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Case 1 20-bk-12043 Doc 573-2 Filed 01/13/21 Entered 01/13/2111 03 53 Desc Case 1,20-bk-12043 Doc 573-2 Filed 01/13/21 Entered 01/13/2111 03.53 Desc
<br />Exhibit B -Declaration of Thomas Fairfield Page 4 of 17 Exhibit B -Declaration of Thomas Fairfield Page 5 of 17
<br />among other things, the Plan, events preceding the commencement of these Chapter l l Cases,
<br />claims against the Debtors' estates, estimated recoveries for creditors under the Plan, nsk factors
<br />affecting the Plan, and federal tax consequences of the Plan Creditors entitled to vote were
<br />provided with a clear description of the Debtors' liquidation, the liquidating trustee, risks involved
<br />in the plan process, and all legal aspects of the Plan
<br />7 I understand that section 1125 of the Bankruptcy Code requires that proponents of
<br />a chapter 11 plan provide holders of impaired claims and interests entitled to vote on a plan with
<br />"adequate information" regarding a plan Based on my review of the Disclosure Statement and my
<br />discussions with the Proponents' legal and financial advisors, I believe the Disclosure Statement
<br />contains adequate information and satisfies the requirements of the Bankruptcy Code and should
<br />be approved by this Court on a final basis
<br />III. MODIFICATIONS TO THE PLAN
<br />S Based on my discussions with the Plan Proponents' legal counsel, I understand that
<br />the Bankruptcy Code generally allow a proponent of a plan to modify the plan at any point prior
<br />to confirmation ifsuch modifications do not adversely change the treatment of a claim of a creditor
<br />or interest of an equity bolder
<br />9 During the solicitation process of the Plan, I understand that the Plan Proponents
<br />received requests from various parties in interest in modify certain provisions of the Plan in lieu
<br />of those parties filing an objection to the Plan (collectively, the "Modifications") I have reviewed
<br />the requested Modifications and believe those Modifications are non-matenal and do not adversely
<br />change the treatment of any claims or Nutty interests under the Plan Therefore, I believe this
<br />Court should approve the Modifications to the Plan
<br />E'
<br />Case 1 20-bk-12043 Doc 573-2 Filed 01/13/21 Entered 01/13/21 11 03 53 Desc
<br />Exhibit B -Declaration of Thomas Fairfield Page 6 of 17
<br />13 I understand that section 1123(a) of the Bankruptcy Code sets fortb various
<br />requirements regarding the appropriate contents oft plan I believe that the Plan satisfies each of
<br />these requirements
<br />14 The Plan (a) designates the different Classes of Claims and Equity Interests, (b)
<br />specifies the Classes of Claims that are unimpaired under the Plan, and (c) specifies the treatment
<br />of each Class of Claims and Equity Interests that are impaired In addition, the treatment of each
<br />Claim against or Equity Interest in the Debtors in each respective Class is the same as the treatment
<br />of each other Claim or Equity Interest unless the Holder of such Claim or Equity Interest has
<br />agreed to a less favorable treatment for such Claim or Equity Interest
<br />15 I believe the Plan provides adequate means for its implementation as required by
<br />section 1123(a)(5), including, without hrmtation, (a) the establishment of the Liquidating Trust
<br />and the appointment of the Liquidating Trustee, (b) the transfer of the Liquidating Trust Assets to
<br />the Liquidating Trust, to be administered in accordance with the terms of the Plan and the
<br />Liquidating Trust Agreement for the benefit of Holders of Allowed Claims, and (c) procedures for
<br />making distributions to holders of Allowed Claims I believe the proposed implementation steps
<br />have been carefully developed and designed to properly effect the Plan
<br />16 As noted above, the Plan provides for the transfer of Liquidating Trust Assets to
<br />the Liquidating Trust, to be liquidated and distributed in accordance with the Plan and the
<br />Liquidating Trust Agreement Therefore, the Plan does not expressly provide for the inclusion in
<br />the charter of any Debtor provisions prohibiting the issuance of nonvoting securities Nonetheless,
<br />because the Plan does not provide for the issuance of any securities, the issuance of nonvoting
<br />securities is impossible
<br />IV. SATISFACTION OF PLAN CONFIRMATION REQUIREMENTS
<br />10 Based on my review of the Plan and related materials and my discussions with the
<br />Plan Proponents' legal and financial advisors, I believe that the Plan satisfies all applicable
<br />provisions o£the Banlwptcy Code and should be confirmed
<br />A. Compliance with Section 1129(a)(1) of the Bankruptcy Code
<br />11 I understand that section 1122 of the Bankmptcy Code permits a plan to classify
<br />various claims and equity interests into different classes so long as all claims and interests in a
<br />particular class are substantially similar The Plan provides for the separate classification of
<br />Claims and Equity Interests in the Debtors based on differences in legal nature and/or pnonty of
<br />such Claims and Equity Interests. The Plan designates the following Classes of Claims and
<br />Interests
<br />(t) Class l—Other Pnority Claims
<br />(it) Class 2—Secured Claims
<br />(tit) Class 3—DIP Lender Claims
<br />(Iv) Class 4—Piepetrtion Lender Claims
<br />(v) Class 5—General Unsecured Claims
<br />(vi) Class 6—Equity Interests
<br />12 1 believe that valid business, factual, and legal reasons exist for classifying the
<br />Claims and Equity Interests into separate Classes as provided in the Plan and that the Claims and
<br />Equity Interests within each particular Class are substantially similar. Furthermore, 1 believe the
<br />classification scheme created by the Plan is based on the similar nature of Claims or Equity
<br />Interests contained in each Class and not on an impermissible classification factor
<br />4
<br />4919-14et A9341
<br />Case 1 20-bk-12043 Doc 573-2 Filed 01/13/21 Entered 01/13/21 11 03 53 Desc
<br />Exhibit B -Declaration of Thomas Fairfield Page 7 of 17
<br />17 On December 15, 2020, the Committee filed the Notice of Filing of Selection of
<br />Liquidating Trurtee andLiquidainig Tntst BoamdRepreseatatmes andFdmgofFia mLiguidating
<br />Trust Agreement (Docket No 563) (the "Liouidatine Trust Notice"), and I believe the
<br />appointment of the Liquidating Tmstce is consistent with the interests of creditors and with public
<br />policy
<br />Is Section 701 of the Plan deals with the rejection of Executory Contracts and
<br />Unexpired Leases, and provides that all Executory Contracts and Unexpired Leases, other than
<br />those previously rejected or referenced in the Plan, shall be deemed rejected on the Effective Date
<br />19 I understand that section 1123(b) of the Bankruptcy Code enumerates various
<br />discretionary provisions that maybe included in a chapter 11 plan I also understand that the Plan
<br />contains various provisions in accordance with the discretionary authority granted under section
<br />1123(b) ofthe Bankruptcy Code
<br />20. The majority of the relief requested related to exculpation and releases has been
<br />previously approved by this Court On November 2, 2020, the Court entered the Or der Apprormg
<br />Settlement Agreement with Prepention Secured Parties and DIP Secured Parnes, Puisuant to
<br />Bankraplev Rule 9019 (Doc No 483) (Docket No 504) (the "Released Party Order') which
<br />approved a settlement agreement between the Debtors, the Committee and the Released Parties
<br />(the"Released Party Settlement") In pan, the Released Party Order approved the Released Party
<br />Settlement which contained a release of claims against the Released Parties In exchange for such
<br />release, the Released Panics agreed to (i) the immediate payment of $400,000 to the Debtors
<br />estates, (it) the payment of $100,000 to the Debtors estates upon the Effective Date of a plan,
<br />provided that the confirmed plan contain a thud party release and other provisions consistent with
<br />the Released Party Settlement, and (ni) released all claims against the Debtors' estates, subject to
<br />6
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