1994-02-06_GENERAL DOCUMENTS - C1981017

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advances were used by the Debtor to pay all fees paid to Fairfield and Woods, P.C. and a portion of the fees paid to Holden & Jessop, P.C. and Delaney and Balcomb, P.C. Under the Plan, Minerals will not be reimbursed for these advances. The fees and costs in the case actually borne or to be borne by the Debtor's bankruptcy estate thus are estimated at $225,000. Subject to Court allowance, it is estimated that approximately $195,000 of unpaid fees and expenses would be due on the Effective Date. With the exception of the Sherman & Howard's final fees which previously have been approved, the final allowance of fees and expenses most likely will not occur until after the Effective Date. 2. Tax Priority Claims The Bankruptcy Code requires that tax claims of governmental entities entitled to priority pursuant to Section 507 (a) (7) of the Bankruptcy Code be paid, at minimum, in deferred cash payments over a period of six years from the date of tax assessment, with interest. The Plan provides for such payment, with interest from the Effective Date calculated at the rate of 6% per annum. Priority tax claims scheduled by the Debtor include the claim of the Colorado Department of Revenue for 1990 severance taxes, in the amount of $72,553; the claim of the Colorado Department of Revenue for sales and use taxes during the period of 1987-1990, in the amount of $264,373; and the claim of the United States Government, Office of Surface Mining Reclamation and Enforcement, for 1990 reclamation taxes in the amount of $24, 113. A portion of the Colorado sales and use taxes may fall outside the statutory three year period for tax priority, and to that extent would be a general unsecured claim. C. Creditors' Trust The Plan establishes a Creditors' Trust on the Effective Date. With only a few limited exceptions, the Creditors' Trust is given custody of the Debtor's assets and is given the power to sell those assets. The proceeds of sale are distributed by the Creditors' Trust in accordance with the Plan. Certain assets of the Debtor are transferred outright into the Creditors' Trust on the Effective Date of the Plan. These assets include all cash of the Debtor not required to be distributed by the Debtor on the Effective Date. See Section II.F. 1, "Effective Date, " below. These assets also include all claims of the Debtor which might be asserted through litigation, such as avoidance claims arising under the Bankruptcy Code. Other assets of the Debtor nominally continue to reside in the Debtor for title purposes, but the power to sell those assets is given to the Creditors' Trust through an irrevocable 29