2020-10-20_GENERAL DOCUMENTS - C1980004 (2)

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ii. Tax Consequences. The tax consequences of the Plan are discussed hereinbelow. Creditors and interest holders may be subject to significant federal, state and local tax consequences as a result of the Plan. Because the tax consequences to each creditor may vary based on their individual circumstances, creditors are urged to consult their own tax advisors about the tax effect of the Plan. See " CERTAIN FED ERAL INCOME TAX CONSEQUENCES OF THE PLAN." iii. Alternatives to the Plan. The Debtor or, with Court approval, an y other party in interest, may file an alternative Chapter 11 Plan. if no Chapter 11 Plan is confirmed, the bankruptcy case could be dismissed and creditors would be entitled to pursue their claims against the Debtor under state law. Alternatively, the bankruptcy case could be converted to Chapter 7. under which certain of the Debtor's assets could be liquidated. See "ALTER NATIVES TO THE PLAN." iv. Confirmation of the Plan. A prerequisite to confirmation of the Plan is the acceptance of the Plan by one or more class of claims that is impaired by the Plan. A class of impaired claims will be deemed to have accepted the Plan if a majority in number and two-thirds in dollar amount of the allowed claims of the class that actually vote have voted to accept the Plan. If confirmed, the Plan will be binding on all holders of claims and interests, including holders that did not vote or holders that voted against the Plan. In addition, the Court may. under certain circumstances and at the request of the Debtor, confirm the Plan despite the failure of one or more impaired classes of claims to accept the Plan. It is important that you exercise your right to vote to accept or reject the Plan. A ballot. together with instructions for voting, accompanies this Disclosure Statement. You should read the ballot carefully and follow the instructions. For detailed information regarding acceptance and confirmation of the Plan and the voting process see. "ACCEPTANCE OF THE PLAN AND CONFIRMATION." "VOTING INSTRUCT IONS AND PROCEDURES," and "ADDITIONAL INFORMATION." II. BACKGROUND OF THE DEBTOR AND PRE -PETITION EVENTS. A. Background. The Debtor has been in the mining business for over a decade. Todd C. Hennis was the chief executive officer of the Debtor during the years 2007 and 2008. Mr. Hennis left the Debtor over a dispute with Lee R. Rice, who died on August 20, 2014, and S. Stephen Guyer, who were in control of the Debtor during the years immediately before the bankruptcy case. At one time. the Debtor owned the Pride of the West mill (the " Mill") and was in the business of milling ore. The Debtor' s equities were publicly traded as a 2