting obligations required by law.
42. “Creditors’ Fund Trust Initial Assets” means Cash in the amount of $2.25 million. 43. “Creditors’ Fund Claims Reserve” means that certain reserve established pursuant to Section V.G.2.
44. “Creditors’ Fund Trust Expense Reserve” means that certain reserve established pursuant to Section V.G.1.
45. “Creditors’ Fund Trustee” means the trustee for the Creditors’ Fund Trust pursuant and subject to the terms of the Creditors’ Fund Trust Agreement. The Creditors’ Fund Trustee shall be selected as set forth in the Creditors’ Fund Trust Agreement, and his or her identity, proposed compensation and other pertinent information will be provided in a Plan Supplement.
46. “Debtors” means, collectively, APP Winddown, APP USA Winddown, APP Retail Winddown, APP D&F Winddown, APP Knitting Winddown, and APP Shipping Winddown.
47. “Disallowed” means any Claim, or any portion thereof, that (i) has been disallowed by a Final Order or a settlement, (ii) is listed in the Schedules at zero dollars or as contingent, disputed, or unliquidated and as to which a Claims Bar Date has been established but no Proof of Claim has been timely filed or deemed timely filed with the Bankruptcy Court pursuant to either the Bankruptcy Code or any Final Order of the Bankruptcy Court, including the Bar Date Order, or otherwise deemed timely filed under applicable law, or (iii) is not listed in the Schedules and as to which a Claims Bar Date has been established but no Proof of Claim has been timely filed or deemed timely filed with the Bankruptcy Court pursuant to either the Bankruptcy Code or any Final Order of the Bankruptcy Court or otherwise deemed timely filed under applicable law.
Fund Trustee to make or facilitate Distributions to Holders of Allowed Claims (solely to the extent that authority to make or facilitate such Distributions is vested in the Creditors’ Fund Trustee pursuant to Section III.B.3 or the Creditors’ Fund Trust Agreement).
49. “Disclosure Statement” means the disclosure statement that relates to the Plan, as such disclosure statement may be amended, modified or supplemented (including all exhibits and schedules annexed thereto or referred to therein).
50. “Disclosure Statement Order” means an order entered by the Bankruptcy Court, approving, among other things, the Disclosure Statement as containing adequate information pursuant to section 1125 of the Bankruptcy Code, authorizing solicitation of the Disclosure Statement and the Plan and approving related solicitation materials.
51. “Disputed Claim” means any portion of a Claim (i) that is neither an Allowed Claim nor a Disallowed Claim, (ii) that is listed as disputed, contingent or unliquidated on the Schedules and for which a Proof of Claim has been timely filed or that is otherwise subject to an objection or (iii) for which a Proof of Claim or request for payment of an administrative expense has been filed with the Bankruptcy Court or a written request for payment has been made, to the extent the Debtors have, or any party in interest entitled to do so has, interposed a timely objection or request for estimation, which objection or request for estimation has not been withdrawn or determined by a Final Order.
52. “Dissolution Transactions” means the transactions that the Debtors, or the Post-Confirmation Debtors, determine to be necessary or appropriate to implement the terms of the Plan, and that ultimately result in the dissolution or other termination of the corporate entities that comprise the Debtors and the Foreign Subsidiaries.
53. “Distribution” means the distributions to be made pursuant to the Plan.
54. “Distribution Record Date” means the date that the Confirmation Order is entered by the Bankruptcy Court.
55. “Document Website” means the internet site at
https://cases.primeclerk.com/AmericanApparel at which all of the exhibits and schedules to the Plan and the Disclosure Statement will be available to any party in interest and the public, free of charge.
56. “Effective Date” means the first Business Day on or after all of the conditions to the Effective Date in Section VII.B have been met or waived.
57. “Entity” has the meaning set forth in section 101(15) of the Bankruptcy Code.
58. “Estate” means, as to each Debtor, the estate created for such Debtor in its Chapter 11 Case pursuant to section 541 of the Bankruptcy Code.
59. “Excluded Parties” means any Entity or Entities (a) identified on Schedule 1.59 to the Plan and any immediate family member of such individual(s) and (b) identified on Exhibit I to the chapter 11 plan in the Prior Cases any immediate family member of such individuals.
61. “Executory Contract” or “Unexpired Lease” means a contract or lease to which a Debtor is a party that is subject to assumption, assumption and assignment or rejection under section 365 of the Bankruptcy Code, including any modifications, amendments, addenda or supplements thereto or restatements thereof.
62. “Exhibit” means an exhibit attached to this Plan or included in the Plan Supplement. 63. “Federal Judgment Rate” means the interest rate on federal judgments, in effect for the calendar week of the Petition Date, and is based on the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System.
64. “Fee Claim” means a Claim under sections 328, 330(a), 331, 503 or 1103 of the Bankruptcy Code for compensation of a Professional or other Entity for services rendered or expenses incurred in the Chapter 11 Cases.
65. “Fee Order” means the Order Authorizing Procedures for Interim Compensation and
Reimbursement of Expenses of Professionals [Dkt. No. 263] entered by the Bankruptcy Court on December 8, 2016.
66. “File,” “Filed” or “Filing” means to file, to have filed or a filing with the Bankruptcy Court or its authorized designee in connection with the Chapter 11 Cases.
67. “Final Cash Collateral Order” means the Final Order (I) Authorizing the Debtors to
Utilize Cash Collateral, (II) Granting Adequate Protection to Prepetition Secured Parties and (III) Granting Related Relief [Dkt. No. 492] entered by the Bankruptcy Court on January 12, 2017.
68. “Final DIP Order” means the Final Order (I) Authorizing the Debtors to (A) Obtain
Post-Petition Senior Secured Superpriority Financing Pursuant to 11 U.S.C. §§ 105, 361, 362, 363(c), 364(c), 364(d)(1), 364€ and 507 and (B) Utilize Cash Collateral, (II) Granting Priming Liens, Priority Liens and Superpriority Claims to the DIP Secured Parties, (III) Granting Adequate Protection to Prepetition Secured Parties and (IV) Granting Related Relief [Dkt. No. 299] entered by the Bankruptcy Court on December 12, 2016.
69. “Final Order” means an order or judgment of the Bankruptcy Court, or other court of competent jurisdiction, as entered on the docket in the Chapter 11 Cases or the docket of any other court of competent jurisdiction, that has not been reversed, stayed, modified or amended, and as to which the time to appeal or seek certiorari or move for a new trial, reargument or rehearing has expired, and no appeal or petition for certiorari or other proceedings for a new trial, reargument or rehearing has been timely taken, or as to which any appeal that has been taken or any petition for certiorari that has been timely filed has been withdrawn or resolved by the highest court to which the order or judgment was appealed or from which certiorari was sought or the new trial, reargument or rehearing shall have been denied or resulted in no modification of such order; provided that the possibility that a motion under rule 60 of the Federal Rules of Civil Procedure, or any analogous rule under the Bankruptcy Rules, may be filed relating to such order, shall not cause an order not to be a Final Order.
70. “Foreign Subsidiaries” means, collectively, American Apparel Asia Limited, American Apparel (Beijing) Trading Company, Ltd., American Apparel Australia Pty Limited, American Apparel Canada Retail Inc., American Apparel Canada Wholesale Inc., American Apparel Japan Yugen Kaisha, American Apparel (Carnaby) Limited, American Apparel (UK) Limited, American Apparel Deutschland GmbH, American Apparel do Brasil Participacoes Ltda., American Apparel Mexico, S. de. R.L. de C.V., American Apparel Mexico Labor, S. de R.L. de C.V., American Apparel Ireland Limited, American Apparel Retail (Israel) Ltd., and American Apparel Korea Co., Ltd., in each case, to the extent the Debtors’ interests in such entities have not be sold, cancelled, or otherwise disposed of prior to the Effective Date.
72. “General Unsecured Interest Claims” means, with respect to any Allowed General Unsecured Claim, a claim for interest accruing from and after the Petition Date at the Federal Judgment Rate.
73. “Holder” means an Entity holding a Claim or Interest, as the context requires.
74. “Impaired” means, when used in reference to a Claim or an Interest, a Claim or an Interest that is impaired within the meaning of section 1124 of the Bankruptcy Code.
75. “Intercompany Claim” means any Claim held by a Debtor against a Debtor.
76. “Interest” means the rights of the Holders of the common stock, membership interests, partnership interests or other equity interests issued by a Debtor and outstanding immediately prior to the Petition Date, and any options, warrants or other rights with respect thereto, or any other instruments evidencing an ownership interest in a Debtor and the rights of any Entity to purchase or demand the issuance of any of the foregoing, including: (i) redemption, conversion, exchange, voting, participation and dividend rights (including any rights in respect of accrued and unpaid dividends); (ii) liquidation preferences; and (iii) stock options and warrants.
77. “Lender Committee Parties” means Blackwell Partners, LLC, Series A; Coliseum Capital Partners, L.P.; Coliseum Capital Partners II, L.P.; Global Opportunities, LLC; Global Opportunities Offshore, Ltd.; Goldman Sachs Lux Investment Funds for the benefit of Goldman Sachs High Yield Floating Rate Portfolio (LUX); Goldman Sachs Lux Investment Funds for the benefit of Goldman Sachs Global Multi-Sector Credit Portfolio (LUX); Goldman Sachs Trust, on behalf of the Goldman Sachs High Yield Floating Rate Fund; Monarch Master Funding Ltd.; Oceana Master Fund Ltd.; AAI Pentwater Fund Public Limited Company; Pentwater Event Driven Cayman Fund Ltd.; PWCM Master Fund Ltd.; and LMA SPC for and on behalf of Map 98 Segregated Portfolio.
78. “Lender Settlement” means the settlement by and among the Debtors, the Standard General Parties, the Lender Committee Parties, and the Prepetition Agent, which settlement was approved by Lender Settlement Order.
79. “Lender Settlement Order” means the Order Authorizing and Approving Settlement
Agreement with the Prepetition Lenders and Prepetition Agent entered by the Bankruptcy Court on December 12,
2017 [Dkt. No. 1415].
80. “Lien” has the meaning set forth in section 101(37) of the Bankruptcy Code.
81. “Litigation Trust” means the trust established in the Prior Cases to administer the assets thereof under the Litigation Trust Agreement.
82. “Litigation Trust Agreement” means the litigation trust agreement, dated February 5, 2016, between the Debtors and the Litigation Trustee, governing the Litigation Trust.
83. “Litigation Trust Payment” means that certain payment in the amount of $250,000 to be made by the Post-Confirmation Debtors to the Litigation Trustee out of the Settlement Escrow on the Effective Date or as soon thereafter as is practicable, as agreed between the Litigation Trustee and the Creditors’ Committee in connection with the UCC-LT Settlement .
84. “Litigation Trustee” means the litigation trustee appointed in the Prior Cases.
85. “LTCA” means the causes of action set forth on Schedule 1.85, which are the “Specified Causes of Action” as defined in the chapter 11 plan in the Prior Cases transferred to the Litigation Trust in the Prior Cases.
Non-Ordinary Course Administrative Claims, plus (iii) any other expenses, costs, charges and claims to be paid prior to distributions to Allowed Holders of General Unsecured Claims under the Creditors’ Fund Trust Agreement.
87. “Notice and Claims Agent” means Prime Clerk LLC, in its capacity as noticing, claims and solicitation agent for the Debtors.
88. “Ordinary Course Professionals Order” means the Order (I) Authorizing the Retention
and Payment, Nunc Pro Tunc as of the Petition Date, of Professionals Utilized bv the Debtors in the Ordinary Course of Business and (II) Granting Related Relief entered by the Bankruptcy Court on December 8, 2016 [Dkt.
No. 260].
89. “Other Priority Claim” means a Claim that is entitled to priority in payment pursuant to section 507(a) of the Bankruptcy Code that is not an Administrative Claim or a Priority Tax Claim.
90. “Other Secured Claim” means a Secured Claim, including a Secured Tax Claim but excluding a Prepetition Term Loan Secured Claim.
91. “Person” means a person, as defined in section 101(41) of the Bankruptcy Code. 92. “Petition Date” means November 14, 2016.
93. “Plan” means this joint plan of liquidation for the Debtors, and all Exhibits attached hereto or referenced herein, supplements, appendices, schedules, and the Plan Supplement, as the same may be amended, modified or supplemented in accordance with the Bankruptcy Code and Bankruptcy Rules.
94. “Plan Supplement” means Plan related documents, schedules and exhibits to be Filed with the Bankruptcy Court by the Plan Supplement Filing Date, which may consist of one or multiple filings, including the Creditors’ Fund Trust Agreement and identification of the Creditors’ Fund Trustee, the operating agreements governing the Post-Confirmation Debtors and disclosure of related pertinent information, which shall be acceptable in form and substance to the Standard General Parties, Lender Committee Parties, and Prepetition Agent.
95. “Plan Supplement Filing Date” means the date on which the Plan Supplement shall be filed with the Bankruptcy Court, which date shall be at least ten (10) days prior to the Voting Deadline or such later date as may be approved by the Bankruptcy Court.
97. “Post-Confirmation Debtor Functions Completion Notice” means a notice that the Post-Confirmation Debtor Functions have been completed or otherwise satisfied, which notice is filed with the Bankruptcy Court.
98. “Post-Confirmation Debtors” means APP Winddown and APP Shipping Winddown on and after the Effective Date, which entities shall continue and remain in existence on and after the Effective Date solely to carry out the Post-Confirmation Debtor Functions.
99. “Prepetition Agent” means Wilmington Trust, National Association, in its capacity as administrative agent under the Prepetition Credit Agreement.
100. “Prepetition Credit Agreement” means that certain Credit Agreement dated as of February 5, 2016 (as amended, amended and restated, supplemented or otherwise modified from time to time) among American Apparel (USA), LLC, as borrower and borrower representative; American Apparel Retail, Inc., American Apparel Dyeing & Finishing, Inc., and KCL Knitting, LLC, as other borrowers, American Apparel, LLC and Fresh Air Freight, Inc., as guarantors, the Prepetition Agent, and the Prepetition Term Loan Lenders.
101. “Prepetition Collateral” means all collateral granted or pledged by the Debtors pursuant to the Prepetition Collateral Documents and all property deemed to be, and treated as, the collateral of the Prepetition Term Loan Lenders pursuant to the Settlements, including the Remaining Assets.
102. “Prepetition Collateral Documents” means (i) that certain Security Agreement, dated as of February 5, 2016 (as amended, amended and restated, supplemented or otherwise modified from time to time), and entered into by and among the Prepetition Agent, for the benefit of itself and the Prepetition Term Loan Lenders, the borrowers under the Prepetition Credit Agreement and each other party signatory thereto; (ii) that certain Intellectual Property Agreement, dated as of February 5, 2016 (as amended, amended and restated, supplemented or otherwise modified from time to time), and entered into by and among the Prepetition Agent, for the benefit of itself and the Prepetition Term Loan Lenders, APP USA Winddown, APP Winddown and each other party signatory thereto; and (iii) any other collateral documents executed in connection with or related to the Prepetition Credit Agreement.
103. “Prepetition Loan Documents” means the Prepetition Credit Agreement together with all amendments and other agreements, documents and instruments executed and/or delivered in connection therewith or related thereto, including the Prepetition Collateral Documents.
104. “Prepetition Term Loan Adversary Proceeding” means the adversary proceeding brought before the Bankruptcy Court on January 23, 2017 under Adversary Proceeding No. 17-50014 by Standard General L.P., Standard General Master Fund, L.P., and P Standard General Ltd. against the Lender Committee Parties and the Prepetition Agent.
105. “Prepetition Term Loan Claim” means any and all Claims against any of the Debtors arising under, related to or evidenced by the Prepetition Loan Documents, including, without limitation, any guaranty obligations with respect to any of the foregoing.
106. “Prepetition Term Loan Deficiency Claim” means the unsecured portion of any Prepetition Term Loan Claim.
108. “Prepetition Term Loan Interest Claim” means Claims for interest on the Prepetition Term Loan Claims from and after the Petition Date accruing at the rate set forth in the Prepetition Term Loan Documents.
109. “Prepetition Term Loan Lenders” means the lenders under the Prepetition Credit Agreement.
110. “Prepetition Term Loan Secured Claim” means the secured portion of any Prepetition Term Loan Claim.
111. “Prior Cases” means the jointly administered chapter 11 cases of the Debtors’ predecessors-in-interest currently pending before the Bankruptcy Court under Case No. 15-12055 (BLS).
112. “Priority Tax Claim” means a Claim that is entitled to priority in payment pursuant to section 507(a)(8) of the Bankruptcy Code.
113. “Pro Rata Share” means, with respect to (a) an Allowed Claim, the proportion that an Allowed Claim bears to the aggregate amount of Allowed Claims and Disputed Claims within the same Class, as of such time of calculation, and (b) an Allowed Interest, the proportion than an Allowed Interest bears to the Aggregate amount of Allowed Interests within the same Class, as of such time of calculation.
114. “Professional” means any professional employed in the Chapter 11 Cases pursuant to sections 327, 328, 363 or 1103 of the Bankruptcy Code or any professional or other Entity seeking compensation or reimbursement of expenses in connection with the Chapter 11 Cases pursuant to section 503(b)(4) of the Bankruptcy Code, including without limitation any professionals employed by the Debtors pursuant to the Ordinary Course Professionals Order.
115. “Proof of Claim” means a proof of claim filed with the Bankruptcy Court or the Notice and Claims Agent in connection with the Chapter 11 Cases.
116. “Recovered Cash Collateral” means all cash or cash equivalents that, as of the Petition Date, are held by Arch Insurance Company and American International Group, Inc., or any of their respective affiliates, to secure workers’ compensation deductible obligations related to the operations of either the Debtors or their predecessors recovered by the Debtors or Post-Confirmation Debtors, net after the payment of any contingency fees incurred by the Debtors or Post-Confirmation Debtors in recovering such cash or cash equivalents.
117. “Reinstated” means, with respect to Claims and Interests, the treatment provided for in section 1124 of the Bankruptcy Code.
118. “Released Parties” means, collectively and individually, (i) the Debtors, (ii) the Creditors’ Committee, (iii) the Prepetition Agent, (iv) the Committee of Lead Lenders, (v) the Lender Committee Parties, (vi) Standard General Parties, and (vii) the Representatives of each of the parties enumerated in the preceding clauses (i)–(vi) solely in their capacities as Representatives of such parties; provided that any Entity that objects to Confirmation of, or votes to reject, the Plan (except the Creditors’ Committee, solely in its capacity of such), and any of their respective Representatives, in each case, shall not be a Released Party; provided, further, that none of the Excluded Parties shall be a Released Party.
120. “Remaining Assets” means all claims and Causes of Action of the Debtors, Avoidance Actions, uncollected accounts receivable, interests in Foreign Subsidiaries, any cash proceeds resulting from the release of any collateral or property securing any workers’ compensation program of the Debtors, and all other remaining assets of the Debtors upon the Effective Date, other than the Creditors’ Fund Trust Initial Assets and the Litigation Trust Payment to be made pursuant to Section III.C.
121. “Representatives” means, with respect to any Entity, any successor, predecessor, officer, director, partner, limited partner, general partner, shareholder, member, manager, management company, investment manager or advisor, affiliate, employee, agent, attorney, advisor, investment banker, financial advisor, accountant or other Professional of such Entity, in each case, solely in such capacity, serving on or after the Petition Date, or any of the foregoing and any committee of which such Entity is a member, in each case, solely in such capacity, serving on or after the Petition Date; and, solely with respect to the Prepetition Agent, the Lender Committee Parties, and the Standard General Parties, such Entities’ current or former advisory clients, managed accounts, investment managers, owners, and related organizations and parties, and each officer, director, partner, employee, agent, attorney or advisor of each of the foregoing, in each case, solely in their capacity as such and not in their individual capacities.
122. “Required Lenders” means those Entities holding a majority (by amount) of the Allowed Prepetition Term Loan Claims.
123. “Schedules” means, collectively, the (i) schedules of assets, liabilities and Executory Contracts and Unexpired Leases and (ii) statements of financial affairs, as each may be amended and supplemented from time to time, Filed by the Debtors pursuant to section 521 of the Bankruptcy Code.
124. “Second Administrative Expense Bar Date” means the date that is 30 days after the Effective Date. Fee Claims shall not be subject to the Second Administrative Expense Bar Date but rather are governed by the provisions related to final fee applications set forth in Section II.A.2.a of the Plan.
125. “Secured Claim” means a Claim that is secured by a Lien on property in which an Estate has an interest or that is subject to a valid right of setoff under section 553 of the Bankruptcy Code, to the extent of the value of the Claim Holder’s interest in such Estate’s interest in such property or to the extent of the amount subject to such valid right of setoff, as applicable, as determined pursuant to section 506 of the Bankruptcy Code.
126. “Secured Tax Claim” means any Secured Claim against any Debtor that, absent its secured status, would be entitled to priority in right of payment under section 507(a)(8) of the Bankruptcy Code (determined irrespective of time limitations), including any related Secured Claim for penalties.
127. “Settlements” means, collectively, the UCC-LT Settlement and the Lender Settlement. 128. “Settlement Escrow” means that certain $2.5 million escrow established by the Debtors for the benefit of the Debtors’ unsecured creditors and the beneficiaries of the Litigation Trust pursuant to the UCC-LT Settlement Order.
129. “Settlement Orders” means, collectively, the UCC-LT Settlement Order and the Lender Settlement Order.
130. “Standard General Parties” means P Standard General Ltd., Standard General L.P., Standard General Master Fund, L.P., Standard General Fund L.P., SG Gaming LLC, and P Standard General Onshore LLC.
132. “Supplemental Creditors’ Fund Trust Distribution” means any Cash remaining, if any, following payment in full of all Prepetition Term Loan Claims and Prepetition Term Loan Interests Claims and, plus the amount of Cash, if any net of (i) amounts necessary to satisfy Allowed Administrative Claims (other than Unbudgeted, Non-Ordinary Course Administrative Claims), Priority Tax Claims, Other Priority Claims and Other Secured Claims, (ii) reserves sufficient to pay Disputed Claims of the type set forth in clause (i) to the extent such claims may become Allowed, and (iii) amounts necessary to fund the Post-Confirmation Debtors; provided, however, that the Supplemental Creditors’ Fund Trust Distribution shall not exceed the aggregate amount of Allowed General Unsecured Claims and the General Unsecured Interest Claims.
133. “Tax” means: (i) any net income, alternative or add-on minimum, gross income, gross receipts, sales, use, ad valorem, value added, transfer, franchise, profits, license, property, employment, environmental or other tax, assessment or charge of any kind whatsoever (together in each instance with any interest, penalty, addition to tax or additional amount) imposed by any federal, state, local or foreign taxing authority; or (ii) any liability for payment of any amounts of the foregoing types as a result of being a member of an affiliated, consolidated, combined or unitary group, or being a party to any agreement or arrangement whereby liability for payment of any such amounts is determined by reference to the liability of any other Entity.
134. “Third Party Release” means the release provision set forth in Section VI.C of the Plan. 135. “UCC-LT Settlement” means the settlement by and among the Debtors, the Creditors’ Committee, the Committee of Lead Lenders, and the Litigation Trustee, which settlement was approved by the UCC-LT Settlement Order.
136. “UCC-LT Settlement Order” means the Order Approving Settlement [Dkt. No. 493] entered by the Bankruptcy Court on January 12, 2017.
137. “Unbudgeted, Non-Ordinary Course Administrative Claims” means Allowed Administrative Claims incurred by the Debtors outside of the ordinary course of business which are not budgeted for payment from the cash collateral of the Prepetition Term Loan Lenders under the Budget. Any professional fees and expenses of the Creditors’ Committee allowed pursuant to a Court order that remain unpaid on the Effective Date shall constitute an Allowed Unbudgeted, Non-Ordinary Course Administrative Claim. A non-exclusive list of Unbudgeted, Non-Ordinary Course Administrative Claims, based on Administrative Claims asserted through May 15, 2018, is attached hereto as Schedule 1.137. For the avoidance of doubt, professional fees and expenses of the Creditors’ Committee are subject to the UCC-LT Settlement Order.
138. “Unimpaired” means, when used in reference to a Claim or an Interest, a Claim or an Interest that is not Impaired within the meaning of section 1124 of the Bankruptcy Code.
139. “U.S. Trustee” means the United States Trustee appointed under 28 U.S.C. § 581 to serve in the District of Delaware.
140. “Voting Deadline” means 5:00 p.m. (prevailing Eastern time) on [August __], 2018, which is the deadline for submitting Ballots to accept or reject the Plan in accordance with section 1126 of the Bankruptcy Code.
B. Rules of Interpretation and Computation of Time 1. Rules of Interpretation
For purposes of the Plan, unless otherwise provided herein: (a) whenever it is appropriate from the context, each term, whether stated in the singular or the plural, includes both the singular and the plural; (b) unless otherwise provided in the Plan, any reference in the Plan to a contract, instrument, release or other agreement or document being in a particular form or on particular terms and conditions means that such document shall be substantially in such form or substantially on such terms and conditions; (c) any reference in the Plan to an existing document or Exhibit Filed or to be Filed means such document or Exhibit, as it may have been or may be amended, modified or supplemented pursuant to the Plan, Confirmation Order or otherwise; (d) any reference to an Entity as a Holder of a Claim or Interest includes that Entity’s successors, assigns and affiliates; (e) all references in the Plan to Sections, Articles and Exhibits are references to Sections, Articles and Exhibits of or to the Plan; (f) the words “herein,” “hereunder” and “hereto” refer to the Plan in its entirety rather than to a particular portion of the Plan; (g) captions and headings to Articles and Sections are inserted for convenience of reference only and are not intended to be a part of or to affect the interpretation of the Plan; (h) subject to the provisions of any contract, articles or certificates of incorporation, bylaws, codes of regulation, similar constituent documents, instrument, release or other agreement or document entered into or delivered in connection with the Plan, the rights and obligations arising under the Plan shall be governed by, and construed and enforced in accordance with, federal law, including the Bankruptcy Code and the Bankruptcy Rules; and (i) the rules of construction set forth in section 102 of the Bankruptcy Code shall apply to the extent not inconsistent with any other provision of this Section I.B.1.
2. Computation of Time
In computing any period of time prescribed or allowed by the Plan, the provisions of Bankruptcy Rule 9006(a) shall apply.
3. Governing Law
Unless a rule of law or procedure is supplied by federal law (including the Bankruptcy Code and Bankruptcy Rules) or unless otherwise specifically stated, the laws of the State of Delaware, without giving effect to the principles of conflict of laws, shall govern the rights, obligations, construction and implementation of the Plan, any agreements, documents, instruments or contracts executed or entered into in connection with the Plan (except as otherwise set forth in those agreements, in which case the governing law of such agreement shall control); provided,
however, that governance matters relating to the Debtors or the Post-Confirmation Debtors, as applicable, not
incorporated or organized in Delaware shall be governed by the laws of the jurisdiction of incorporation or organization of the applicable Debtor or Post-Confirmation Debtor.
4. Reference to Monetary Figures
All references in the Plan to monetary figures refer to the lawful currency of the United States of America, unless otherwise expressly provided.
II. CLASSIFICATION AND TREATMENT OF CLAIMS AND INTERESTS
A. Unclassified Claims
1. Administrative Claims
a. Administrative Claims in General
Except as specified in this Section II.A.1, and subject to the bar date provisions herein and set forth in the Bar Date Order, unless otherwise agreed by (i) the Holder of an Administrative Claim, (ii)(a) the Debtors (prior to the Effective Date) or (b) the Post-Confirmation Debtors (on or after the Effective Date), (iii) the Required Lenders, and (iv) solely with respect to Unbudgeted, Non-Ordinary Course Administrative Claims, the Post-Confirmation Debtors and the Creditors’ Fund Trustee (unless an order of the Bankruptcy Court or agreement of the Post-Confirmation Debtors and Creditors’ Fund Trustee provides otherwise), each Holder of an Allowed Administrative Claim shall receive, in full satisfaction of its Administrative Claim, Cash equal to the Allowed amount of such Administrative Claim on either (1) if the Administrative Claim is Allowed on the Effective Date, the Effective Date (or as soon thereafter as practicable) or (2) if the Administrative Claim is not Allowed on the Effective Date, within 60 days after the date on which such Administrative Claim becomes an Allowed Administrative Claim. Payment of Allowed Administrative Claims that are not Allowed Unbudgeted, Non-Ordinary Course Administrative Claims shall be made by the Post-Confirmation Debtors only from the Administrative/Priority/Tax Claims Reserve and the proceeds of the Remaining Assets. Payment of Allowed Unbudgeted, Non-Ordinary Course Administrative Claims shall be made by the Creditors’ Fund Trustee from the Creditors’ Fund Trust Assets. For the avoidance of doubt, the Post-Confirmation Debtors shall have no liability or responsibility to pay any Allowed Unbudgeted, Non-Ordinary Course Administrative Claims.
b. Bar Date for Administrative Claims
Unless previously Filed or except as required to have been filed by the First Administrative Expense Bar Date pursuant to the Bar Date Order or as governed in another order of the Bankruptcy Court, requests for payment of Administrative Claims must be Filed and served on the parties identified in Section X.K (other than the Creditors’ Committee) and the Creditors’ Fund Trustee pursuant to the procedures specified in the Confirmation Order and the notice of entry of the Confirmation Order no later than the Second Administrative Expense Bar Date. Any Holder of an Administrative Claim who was not required to File proof of such Administrative Claim or a request for payment thereof pursuant to the Bar Date Order shall be required to file a request for payment of such Administrative Claim by the Second Administrative Expense Bar Date. Any Holders of Administrative Claims that were or are required to File and serve a request for payment of Administrative Claims and that did not or do not File and serve such a request by the applicable bar date will be forever barred from asserting such Administrative Claims against the Debtors, or their respective property, and such Administrative Claims will be deemed Disallowed as of the Effective Date and not entitled to payment under the Plan. Objections to the requests for payment of Administrative Claims must be Filed and served on the parties identified in Section X.K (other than the Creditors’ Committee), the Creditors’ Fund Trustee and the requesting party no later than the latest of (i) 120 days after the Effective Date, (ii) 60 days after such request is Filed, and (iii) such date as may be agreed between the Post-Confirmation Debtors and the Holder of an Administrative Claim, in each case, as the same may be extended, for cause, by the Bankruptcy Court upon request of the Post-Confirmation Debtor. Nothing in this Section II.A.1.b shall waive, extend or lengthen the applicable Claims Bar Date for the Holder of any prepetition Claim or Administrative Claim subject to a Claims Bar Date established by any Bankruptcy Court order.
2. Professional Compensation a. Final Fee Applications
approval (except as provided in the Ordinary Course Professionals Order). Except as otherwise agreed to by the Holder of a Fee Claim, objections to any Fee Claim must be Filed and served on the parties identified in Section X.K and the requesting party by 75 days after the Effective Date or such other period of limitation as may be specifically fixed by a Final Order for objecting to such Fee Claims. To the extent necessary, the Confirmation Order will supersede any previously entered order of the Bankruptcy Court regarding the payment of Fee Claims.
b. Post-Effective Date Professionals’ Fees and Expenses
Except as otherwise specifically provided in this Plan, from and after the Effective Date, any requirement that Professionals comply with sections 327 through 331 and 1103 of the Bankruptcy Code in seeking retention or compensation for services rendered after such date shall terminate, and (i) the Post-Confirmation Debtors may employ and pay the actual, reasonable, and necessary fees and expenses of any Professional from the funds in the Administrative/Priority/Tax Claims Reserve and the Remaining Assets (and, with respect to Professionals retained on a contingency basis, from the proceeds of the Causes of Action for which such Professionals were retained) for services rendered or expenses incurred after the Effective Date in the ordinary course of business without any further notice to any party or action, order or approval of the Bankruptcy Court, and (ii) the Creditors’ Fund Trustee may employ and pay any Professional from the Creditors’ Fund Trust Assets for services rendered or expenses incurred after the Effective Date without any further notice to any party or action, order or approval of the Bankruptcy Court.
3. Statutory Fees
On or before the Effective Date, Administrative Claims for fees payable pursuant to 28 U.S.C. § 1930 will be paid by the applicable Debtors in Cash equal to the amount of such Administrative Claims. Fees payable pursuant to 28 U.S.C. § 1930 for each Debtor’s Estate after the Effective Date will be by the Post-Confirmation Debtors until the closing of the applicable Chapter 11 Case pursuant to section 350(a) of the Bankruptcy Code.
4. Payment of Priority Tax Claims a. Priority Tax Claims
Pursuant to section 1129(a)(9)(C) of the Bankruptcy Code, unless otherwise agreed by the Holder of a Priority Tax Claim and the Debtors, each Holder of an Allowed Priority Tax Claim shall receive, at the option of the Debtors, in full satisfaction of its Allowed Priority Tax Claim that is due and payable on or before the Effective Date, on account of and in full and complete settlement and release of such Claim, (i) Cash in an amount equal to the amount of such Allowed Priority Tax Claim or (ii) Cash in an aggregate amount of such Allowed Priority Tax Claim payable in installment payments over a period of time not to exceed five years after the Petition Date, pursuant to section 1129(a)(9)(C) of the Bankruptcy Code; 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 by the Post-Confirmation Debtors as they become due, except as otherwise agreed by the Post-Post-Confirmation Debtors; provided,
further, that, in the event an Allowed Priority Tax Claim is also a Secured Tax Claim, such Claim shall, to the extent
it is Allowed, be treated as an Other Secured Claim if such Claim is not otherwise paid in full.
b. Other Provisions Concerning Treatment of Priority Tax Claims
B. Classification of Claims and Interests 1. General
Pursuant to sections 1122 and 1123 of the Bankruptcy Code, Claims and Interests are classified for voting and distribution pursuant to this Plan, as set forth herein. A Claim or Interest shall be deemed classified in a particular Class only to the extent that the Claim or Interest qualifies within the description of that Class and shall be deemed classified in a different Class to the extent that any remainder of such Claim or Interest qualifies within the description of such other Class. Holders of Allowed Claims may assert such Claims against each Debtor obligated with respect to such Claim, and such Claims shall be entitled to share in the recovery provided for the applicable Class of Claims against each obligated Debtor based upon the full Allowed amount of the Claim. Except as otherwise specifically provided for herein, the Confirmation Order or other order of the Bankruptcy Court, or required by applicable bankruptcy law, in no event shall the aggregate value of all property received or retained under the Plan on account of an Allowed Claim exceed 100% of the underlying Allowed Claim.
Section 1129(a)(10) of the Bankruptcy Code shall be satisfied for the purposes of Confirmation by acceptance of the Plan by an Impaired Class of Claims; provided, however, that in the event no Holder of a Claim with respect to a specific Class timely submits a Ballot in compliance with the Disclosure Statement Order indicating acceptance or rejection of this Plan, such Class will be deemed to have accepted this Plan. The Debtors may seek Confirmation of this Plan pursuant to section 1129(b) of the Bankruptcy Code with respect to any rejecting Class of Claims or Interests.
To the extent a Holder has Claims arising from the same transaction or occurrence that may be asserted against more than one Debtor, the vote of such Holder in connection with such Claims will be counted as a vote of each such Claim against each applicable Debtor against which such Holder has a Claim. The Plan assigns a letter to each Debtor and a number to each of the Classes of Claims against or Interests in the Debtors. For consistency, similarly designated Classes of Claims and Interests are assigned the same number across each of the Debtors. Any non-sequential enumeration of the Classes is intentional to maintain consistency.
2. Identification of Classes of Claims Against and Interests in the Debtors
The following table designates the Classes of Claims against and Interests in the Debtors and specifies which Classes are (a) Impaired or Unimpaired by this Plan, (b) entitled to vote to accept or reject this Plan in accordance with section 1126 of the Bankruptcy Code or (c) deemed to accept or reject this Plan.
Class Designation Impairment Entitled to Vote
1 Other Priority Claims Unimpaired Deemed to Accept
2 Other Secured Claims Unimpaired Deemed to Accept
3 Prepetition Term Loan Secured Claims Impaired Entitled to Vote
4 General Unsecured Claims Impaired Entitled to Vote
5 Intercompany Claims Impaired Deemed to Reject
6 Interests Impaired Deemed to Reject
Letter Debtor
A APP Winddown, LLC
B APP USA Winddown, LLC
C. Treatment of Claims
1. Other Priority Claims (Class 1)
a. Classification: Class 1 consists of all Other Priority Claims against the
respective Debtors.
b. Treatment: On the later of (a) the Effective Date, and (b) the date on which such
Other Priority Claim becomes an Allowed Other Priority Claim, or as soon as reasonably practicable thereafter, unless otherwise agreed to the Holder of an Allowed Other Priority Claim and by the Debtors or the Reorganized Debtors, in either case with the consent of the Required Lenders, each Holder of an Allowed Other Priority Claim against a Debtor shall receive on account and in full and complete settlement and release of such Claim, Cash in the amount of such Allowed Other Priority Claim in accordance with section 1129(a)(9) of the Bankruptcy Code.
c. Voting: Claims in Class 1 are Unimpaired. Each Holder of an Allowed Claim
in Class 1 is conclusively presumed to have accepted the Plan pursuant to section 1126(f) of the Bankruptcy Code and is, therefore, not entitled to vote.
2. Other Secured Claims (Class 2)
a. Classification: Class 2 consists of all Other Secured Claims against the
respective Debtors.
b. Treatment: On the later of (a) the Effective Date and (b) the date on which such
Other Secured Claim becomes an Allowed Other Secured Claim, or as soon as reasonably practicable thereafter, unless otherwise agreed by the Holder of an Allowed Other Secured Claim and by the Debtors or the Post-Confirmation Debtors, in either case with the consent of the Required Lenders, each Holder of an Allowed Other Secured Claim shall receive the following treatment at the option of the Debtors, with the consent of the Required Lenders: (i) payment in full (in Cash) of any such Allowed Other Secured Claim; (ii) satisfaction of any such Allowed Other Secured Claim by delivering the collateral securing any such Allowed Other Secured Claim and paying any interest required to be paid under section 506(b) of the Bankruptcy Code; or (iii) such other recovery necessary to satisfy section 1129 of the Bankruptcy Code to render such claim unimpaired.
c. Voting: Claims in Class 2 are Unimpaired. Each Holder of an Allowed Claim
in Class 2 is conclusively presumed to have accepted the Plan pursuant to section 1126(f) of the Bankruptcy Code and is, therefore, not entitled to vote.
3. Prepetition Term Loan Secured Claims (Class 3)
a. Allowance: Pursuant to the Final DIP Order, the Prepetition Term Loan Secured
Claims are Allowed Claims, and shall be deemed to be Allowed Claims under the Plan on the Effective Date. b. Classification: Class 3 consists of all Prepetition Term Loan Secured Claims
against the respective Debtors.
c. Treatment: Unless otherwise agreed by the Holder of an Allowed Prepetition
Recovered Cash Collateral) and (ii) all Recovered Cash Collateral not distributed to the Standard General Parties pursuant to this Section II.C.3.c. If the amount of Cash available for a Prepetition Term Loan Distribution exceeds the Allowed Prepetition Term Loan Secured Claims, then the Holders of Prepetition Term Loan Secured Claims shall be entitled, to one or more Prepetition Term Loan Distributions in an amount equal to Prepetition Term Loan Interest Claim, which additional, distribution shall be allocated 90% to the Lender Committee Parties and 10% to the Standard General Parties, until either Prepetition Term Loan Interest Claims of either the Lender Committee Parties or the Standard General Parties are paid in full, and thereafter to the Prepetition Term Loan Lenders whose Prepetition Term Loan Interest Claims have not been satisfied in full.
c. Voting: Claims in Class 3 are Impaired. Each Holder of an Allowed Claim in
Class 3 is entitled to vote.
4. General Unsecured Claims (Class 4)
a. Classification: Class 4 consists of all General Unsecured Claims against the
respective Debtors.
b. Treatment: Each Holder of an Allowed General Unsecured Claim shall receive,
in full satisfaction, settlement, and release of, and in exchange for, such General Unsecured Claim, its Pro Rata Share of the Net Class 4 Distributable Creditors’ Fund Cash, up to the Allowed amount of said Holder’s General Unsecured Claim; provided, however, that pursuant to the UCC-LT Settlement, members of the Committee of Lead Lenders that are Holders of Prepetition Term Loan Deficiency Claims shall not receive a distribution on account of such Prepetition Term Loan Deficiency Claims, and any such Prepetition Term Loan Deficiency Claims held by members of the Committee of Lead Lenders shall not count as General Unsecured Claims for distribution purposes.
c. Voting: Claims in Class 4 are Impaired. Each Holder of an Allowed Claim in
Class 4 is entitled to vote.
5. Intercompany Claims (Class 5)
a. Classification: Class 5 consists of all Intercompany Claims against the
respective Debtors.
b. Treatment: Intercompany Claims shall be cancelled, reinstated or modified, in
the discretion of the Reorganized Debtors, and no distribution shall be made on account of such Claims.
c. Voting: Holders of Intercompany Claims are Impaired, and such holders of
Intercompany Claims are deemed to have rejected the Plan pursuant to section 1126(g) of the Bankruptcy Code. Therefore, each holder of an Intercompany Claim will not be entitled to vote to accept or reject the Plan.
6. Interests (Class 6)
a. Allowance: Interests shall be Allowed in the amounts set forth on the respective
Schedule of Equity Security Holders of each of the Debtors, and with respect to Interests in APP Winddown, LLC, in the operating agreement set forth in the Plan Supplement.
b. Classification: Class 6 consists of all Allowed Interests in the respective Debtors.
c. Treatment: Interests in a Debtor shall be cancelled if and when such Debtor is
