Attached files
UNITED STATES BANKRUPTCY COURT
FOR THE DISTRICT OF COLORADO
In re: RANCHER ENERGY, CORP., ) Case No. 09-32943 MER
)
Debtor. ) Chapter 11
)
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DEBTOR'S SECOND AMENDED PLAN OF REORGANIZATION
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Pursuant to Chapter 11, Title 11 of the United States Code, 11 U.S.C. ss.
l01 ET SEQ., Rancher Energy Corp., debtor and debtor in possession in the
above-captioned bankruptcy case, hereby proposes the following Second Amended
Plan of Reorganization ("Plan" or "Amended Plan"). The Debtor is the Plan
proponent within the meaning of 11 U.S.C. ss. 1129. A detailed discussion of the
Debtor's history, business, historical financial information and other pertinent
information, as well as a summary and analysis of this Plan, are set forth in
the Disclosure Statement for Second Amended Plan of Reorganization ("Disclosure
Statement") filed with this Plan.
ARTICLE 1
GENERAL
A. DEFINITIONS
The following terms, when used in this Plan or any subsequent amendments or
modifications thereof, and in addition to those terms defined in the text of
this Plan, shall have the respective meanings hereinafter set forth.
1.1. "ADMINISTRATIVE CLAIM" means a Claim for costs and expenses of
administration allowed under ss.ss. 503(b) and 507(a)(1) including, without
limitation, (a) any actual, necessary costs and expenses of preserving the
Estate, (b) any indebtedness or obligations incurred or assumed by the Debtor in
the ordinary course of business in connection with the conduct of its business
during the Bankruptcy Case, (c) any Professional Fee Claims, and (d) any fees or
charges assessed against the Debtor's Estate under ss. 1930, chapter 123, title
28, United States Code.
1.2. "ADVERSARY SETTLEMENT AGREEMENT" means the settlement agreement dated
on or about June 8, 2012 between Linc, GasRock and Debtor settling that action
styled adversary proceeding No. 10-01173-MER RANCHER ENERGY CORP. V. GASROCK
CAPITAL, LLC.
1.3. "ALLOWED" means, with respect to any Claim (including any
Administrative Claim), (a) a Claim against the Debtor, proof of which was filed
within the applicable period of limitation fixed by the Bankruptcy Court in
accordance with Rule 3003(c)(3) of the Bankruptcy Rules (i) as to which, no
objection to the allowance thereof has been interposed within the applicable
period of limitation fixed by this Plan, the Bankruptcy Code, the Bankruptcy
Rules, or a Final Order, (ii) as to which no timely objection has been
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interposed based upon 11 U.S.C. ss. 502(d), and (iii) as to which an objection
had been interposed, to the extent such Claim has been allowed (whether in whole
or in part) by a Final Order, (b) if no proof of such Claim was filed timely or
was withdrawn, any Claim against the Debtor which is listed by the Debtor in the
Schedules, as such Schedules may be amended from time to time in accordance with
Rule 1009 of the Bankruptcy Rules, as liquidated in amount and not disputed or
contingent, (c) any Claim arising from the recovery of property under ss.ss. 550
or 553 of the Bankruptcy Code and allowed in accordance with ss. 502(b) of the
Bankruptcy Code, (d) any Claim allowed under or pursuant to the terms of this
Plan, or (e) any other Claim that has been allowed by a Final Order.
1.4. "ASSET POOL" means that pool of cash or cash equivalents and other
distributable assets, e.g. stock, of Rancher, at all times net of current
accrued expenses and a reasonable reserve for future expenses necessary to carry
out this Plan as determined by the Board, consistent with its obligation under
Section 5.3 to cause full payment of all Allowed Class 4(a) Claims and to
reserve for all Class 4(a) and (c) Disputed Claims before undertaking any other
business.
1.5. "BANKRUPTCY CASE" means In Re: Rancher Energy Corp., Case Number
09-32943 MER.
1.6. "BANKRUPTCY CODE" means Title 11 of the United States Code, as
amended, in 0effect and applicable to the Bankruptcy Case concerning the Debtor.
1.7. "BANKRUPTCY COURT" means the United States Bankruptcy Court for the
District of Colorado.
1.8. "BANKRUPTCY RULES" means the Federal Rules of Bankruptcy Procedure.
1.9. "BAR DATE" means March 5, 2010, the date fixed by the Bankruptcy Court
as the last date by which Claimants could file proofs of claim, unless the Court
set a different date by which a specific Claimant must file a proof of claim, in
which case it means, for the specific Claimant, such different date set by the
Court.
1.10. "BOARD" means the Board of Directors of Rancher, as constituted from
time to time.
1.11. "BUSINESS DAY" means any day other than a Saturday, Sunday or other
day on which commercial banks in Denver, Colorado are required or authorized by
law to be closed.
1.12. "CASH" means legal tender of the United States, including amounts on
deposit at financial institutions in checking accounts, money market accounts
and the like.
1.13. "CAUSES OF ACTION" means any and all Claims, rights, actions, chose
in action, suits, causes of action, liens, judgments, insurance coverage claims,
and damages belonging to the Debtor or its Estate and any and all liabilities,
obligations, covenants, undertakings and debts owing to the Estate, whether
arising prior to or after the Petition Date and in each case whether known or
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unknown, in law, equity or otherwise, including but not limited to all causes of
action pursuant to ss.ss. 544 through 553 of the Bankruptcy Code.
1.14. "CLAIM" means: (a) right to payment from either Debtor, whether or
not such right is reduced to judgment, liquidated, unliquidated, fixed,
contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured,
or unsecured; or (b) right to an equitable remedy for breach of performance if
such breach gives rise to a right to payment, whether or not such right to an
equitable remedy is reduced to judgment, fixed, contingent, matured, unmatured,
disputed, undisputed, secured, or unsecured. "Claim" shall not include unmatured
or unearned interest as of the Petition Date on the amount of any Claim except
as permitted by the Bankruptcy Code or except as expressly provided otherwise in
this Plan.
1.15. "CLAIMANT" means the holder of a Claim against the Debtor.
1.16. "CLASS" means a category of Claims or Interests described in Article
3 hereof.
1.17. "CONFIRMATION DATE" means the date on which the Clerk of the
Bankruptcy Court enters the Confirmation Order on the docket corresponding to
the Bankruptcy Case.
1.18. "CONFIRMATION ORDER" means the order of the Bankruptcy Court
confirming this Plan, or any amendment thereto, pursuant toss.1129 of the
Bankruptcy Code.
1.19. "DEBTOR" means Rancher Energy Corp., debtor in possession in the
Bankruptcy Case.
1.20. "DISCLOSURE STATEMENT" means the disclosure statement and all
exhibits thereto filed in this case pursuant to ss. 1125 of the Bankruptcy Code
and approved by the Bankruptcy Court, as may be amended or modified from time to
time by any duly authorized amendment or modification.
1.21. "DISPUTED" means, as to a Claim: (a) if such Claim is not an Allowed
Claim as of a particular point in time; (b) if no proof of claim has been filed
by the Bar Date or has otherwise been deemed timely filed under applicable law,
(i) that is listed on the Debtor's Schedules as disputed, contingent or
unliquidated, or (ii) that is not listed on the Debtor's Schedules; or (c) if a
proof of Claim has been filed by the Bar Date or has otherwise been deemed
timely filed under applicable law, for which an objection, complaint or request
for estimation has been filed by the Debtor or any other party in interest
within 270 days after the Effective Date (or such later date the Bankruptcy
Court allows upon motion by the Debtor), and such objection has not been
withdrawn or denied in its entirety by Final Order.
1.22. "DISPUTED CLAIMS RESERVE" means the segregated interest bearing
accounts established by the Debtor consistent with Section 9.6 of this Plan.
1.23. "DISTRIBUTION" means any distribution to a Class made pursuant to
this Plan.
1.24. "EFFECTIVE DATE" means the thirtieth (30th) day, or such earlier date
specified by the Debtor by notice filed with the Bankruptcy Court if such day is
a Business Day, and otherwise the first Business Day after such thirtieth (30th)
day, after (a) the Confirmation Order (together with other orders entered in aid
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of Confirmation of this Plan, and signed contemporaneously with the Confirmation
Order) has been entered pursuant to Bankruptcy Rules 5003 and/or 9021; and (b)
all conditions precedent have been satisfied or waived as provided in Article 8
hereof.
1.25. "ESTATE" means the Debtor's estate created pursuant to ss. 541 of the
Bankruptcy Code upon the Petition Date.
1.26. "FINAL ORDER" means an order or judgment of a court as to which the
time to appeal, petition for certiorari, or move for reargument or rehearing has
expired and as to which no appeal, petition for certiorari or other proceedings
for reargument or rehearing shall then be pending; provided that if an appeal,
or writ of certiorari, reargument or rehearing thereof has been filed or sought,
such order of a court shall have been affirmed by the highest court to which
such order was appealed, or certiorari shall have been denied or reargument or
rehearing shall have been denied or resulted in no modification of such order,
and the time to take any further appeal, petition for certiorari or move for
reargument or rehearing shall have expired; provided, further, 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 with respect to
such order shall not cause such order not to be a Final Order.
1.27. "GASROCK" means Magma Assets, LLC, formerly known as GasRock Capital
LLC, its successors and assigns.
1.28. "GENERAL UNSECURED CLAIM" means any Claim against the Debtor that is
not an Administrative Claim, Priority Unsecured Tax Claim, Priority Non-Tax
Claim, Professional Fee Claim or Secured Claim.
1.29. "INTEREST" means the rights and interests of a holder of stock in the
Debtor.
1.30. "LINC" means Linc Energy Petroleum (Wyoming), Inc., a Delaware
corporation, or its assigns.
1.31. "PERSON" means any individual, corporation, partnership, association,
joint venture, limited liability company, limited liability partnership, estate,
trust, unincorporated organization or governmental unit or subdivision thereof
or other entity.
1.32. "PETITION DATE" means October 28, 2009, the date upon which the
Debtor filed its voluntary petition for relief under Chapter 11 of the
Bankruptcy Code.
1.33. "PLAN" means this plan of reorganization, as the same may be amended
or modified from time to time by any duly authorized amendment or modification.
1.34. "PRIORITY NON-TAX CLAIM" means a Claim which is entitled to priority
treatment under ss. 507(a) of the Bankruptcy Code, excluding Claims entitled to
priority under Bankruptcy Code ss.ss. 507(a)(1) and 507(a)(8).
1.35. "PRIORITY UNSECURED TAX CLAIM" means a Claim or a portion of a Claim
which is entitled to priority under ss. 507(a)(8) of the Bankruptcy Code.
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1.36. "PROFESSIONAL FEE CLAIM" means any Claim of a Professional retained
in the Bankruptcy Case pursuant to ss.ss. 327 or 1103 of the Bankruptcy Code,
for compensation or reimbursement of costs and expenses relating to services
incurred prior to and including the Effective Date, when and to the extent any
such Claim is Allowed by the Bankruptcy Court pursuant to ss.ss. 329, 330, 331,
503(b), or 1103 of the Bankruptcy Code.
1.37. "PROFESSIONAL" means a professional person duly retained by the
Debtor during the Bankruptcy Case pursuant to an order of the Court authorizing
same.
1.38. "PRO RATA" means, in connection with a particular Allowed Claim and
in connection with any Distribution, the ratio between the amount of such
Allowed Claim and the aggregate amount of all Allowed Claims in such Class
entitled to such Distribution.
1.39. "RANCHER" means Rancher Energy Corp., Debtor and Debtor in Possession
in this Bankruptcy Case.
1.40. "RECORD DATE" means the date set by Bankruptcy Rule 3018(a) for
purposes of voting.
1.41. "SCHEDULED CLAIM" means a Claim that is listed by the Debtor in the
Schedules.
1.42. "SCHEDULES" means the schedules of assets and liabilities, schedules
of executory contracts and unexpired leases, statements of financial affairs and
other schedules and statements filed by the Debtor pursuant to Federal Rule of
Bankruptcy Procedure 1007, and any amendments thereto.
1.43. "SECURED CLAIM" means a Claim secured by a lien, as that term is
defined in ss. 101(37) of the Bankruptcy Code, including, but not limited to, a
judicial lien as that term is defined at ss. 101(36) of the Bankruptcy Code,
against any property of the Estate, but only to the extent of the value, as
determined by the Bankruptcy Court pursuant to ss. 506(a) of the Bankruptcy Code
and Bankruptcy Rule 3012 or as otherwise agreed, of such Claimant's interest in
the Debtor's interest in such property.
1.44. "SHAREHOLDER LITIGATION GROUP CLAIMS" are the claims asserted in
proofs of claim numbers 38 through 49 and any amendments thereto.
B. RULES OF INTERPRETATION
For purposes of this Plan: (a) where appropriate in the relevant
context, each term, whether stated in the singular or the plural, will include
both the singular and the plural; (b) unless otherwise provided in this Plan,
any references in this Plan to a contract, instrument, release, indenture or
other agreement or document being in a particular form or on particular terms
and conditions means that such document will be substantially in such form or
substantially on such terms and conditions; (c) unless otherwise provided in
this Plan, any reference in this Plan to an existing document or appendix filed
or to be filed means such document or appendix, as it may have been or may be
amended, modified or supplemented pursuant to this Plan; (d) unless otherwise
specified herein, any reference to a Claimant or Interest holder includes that
Person's successors, assigns and affiliates; (e) unless otherwise specified, all
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references in this Plan to Sections and Articles are references to Sections and
Articles of this Plan; (f) the words "herein", "hereto" and "hereof" refer to
this Plan in its entirety rather than to a particular portion of this Plan; (g)
headings are utilized in this Plan for the convenience of reference only, and
shall not constitute a part of this Plan for any other purpose; and (g) the
rules of construction set forth in ss. 102 of the Bankruptcy Code will apply. To
the extent that this Plan is inconsistent with the Disclosure Statement, the
provisions of this Plan shall be controlling.
ARTICLE 2
PAYMENT OF CLAIMS NOT REQUIRED TO BE CLASSIFIED
2.2. CLAIMS NOT CLASSIFIED. No Class is designated for Administrative
Claims, Professional Fee Claims or Priority Unsecured Tax Claims.
2.3. ADMINISTRATIVE CLAIMS. The Debtor shall pay all Allowed Administrative
Claims, other than Professional Fee Claims, at Debtor's sole option in Cash, (a)
as soon as practicable following the later of the Effective Date or the date
upon which the Court enters a Final Order Allowing any such Administrative
Claim, or (b) as such Claims may be due according to their terms in the ordinary
course, or (c) as may be agreed upon between an Administrative Claim Claimant
and the Debtor. In the event any Disputed Administrative Claims exist on the
Effective Date, the Debtor shall at all times hold and maintain Cash in an
amount equal to that portion of the Disputed Claims Reserve attributable to all
Disputed Administrative Claims.
2.4. PROFESSIONAL FEE CLAIMS. Except as a Claimant with a Professional Fee
Claim agrees otherwise, the Debtor shall pay all Professional Fee Claims on or
before ten (10) Business Days after a Final Order approving such compensation
and reimbursement of expenses in accordance with Section 5.5 hereof. Except as a
Claimant with a Professional Fee Claim agrees otherwise, in the event any
Disputed Professional Fee Claim exists on the Effective Date, the Debtor shall
at all times hold and maintain Cash in an amount equal to that portion of the
Disputed Claims Reserve attributable to Disputed Professional Fee Claims.
ARTICLE 3
CLASSIFICATION AND VOTING OF CLAIMS AND INTERESTS
3.1. CRITERION OF CLASS. A Claim is in a particular Class only to the
extent that the Claim qualifies within the description of that Class and is in a
different Class to the extent that the remainder of the Claim qualifies within
the description of the different Class.
3.2. CLASS CATEGORIES. The following classes of Claims and Interests are
designated pursuant to and in accordance withss. 1123(a)(1) of the Bankruptcy
Code, which classes shall be mutually exclusive:
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CLASS CLAIM VOTING
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Class 1 Secured Claim of GasRock Unimpaired/Not Entitled to
Vote
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Class 2 Priority Wage Claims Impaired/Entitled to Vote
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Class 3(a) Wyoming State Dept. of Revenue - Impaired/Entitled to Vote
Unsecured
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Class 3(b) IRS Pre-Petition Tax Claims - Impaired/Entitled to Vote
Unsecured
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Class 3(c) All Other Pre-Petition Tax Claims - Impaired/Entitled to Vote
Unsecured
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Class 4(a) General Unsecured Claims Impaired/Entitled to Vote
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Class 4(b) BLM Unsecured Claim Impaired/Entitled to Vote
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Class 4(c) Allowed Late-Filed Unsecured Claims Impaired/Entitled to Vote
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Class 5 Interests (common shareholders) Impaired/Entitled to Vote
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Class 6 Interests (holders of options and Impaired/Entitled to Vote
warrants)
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Class 7 Employee/Retention Agreement Stock Unimpaired/Deemed to Accept
Options
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Class 8 Convertible Promissory Notes Impaired/Entitled to Vote
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Class 9 Shareholder Litigation Claims Impaired/Entitled to Vote
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3.3. VOTING OF CLAIMS AND INTERESTS. Each Claimant with an Allowed Claim
and Interest Holder with an Allowed Interest as of the last date set by the
Court on which a vote must be received in Classes 2, 3, 4, 5, 6, 8, and 9 shall
be entitled to vote to accept or reject this Plan.
3.4. PRESUMED ACCEPTANCES OF PLAN. Classes 1 and 7 are unimpaired under
this Plan and therefore is presumed to have accepted this Plan.
ARTICLE 4
TREATMENT OF CLASSES OF CLAIMS AND INTERESTS
The following treatment of and consideration to be received by Claimants of
Allowed Claims and Allowed Interests pursuant to this Plan shall be in full
settlement, release and discharge of such Allowed Claims and Allowed Interests.
4.1 CLASS 1 (GASROCK). Class 1 consists of the Allowed Claim, if any, of
GasRock for attorney's fees and costs. The Class 1 Claim shall be treated
consistent with the Adversary Settlement Agreement.
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4.2 CLASS 2 (PRIORITY WAGE CLAIMS). Class 2 shall consist of all Allowed
Claims entitled to priority under ss. 507(a)(4)(A) of the Code. Class 2 Claims
shall be paid their Pro Rata share of the Asset Pool monthly from time to time
to the extent the Asset Pool contains at least $1000, after payment of or
reserve for Administrative Claims, Professional Fee Claims, and Class 1. Any
Allowed Claim held by a Class 2 Claimant in excess of the amount entitled to
priority under ss. 507(a)(4) of the Code shall be treated as Class 4(a) Claim.
4.3 CLASS 3 (UNSECURED PRIORITY TAX CLAIMS).
A. CLASS 3(A) (WYOMING DEPARTMENT OF REVENUE). Class 3(a) consists
of the Allowed Claim of the State of Wyoming Department of
Revenue for taxes entitled to priority under ss.507(a)(8) of the
Code. Interest on the Class 3(a) Claim shall accrue from the
Petition Date at the rate specified by applicable Wyoming law and
shall be paid its Pro Rata share of the Asset Pool with all Class
3 Claims. Distributions to the Class 3(a) Claim(s) will be paid
on or before a date that is five years after the Petition Date.
B. CLASS 3(B) (INTERNAL REVENUE SERVICE). Class 3(b) consists of the
Allowed Claims of the Internal Revenue Service for taxes entitled
to priority under ss.507(a)(8) of the Code. Interest on the Class
3(b) Claims shall accrue from the Petition Date at the rate
specified in ss. 6621(a)(2) of the Internal Revenue Code in
effect on the Effective Date for any Allowed Claim of the
Internal Revenue Service. The Class 3(b) Claims shall be paid
their Pro Rata share of the Asset Pool with all Class 3 Claims.
Distributions to the Class 3(b) Claim(s) will be paid on or
before a date that is five years after the Petition Date.
C. CLASS 3(C) (OTHER TAX CLAIMS). Class 3(c) consists of any Allowed
Claims for taxes entitled to priority under ss. 507(a)(8) of the
Code not included in Classes 3(a) and 3(b). Interest on the Class
3(c) Claims shall accrue from the Petition Date at the rate
specified in applicable law and shall be paid their Pro Rata
share of the Asset Pool with all Class 3 Claims. Distributions to
the Class 3(c) Claim(s) will be paid on or before a date that is
five years after the Petition Date.
D. ASSET POOL MINIMUM. Class 3 shall be paid monthly from time to
time to the extent the Asset Pool contains at least $1000 after
payment of Administrative Claims, Professional Fee Claims, and
Classes 1 and 2.
4.4 CLASS 4(A) (GENERAL UNSECURED CLAIMS). Class 4(a) shall consist of
Allowed General Unsecured Claims not otherwise specifically classified under
this Plan. The Class 4(a) Claims shall be paid their Pro Rata share of the Asset
Pool monthly from time to time to the extent the Asset Pool contains at least
$1,000 after payment in full of or reserve for Administrative Claims,
Professional Fee Claims, and Classes 1, 2 and 3. In the event all Class 4(a)
Claims have been paid or reserved for, Rancher will pay or reserve for from the
Asset Pool, as the case may be, interest on all Class 4(a) Claims calculated
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from the Petition Date to the date of Distributions on the Class 4(a) Claims at
the rate provided under 28 U.S.C. ss. 1961 in effect as of the Effective Date.
4.5 CLASS 4(B) (BLM ALLOWED UNSECURED CLAIM). Class 4(b) shall consist of
the Allowed Claim of the BLM for plugging and reclamation liability and other
claimed amounts. The Class 4(b) Claim shall be satisfied by the remediation and
other well workovers as required by the BLM of Linc. Upon the Effective Date,
Rancher will be released from any liability for the Class 4(b) Claim and the
Operator Bond posted by Rancher for the benefit of the BLM in the current amount
of $25,000.00 shall be released upon Rancher's written request.
4.6 CLASS 4(C) (ALLOWED, LATE-FILED UNSECURED CLAIMS). Class 4(c) shall
consist of the Allowed General Unsecured Claims that were not filed prior to the
Bar Date and were not deemed by the Court as timely filed if filed after the Bar
Date. The Class 4(c) Claims shall be paid their Pro Rata share of the Asset Pool
monthly from time to time to the extent the Asset Pool contains at least $1,000
after payment in full of or reserve for Administrative Claims, Professional Fee
Claims, and Classes 1, 2, 3 and 4(a).
4.7 INTEREST. In the event all Class 4(c) Claims have been paid or reserved
for, Rancher will pay or reserve for from the Asset Pool, as the case may be,
interest on all Class 4 Claims calculated from the Petition Date to the date of
Distributions on the Class 4 Claims at the rate provided under 28 U.S.C. ss.
1961.
4.8 CLASS 5 (SHAREHOLDER INTERESTS) Class 5 shall consist of (a) all common
stock Interests in the Debtor on the Effective Date, and (b) the Allowed Claims
in Class 9 subject to subordination under ss. 510(b) of the Code. The rights of
Allowed Class 5 holders shall remain unimpaired except as specifically provided
under this Plan.
4.9 CLASS 6 (WARRANTS) Class 6 shall consist of (a) all holders of warrants
as shown on the Stock and Transfer records of Rancher as of the Record Date and
(b) the Allowed Claims in Class 9 subject to subordination under ss. 510(b) of
the Code to the extent such Claims arise from the purchase of warrants. All such
warrants shall be cancelled and each Class 6 Claimant shall receive shares of
the Debtor's common stock based on the following formula: one share of common
stock for every 100 shares common stock to which such Claimant would be
otherwise entitled upon exercise of the warrants, regardless of the exercise
price or any other terms of the warrants.
4.10 CLASS 7 (EMPLOYEE STOCK OPTIONS). Class 7 shall consist of Allowed
Claims for stock options vested as of the Record Date as the result of
management retention agreements or employee stock option agreements. Such
options shall remain unimpaired.
4.11 CLASS 8 (CONVERTIBLE NOTE HOLDERS). Class 8 shall consist of Allowed
Claims pursuant to Convertible Promissory Notes dated October 27, 2009. Each
holder of such Notes shall retain the right to convert the Convertible
Promissory Note to shares of common stock pursuant to the terms thereof,
provided that (a) conversion shall be at the conversion price provided in the
Convertible Promissory Note adjusted, and (b) such election is made on within 10
days of the Effective Date. To the extent such holders do not elect to exercise
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their conversion rights, the Allowed Class 8 Claims shall be treated as Class
4(a) Claims.
4.12 CLASS 9 (SHAREHOLDER LITIGATION GROUP). Class 9 consists of the
Allowed Shareholder Litigation Group Claims, which were filed by Frank W.
Cutler; Walfran, Ltd.; FWC Educational Trust aka Frank W. Cutler Educational
Trust dated 12/15/99; James Deccio; Eva Ferencova; Erin Rahn; Ralph Karp; Dewain
Campbell; Merrill McCarthy; L.M., a minor by Merrill McCarthy her guardian ad
litem; and B.M., a minor by Merrill McCarthy her guardian ad litem. The Class 9
Claims have been subordinated under ss. 510(b) of the Bankruptcy Code and
therefore will be treated as Class 5 Interests in the amount of the common stock
which the holders of the Class 9 Claims hold according to the Stock and Transfer
Records of Rancher as of the Record Date. Warrants held by the Shareholder
Litigation Group will be treated similarly under Class 6. Nothing in this Plan
shall affect the rights of the Shareholder Litigation Group to pursue any
actions it may have against any insurance that may insure Rancher or its
officers and directors against the Shareholder Litigation Group Claims.
ARTICLE 5
MEANS OF IMPLEMENTATION OF THIS PLAN
5.1. VESTING OF ASSETS. On the Effective Date, all property of the Debtor's
Estate shall vest in the Debtor, free and clear of all claims and interests
except as specifically set forth in this Plan.
5.2 OBLIGATION OF THE BOARD, Rancher and its Board shall be restricted to
liquidating Rancher's assets and making Distributions on Allowed Claims (or
reserving funds for Disputed Claims) until all Allowed Claims are satisfied in
full and funds are deposited in the Disputed Claims Reserve sufficient to pay
all Disputed Claims, or Rancher's assets are fully depleted and its affairs
wound up, whichever occurs first.
If after all Allowed Claims are satisfied in full and funds are deposited
in the Disputed Claims Reserve sufficient to pay all Disputed Claims, if any,
and Rancher has more than $1,500,000.00 in cash and other assets (or some lesser
amount as determined by the Board and approved by Rancher's shareholders),
including the receivable due from the existing contract with Merit Energy, then
the Board may determine that it is in the best interest of its shareholders to
continue Rancher's operations as a public company. In such event, Rancher would
continue to operate in the oil and gas business. The focus of Rancher's
activities would be to purchase non-operating interests in producing oil and gas
properties in the Rocky Mountain area, with the decision to purchase such
interests depending on the economics of each prospect. In addition to the
foregoing, Rancher may seek strategic transactions with other existing public
and private companies in the oil and gas business.
If the Board determines not to continue Rancher's operations, then the
Board may wind up Rancher's affairs in accordance with applicable law. Until
such time as a shareholder election occurs, Rancher will do all that is
reasonably necessary to maintain its publicly traded status.
5.3 STOCK INCENTIVE PLAN TERMINATION. The Debtor's 2006 Stock Incentive
Plan will be deemed terminated as of the Effective Date.
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5.4 PRESERVATION OF CAUSES OF ACTION. Unless expressly waived or
relinquished, released, compromised or settled in this Plan, or in any contract,
instrument, release or other agreement entered into or delivered in connection
with this Plan: (a) the Debtor shall exclusively retain and may prosecute and
enforce, and the Debtor expressly reserves and preserves for these purposes in
accordance with ss.ss. 1123(a)(5)(B) and 1123(b)(3) of the Bankruptcy Code, any
Claims, demands, rights and Causes of Action that its Estate may hold or have
held prior to Confirmation against any Person; and (b) no preclusion doctrine,
including, without limitation, the doctrines of res judicata, collateral
estoppel, issue preclusion, claim preclusion, estoppel (judicial, equitable or
otherwise), claim splitting or laches shall apply to such Claims and Causes of
Action by virtue of or in connection with Confirmation, consummation or
effectiveness of this Plan.
5.5 SINGLE CLAIM RULE. With respect to each Class of Claims, a Claimant
shall be deemed to hold only a single claim in such Class, regardless of how
many separate Claims the Debtor has scheduled or the Claimant has filed. If any
Claim or any portion of the Claim in a particular Class is disputed, no
distribution shall be made with respect to such Claim until all or a portion of
the Claim is Allowed and the remainder, if any, is determined to be not Allowed
by Final Order.
5.6 DEADLINE FOR FILING PROFESSIONAL FEE APPLICATIONS. All parties seeking
payment of Professional Fee Claims arising prior to the Effective Date must file
with the Bankruptcy Court and serve upon the Debtor, a final application on or
before the first Business Day which is the sixtieth (60th) day after the
Effective Date. Failure to timely file and serve such application shall act as a
bar against the assertion of any such right to payment. The Debtor shall mail
Notice of the Effective Date and the foregoing deadline not later than ten (10)
calendar days after the Effective Date.
5.7 EXECUTION OF DOCUMENTS TO EFFECTUATE PLAN. Prior to the Effective Date,
the Debtor shall execute any instruments or documents that are necessary to
effectuate the provisions of this Plan. Claimants with Secured Claims and all
other necessary parties shall execute or deliver, or join in the execution and
delivery, of any instrument required to effect a transfer of property under this
Plan, and shall perform any other act, including the satisfaction, release or
assignment of any lien that is reasonable or necessary for the consummation of
this Plan. From and after the Effective Date, the Debtor shall have the
exclusive power and authority to execute any instrument or document to
effectuate the provisions of this Plan. The Debtor may require surrender of the
original warrants or options in exchange for the stock to be issued hereunder or
implement such other reasonable procedures with respect to the issuance of new
stock as contemplated under this Plan. The Debtor, through its Board shall have
the authority to amend the Debtor's Articles, By-Laws or other corporate
documents as may be necessary to implement this Plan, including but not limited
to increasing or decreasing the number of Directors, converting the Debtor to a
private company, or winding up and dissolving the Debtor once the Asset Pool has
been exhausted, provided that no such amendment shall contravene the provisions
of this Plan.
5.8 DISALLOWANCE OF CLAIMS WITHOUT FURTHER ORDER OF THE COURT. As of the
Confirmation Date, any Scheduled Claim designated as disputed, contingent,
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unknown in amount or unliquidated in amount, and for which the Claimant has not
filed a proof of Claim, shall be deemed expunged, without further act or deed.
All Scheduled Claims that correspond to a proof of Claim filed by a particular
Claimant shall be deemed to have been superseded by such later filed proof of
Claim.
5.9 POST-CONFIRMATION REPORTS AND FEES. The Debtor shall be responsible for
the filing of all post-Confirmation reports with the U.S. Trustee and payment of
all post-Confirmation fees charged or assessed under 28 U.S.C. ss. 1930 until
the Debtor's Chapter 11 case is closed. Any outstanding quarterly fees pursuant
to 28 U.S.C. ss. 1930(a)(6) payable as of the Effective Date shall be paid in
full on or before the Effective Date.
5.10 ASSET POOL TERMINATION. The Asset Pool shall terminate upon the
earlier of (1) the payment in full of Classes 1 through 4 or (2) the exhaustion
of the Debtor's assets below the amounts necessary to wind up and dissolve the
Debtor.
ARTICLE 6
TREATMENT OF EXECUTORY CONTRACTS & UNEXPIRED LEASES
6.1. EXECUTORY CONTRACTS AND LEASES. All executory contracts and unexpired
leases of the Debtor are hereby deemed rejected as of the Effective Date, unless
a particular executory contract or unexpired lease (i) has previously been
assumed or rejected pursuant to order of the Bankruptcy Court or applicable
provisions of the Bankruptcy Code, (ii) is the subject of a pending motion to
assume or reject such contract or lease filed by the Debtor, or (iii) is
otherwise specifically addressed in this Plan. The amount necessary to cure any
default proposed under this Plan shall be determined in accordance with the
underlying agreement and applicable nonbankruptcy law.
6.2 DELETED.
6.3 DELETED.
6.4 REJECTION CLAIM BAR DATE. No more than ten (10) Business Days following
the Confirmation Date, the Debtor shall provide notice to all known parties to
any executory contract or unexpired lease deemed rejected under this Article and
not previously rejected of their right to file proofs of Claim relating thereto.
Any party to an executory contract or unexpired lease that is rejected in
accordance with Section 6.1 shall file a proof of Claim for damages resulting
from such rejection not later than thirty (30) days after the date of such
notice was mailed. The failure to timely file a proof of Claim shall be deemed a
waiver of any claim in connection with the rejection of such contract or lease.
ARTICLE 7
CONDITIONS PRECEDENT; CONFIRMATION & EFFECTIVE DATE
7.1. CONDITIONS PRECEDENT TO CONFIRMATION OF THIS PLAN. Unless this
condition is waived in accordance with Section 7.3, the Confirmation Order
shall, among other things:
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A. Authorize the implementation of this Plan in accordance with its
terms.
B. Provide that any transfers effected or mortgages or other
security documents entered into or to be effected or entered into
under this Plan shall be and are exempt from any state, city, or
other municipality transfer taxes, mortgage recording taxes, and
any other stamp or similar taxes pursuant to ss. 1146(c) of the
Bankruptcy Code.
C. Approve in all respects the other settlements, transactions, and
agreements to be effected pursuant to this Plan.
7.2. CONDITIONS PRECEDENT TO THE EFFECTIVE DATE. The Effective Date shall
not occur and no obligations and rights set forth in this Plan and set to occur
as of the Effective Date or thereafter shall come into existence, unless each of
the following conditions is met or, alternatively, is waived in accordance with
Section 7.3 hereof on or before the Effective Date:
A. The Confirmation Order shall have been entered and become a Final
Order.
7.3. WAIVER OF CONDITIONS PRECEDENT. Each of the conditions precedent in
Sections 7.1 and 7.2 hereof may be waived or modified, in whole or in part, but
only by the Debtor. Any such waiver or modification of a condition precedent in
Sections 7.1 or 7.2 hereof may be effected at any time upon filing a notice
thereof with the Bankruptcy Court, without leave or order of the Bankruptcy
Court and without any other formal action.
ARTICLE 8
EXCULPATION
The Debtor shall neither have nor incur any liability to any Person for any
act taken or omitted to be taken in connection with or related to the
formulation, preparation, dissemination, implementation, administration,
confirmation or consummation of this Plan, the Disclosure Statement or any
contract, instrument, release or other agreement or document created or entered
into in connection with this Plan, or any act taken or omitted to be taken
during the Bankruptcy Case, except for acts or omissions as a result of willful
misconduct or gross negligence.
ARTICLE 9
PROVISIONS GOVERNING DISTRIBUTIONS
9.1. DISTRIBUTIONS ONLY ON BUSINESS DAYS. Notwithstanding the foregoing
provisions, if any Distribution called for under this Plan is due on a day other
than a Business Day, such Distribution shall instead be due on the next Business
Day.
9.2. UNCLAIMED DISTRIBUTIONS. Any Distributions (i) by checks which have
been returned as undeliverable without a proper forwarding address and the
Claimant fails to notify the Debtor in writing within 90 days of a proper
address, and (ii) by checks which have not been negotiated within 90 days of
issuance and the Claimant has not notified the Debtor in writing to stop payment
and reissue the check, shall be deemed forfeited and the Claimant with such
Claim shall be removed from the Distribution schedules and shall receive no
further Distributions under this Plan. Any such Distributions shall become
property of the Debtor.
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9.3. DISPUTED DISTRIBUTION. If any dispute arises as to the identity of a
Claimant with an Allowed Claim who is to receive any distribution, the Debtor
may, in lieu of making such distribution to such Claimant, make such
distribution into a segregated account until the disposition shall be determined
by Final Order of the Bankruptcy Court or by written agreement among the
interested parties to such dispute.
9.4. TRANSMITTAL OF PAYMENTS AND NOTICES. All Distributions shall be made
to a Claimant by regular first-class mail, postage prepaid, in an envelope
addressed to such Claimant at the address listed on its proof of Claim filed
with the Bankruptcy Court or, if no proof of Claim was filed, (i) at the address
listed by the Debtor on the Schedules, (ii) as the Claimant may direct in
writing, or (iii) otherwise at such Claimant's last known address. Debtor shall
take reasonable steps to ascertain the most current address of the Claimant
whose distribution check is returned as undeliverable prior to treating such
check as an Unclaimed Distribution. The date of payment or delivery shall be the
date of mailing. Distributions made in accordance with the aforementioned
provisions of this Section will be deemed made to the Claimant regardless of
whether such Claimant actually receives the Distribution.
9.5. RECORD DATE FOR DISTRIBUTIONS. A transferee of a Claim will be treated
as the holder of the Claim for purposes of Distributions and otherwise, provided
written notice of the transfer signed by the original Claimant is delivered to
the Debtor and compliance with Bankruptcy Rule 3001, if applicable, is
completed, at least ten (10) days prior to the next proposed Distribution.
Absent such notice, in making any Distribution, the Debtor shall be entitled to
recognize and deal for all purposes hereunder only with the Person who is listed
on the proof of Claim filed with respect thereto or on the Debtor's Schedules as
the holder thereof as of the close of business on the Confirmation Date and upon
such other evidence or record of transfer or assignment known by such Persons as
of the Confirmation Date. No amendments to Claims shall be permitted after the
Effective Date.
9.6. DISPUTED CLAIMS RESERVE. Except to the extent the Court determines
that a lesser amount is adequate, the Debtor shall, with each Distribution,
deposit into one or more separate interest-bearing Disputed Claims Reserve
accounts established by the Debtor, Cash equal to the Distributions that would
have been made to Claimants with Disputed Claims if such Claims were Allowed
Claims in their full amounts, except for any Disputed Class 9 Claims. When a
Disputed Claim becomes an Allowed Claim, the Debtor shall distribute to the
Claimant with such Allowed Claim, as soon as practicable and in accordance with
the provisions of this Plan (but in no event later than the next succeeding
Distribution Date), Cash in the amount of all Distributions to which such
Claimant would be entitled to if such Claimant's Claim were Allowed on the
Effective Date. In no event shall the Debtor be responsible or liable for any
loss to or of any amount reserved under this Plan unless such loss is the result
of the Debtor's fraud or willful misconduct.
9.7. NO DE MINIMIS DISTRIBUTIONS. The Debtor shall not be required to make
any distribution with regard to any Claim if the amount of the Distribution to
that Claimant would be less than $10.00.
9.8. SETOFF AND RECOUPMENT. Except as otherwise provided in this Plan, the
Debtor may, but shall not be required to, set off against, or recoup from, any
Claimant and the Distributions to be made pursuant to this Plan in respect
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thereof, any Claims, defenses or Causes of Action of any nature whatsoever that
the Debtor may have, but neither the failure to do so nor the allowance of any
Claim shall constitute a waiver or release by the Debtor of any right of setoff
or recoupment against a Claimant.
9.9. PAYMENT OF TAXES ON DISTRIBUTIONS RECEIVED PURSUANT TO THIS PLAN. All
Entities that receive Distributions under this Plan shall be responsible for
reporting and paying, as applicable, taxes on account of their Distributions.
9.10. COMPLIANCE WITH TAX WITHHOLDING AND REPORTING REQUIREMENTS. With
respect to all Interests issued and Distributions made under this Plan, the
Debtor will comply with all withholding and reporting requirements of any
federal, state, local or foreign taxing authority.
ARTICLE 10
PLAN INTERPRETATION, CONFIRMATION AND VOTING
10.1. WITHDRAWAL AND MODIFICATION OF PLAN. The Debtor may withdraw or
modify this Plan at any time prior to the Confirmation Date. The Debtor may
modify this Plan in any manner consistent with ss. 1127 of the Bankruptcy Code
prior to substantial consummation thereof. Upon request by the Debtor, this Plan
may be modified after substantial consummation with the approval of the
Bankruptcy Court, provided that such modification does not affect the essential
economic treatment of any Person that objects in writing to such modification.
10.2. GOVERNING LAW. Unless a rule of law or procedure is supplied by
federal law (including the Bankruptcy Code and the Bankruptcy Rules) with
respect to matters of corporate governance, the laws of the State of Colorado
applicable to contracts executed in such State by residents thereof and to be
performed entirely within such State will govern the construction and
implementation of this Plan and any agreements, documents and instruments
executed in connection with this Plan.
10.3. CRAM DOWN. The Debtor requests that, in the event that any impaired
Class entitled to vote on this Plan does not accept this Plan, the Bankruptcy
Court confirm this Plan in accordance with the provisions of ss. 1129(b) of the
Bankruptcy Code.
ARTICLE 11
RETENTION OF JURISDICTION BY BANKRUPTCY COURT
11.1. From the Confirmation Date until entry of a final decree closing the
Debtor's Bankruptcy Case (pursuant to 11 U.S.C. ss. 350 and Bankruptcy Rule
3022), the Bankruptcy Court shall retain such jurisdiction as is legally
permissible over the Bankruptcy Case for the following purposes:
A. to hear and determine any and all objections to the allowance of
any Claim or Administrative Claim, or any controversy as to the
classification of Claims or any matters which may directly,
indirectly or contingently affect the obligations of the Debtor
to any Claimants, or other parties in interest;
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B. to hear and determine any and all applications for compensation
and reimbursement of expenses by professionals retained pursuant
toss.327 of the Bankruptcy Code;
C. to hear and determine any and all pending motions for the
assumption or rejection of executory contracts and unexpired
leases, and to Allow or disallow any Claims resulting therefrom;
D. to adjudicate such contested matters and adversary proceedings as
may be pending or subsequently initiated in the Bankruptcy Court,
except to the extent the Bankruptcy Court may not enter a final
order under Article 1 of the United States Constitution;
E. to enforce and interpret the provisions of this Plan and the
Confirmation Order;
F. to issue any injunction or other relief appropriate to implement
the intent of this Plan, and to enter such further orders
enforcing any injunctions or other relief issued under this Plan
or pursuant to the Confirmation Order;
G. to modify this Plan pursuant toss.1127 of the Bankruptcy Code and
the applicable Bankruptcy Rules;
H. to correct any defect, cure any omission, or reconcile any
inconsistency in this Plan or in the Confirmation Order as may be
necessary to carry out the purpose and the intent of this Plan;
I. to interpret and determine such other matters as the Confirmation
Order may provide for, or as may be authorized under the
Bankruptcy Code; and
J. to enter and implement such orders as may be appropriate in the
event the Confirmation Order is, for any reason, stayed,
reversed, revoked, modified or vacated.
Dated: July 16, 2012. DEBTOR AND DEBTOR IN POSSESSION,
RANCHER ENERGY CORP.,
By: /S/ JON NICOLAYSEN
Its: CEO & President
ONSAGER, STAELIN & GUYERSON, LLC
/s/Christian C. Onsager
--------------------------
Christian C. Onsager, #6889
Michael J. Guyerson, #11279
Andrew. D. Johnson, #36879
1873 S. Bellaire St., Suite 1401
Denver, Colorado 80222
Ph: (303) 512-1123
Fax: (303) 512-1129
consager@osglaw.com
mguyerson@osglaw.com
ajohnson@osglaw.com
Counsel for Rancher Energy Corp.
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