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March 3, 1993 B(f<ctive Date of Deb[ors' Confirmed Plan (the "Runout Claims"), leaving a
<br />balance, before earnings, of 5679,996.00 (the "Adjusted Estimated Prescription Drug Surplus).
<br />The Reorganved Debtors retained the accounting fum of Schneider
<br />Downs & Co., Int. ('Schneider Downs"), Cenifed Public Accountants, 1133 Penn Avenue,
<br />Pittsburgh, PA 15222, to wnducl a review and analysis of the Participants' Contributions to
<br />the Dmg Pmgram, to determine the paymenu made therefrom, to calculate the acmal amount
<br />of the unused portion of the-Panicipants' Contributions to the Dmg Program and to prepare~a
<br />distribution plan with respect to such funds.
<br />12 Based on Schneider Downs' review and analysis, Schneider Downs
<br />determined Ihal taking into consideration the Runoul Claims, the actual amount of the surylus,
<br />before cmnsideration of earnings on (he surplus since Math, 1993 was 5637,755.97;
<br />accordingly, Schneider Downs end Reorganized Debmrs believe that of the Adjusted Ptimated
<br />Prexripfion Dmg Surplus, 93.73% (5637,355.97 - 5679,998.(10 = 93.77%) thereof should
<br />be allocated to the Panicipanu end 6.27% to Reorganized CF&f As of January 22, 1999, the
<br />Adjustod Pstimated Prescription Dmg Surplus with eaminrgs had grown to 5887,044.75.
<br />Therefore, Ne Reorganized Dehtors believe the arM1,el value of the unused portion of the
<br />Participanu' Contributions to the Dmg Pmgram az of January 22, 1999 is 5827,677.84
<br />(5883,044.75 x ,9373), which 5827,667.84 amount, together with comings that accme after
<br />January 22, 1999, is hereinafter referral to az the "Prescnipton Dmg Fund".
<br />17. Based on prior experience with the distribution of funds from the CF&I
<br />VEBA (the "Old VEBA") end proceeds From the litigation wrth th<Equiuble life Assurance
<br />Society of the United Statu, the Reorganized Debtors believe the pre(erablc way to develop a
<br />distribution plan with respect to the Prescription Drug Fund is to first delemdne which
<br />Participants can be located and verify their address, and to the extent any Participant is now
<br />deceased, to determine whethtt the heirs of such Partictpant entitled to receive such Participant's
<br />share o(any distribution can be identified and located Accordingly, the Reorganized Debtors
<br />seek an ordtt approving the procedure for identifying Participants or heirs of Participants.
<br />14. The Reorganized Debtors propose to send a letter and an information form,
<br />copres o(which are attached hereto and incorporated herein by reference az Exhibit "C", to each
<br />person who has been identified es a Participant in the Drug Program. In order to avoid additional
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<br />I5. Upon receiving the wmpleted forms and any supplemental information that
<br />may he required and identifying Participants or their heirs that have been located, tfie Reorganized
<br />Debtors propose to develop a distribution plan involving those individuals who have been
<br />identified end located, which plan will then be filed with the Court (or approval.
<br />16. Because this is a motion for a preliminary order and is primarily procedural
<br />in nature, the Reorganvrd Debtors ere oNy serving copies of the motion on those entities listed
<br />on Master Mailing Matrix No. 57, the USWA, and wunsel for the New VEBA However, once
<br />the Court has approved this Malian for a prelindnary order, all Participants known to the
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<br />Bazed on the foregoing, the Reorganized Debtors believe it is appropriate for the
<br />Court to enter a preliminary order in aid of consummation of Debtors' Confirmed Plan (i)
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