AMENDED AND RESTATED JOINT LIQUIDATING PLAN

Exhibit 2.1

 

UNITED STATES BANKRUPTCY COURT

EASTERN DISTRICT OF VIRGINIA

Richmond Division

 

 

AMENDED AND RESTATED JOINT LIQUIDATING PLAN OF REORGANIZATION

PROPOSED BY HEILIG-MEYERS COMPANY, HEILIG-MEYERS FURNITURE COMPANY, HEILIG-MEYERS FURNITURE COMPANY WEST, INC., HMY STAR, INC., AND MACSAVER FINANCIAL SERVICES, INC. AND

THE OFFICIAL COMMITTEE OF UNSECURED CREDITORS

 

Dated: March 7, 2005

 

 

TABLE OF CONTENTS

 

 

 

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INTRODUCTION

 

Heilig-Meyers Company, Heilig-Meyers Furniture Company, Heilig-Meyers Furniture Company West, Inc., HMY Star, Inc., and MacSaver Financial Services, Inc. (collectively, the “ Debtors ”) and the Official Committee of Unsecured Creditors (the “ Creditors’ Committee ”) jointly propose this amended and restated joint liquidating plan of reorganization pursuant to the provisions of chapter 11 of the Bankruptcy Code. Capitalized terms used in this Introduction and the remainder of this Plan have the meanings ascribed to them in Article I of this Plan.

 

Reference is made to the Disclosure Statement (as that term is defined herein) for a discussion of the Debtors’ history, businesses, properties and operations, a summary and analysis of this Plan, and certain related matters. Subject to certain restrictions and requirements set forth in section 1127 of the Bankruptcy Code, Bankruptcy Rule 3019 and this Plan, the Debtors and the Creditors’ Committee reserve the right to alter, amend, modify, revoke or withdraw this Plan prior to its substantial consummation.

 

ALL CLAIMHOLDERS ENTITLED TO VOTE ON THIS PLAN ARE ENCOURAGED TO CAREFULLY READ THE DISCLOSURE STATEMENT AND THIS PLAN BEFORE VOTING TO ACCEPT OR REJECT THIS PLAN. NO SOLICITATION MATERIALS, OTHER THAN THE DISCLOSURE STATEMENT AND RELATED MATERIALS TRANSMITTED HEREWITH AND APPROVED BY THE BANKRUPTCY COURT, HAVE BEEN AUTHORIZED BY THE BANKRUPTCY COURT FOR USE IN SOLICITING ACCEPTANCE OR REJECTION OF THIS PLAN.

 

ARTICLE I

 

DEFINITIONS, RULES OF INTERPRETATION,

AND COMPUTATION OF TIME

 

A.	Scope of Definitions

 

For purposes of this Plan, except as expressly provided or unless the context otherwise requires, all capitalized terms not otherwise defined shall have the meanings ascribed to them in this Article I of this Plan. Any term used in this Plan that is not defined herein, but is defined in the Bankruptcy Code or the Bankruptcy Rules, shall have the meaning ascribed to that term in the Bankruptcy Code or the Bankruptcy Rules. Whenever it appears appropriate from the context, each term stated in the singular or the plural includes the singular and the plural, and each pronoun stated in the masculine, feminine or neuter includes the masculine, feminine and neuter.

 

B.	Definitions

 

1.1 “503 Deadline” shall have the meaning ascribed to it in Article 9.2 hereof.

 

1.2 “7.40% Notes” means the 7.40% Notes due February 15, 2002 in the aggregate principal amount of $100 million, issued by MacSaver pursuant to the 7.40% Notes Indenture and guaranteed by Heilig-Meyers.

 

1.3 “7.40% Notes Indenture” means that certain indenture dated as of August 1, 1996, as amended, supplemented or otherwise modified prior to the Petition Date, by and between MacSaver and First Union National Bank, f/k/a First Union National Bank of Virginia, as indenture trustee, pursuant to which MacSaver issued and Heilig-Meyers guaranteed the 7.40% Notes.

 

1.4 “7.60% Notes” means the 7.60% Notes due August 1, 2007 in the aggregate principal amount of $175 million, issued by MacSaver pursuant to the 7.60% Notes Indenture and guaranteed by Heilig-Meyers.

 

1.5 “7.60% Notes Indenture” means that certain indenture dated as of August 1, 1996, as amended, supplemented or otherwise modified prior to the Petition Date, by and between MacSaver and First Union National Bank, f/k/a First Union National Bank of Virginia, as indenture trustee, pursuant to which MacSaver issued and Heilig-Meyers guaranteed the 7.60% Notes.

 

1.6 “7.88% Notes” means the 7.88% Notes due August 1, 2003 in the aggregate principal amount of $200 million, issued by MacSaver pursuant to the 7.88% Notes Indenture and guaranteed by Heilig-Meyers.

 

1.7 “7.88% Notes Indenture” means that certain indenture dated as of August 1, 1996, as amended, supplemented or otherwise modified prior to the Petition Date, by and between MacSaver and First Union National Bank, f/k/a First Union National Bank of Virginia, as indenture trustee, pursuant to which MacSaver issued and Heilig-Meyers guaranteed the 7.88% Notes.

 

1.8 “Administrative Claim” means any Claim constituting a cost or expense of administration of the Chapter 11 Cases allowed under sections 503(b) and 507(a)(1) of the Bankruptcy Code including, but not limited to, any actual and necessary costs and expenses of preserving the Debtors’ estates, any actual and necessary costs and expenses of operating the Debtors’ businesses, any indebtedness or obligations incurred or assumed by the Debtors, as Debtors in Possession, during the Chapter 11 Cases (other than the DIP Lender Claims), including, without limitation, for the acquisition or lease of property or an interest in property or the rendition of services, any allowances of compensation and reimbursement of expenses to the extent allowed by Final Order under section 330 or 503 of the Bankruptcy Code, and any fees or charges assessed against the Debtors’ estate under section 1930 of chapter 123 of title 28 of the United States Code.

 

1.9 “Administrative Claims Reserve” means the reserve to be established and maintained by the Liquidation Trustee pursuant to the terms hereof containing all distributions that may be made on grounds of any Disputed Administrative Claims pending entry of a Final Order allowing or disallowing such Disputed Administrative Claims.

 

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1.10 “Affiliated Debtor Shares” means the number of shares of New RoomStore Common Stock, if any, to be distributed to Heilig-Meyers in respect of the Affiliated Debtor Unsecured Claim in connection with the RoomStore Chapter 11 Case.

 

1.11 “Affiliated Debtor Unsecured Claim” means a general unsecured claim in favor of Heilig-Meyers against RoomStore in the allowed amount of $57,900,000.

 

1.12 “Affiliates” shall have the meaning ascribed to such term by section 101(2) of the Bankruptcy Code.

 

1.13 “Allowed Claim” means, with respect to a Claim or any portion thereof, a Claim (a) that has been allowed by a Final Order of the Bankruptcy Court (or such other court as the Liquidation Trustee and the holder of such Claim agrees may adjudicate such Claim and objections thereto), (b) as to which, on or by the Effective Date, (i) no proof of claim has been filed with the Bankruptcy Court and (ii) the liquidated and noncontingent amount of which is Scheduled, other than a Claim that is Scheduled at zero, in an unknown amount, or as disputed, (c) for which a proof of claim in a liquidated amount has been timely filed with the Bankruptcy Court pursuant to the Bankruptcy Code, any Final Order of the Bankruptcy Court or other applicable bankruptcy law, and as to which either (i) no objection to its allowance has been filed within the periods of limitation fixed by this Plan, the Bankruptcy Code or by any order of the Bankruptcy Court or (ii) any objection to its allowance has been settled or withdrawn, or has been denied by a Final Order, or (d) that is expressly allowed in a liquidated amount in this Plan.

 

1.14 “Available Cash” means all Cash held by the Liquidation Trustee after paying (or reserving or otherwise providing for the payment of ): (a) all Administrative Claims, Priority Tax Claims, Other Priority Claims and Other Secured Claims; and (b) all liabilities, costs and expenses of the Liquidation Trust, including without limitation, the liabilities, costs and expenses incurred (or that are reasonably likely to be incurred) by the Liquidation Trustee and the members of the Liquidation Trust Committee in the performance of their respective duties under the Trust Agreement, in such amounts as the Liquidation Trustee shall determine, in his sole discretion, to be appropriate.

 

1.15 “Ballot” means each of the ballot forms that are distributed to holders of Claims who are included in Classes that are entitled to vote to accept or reject this Plan.

 

1.16 “Bankruptcy Code” means the Bankruptcy Reform Act of 1978, as amended and codified in Title 11 of the United States Code, 11 U.S.C. §§ 101-1330, as in effect on the date hereof.

 

1.17 “Bankruptcy Court” means the United States Bankruptcy Court for the Eastern District of Virginia.

 

1.18 “Bankruptcy Rules” means the Federal Rules of Bankruptcy Procedure and the Official Bankruptcy Forms, as amended, the Federal Rules of Civil Procedure, as amended, as applicable to the Chapter 11 Cases or proceedings therein, and the Local Rules of the Bankruptcy Court, as applicable to the Chapter 11 Cases or proceedings therein, as the case may be.

 

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1.19 “Bar Date” means the deadline for filing all proofs of claim or interest established by the Bankruptcy Court as July 16, 2001, including Claims of governmental units in accordance with section 502(b)(9) of the Bankruptcy Code, except Administrative Claims.

 

1.20 “Bar Date Order” means that order entered by the Bankruptcy Court on May 30, 2001, which, among other things, established the Bar Date.

 

1.21 “Beneficiaries” means the holders of Allowed Claims, irrespective of whether such Claims are Allowed on or after the Effective Date.

 

1.22 “Bondholder Secured Claims” means a Claim asserted by the Indenture Trustee arising from Section 1008 of the Indenture.

 

1.23 “Business Day” means any day, excluding Saturdays, Sundays and legal holidays, on which commercial banks are open for business in New York City.

 

1.24 “Cash” means legal tender of the United States.

 

1.25 “Certificate” shall have the meaning ascribed to it in Article 8.6 hereof.

 

1.26 “Chapter 11 Case(s)” means the chapter 11 cases of the Debtors pending in the Bankruptcy Court.

 

1.27 “CIT” means the CIT Group/Business Credit, Inc.

 

1.28 “CIT Letter Agreement” means that certain agreement, dated                  , 2005, by and among the Debtor and the DIP Agent, on behalf of the DIP Lenders, as described in the Plan Supplement

 

1.29 “Claim” means a claim against the Debtors (or any of them), whether or not asserted, as defined in section 101(5) of the Bankruptcy Code.

 

1.30 “Claimholder” means a holder of a Claim.

 

1.31 “Claims Agent” means Bankruptcy Services, LLC, the Claims, Noticing and Balloting Agent to the Debtors as approved by Bankruptcy Court on August 16, 2000.

 

1.32 “Claims Objection Deadline” means that day which is one hundred eighty (180) days after the Effective Date, as the same may be from time to time extended by the Bankruptcy Court, without further notice to parties in interest.

 

1.33 “Class” means a category of Claimholders or Interestholders described in Article III of this Plan.

 

1.34 “Class 5(a) Trust Interest Allocation” means 59,200,000 Trust Interests minus (x) Class 5(b) Reallocation Amount, plus (y) Class 5(b) Litigation Recovery Reallocation.

 

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1.35 “Class 5(a) Trust Interests” means the Trust Interests as provided by the Class 5(a) Trust Interest Allocation (as may be reallocated from time to time pursuant to this Plan) to be deemed distributed ratably to holders of Allowed Funded Debt Unsecured Claims pursuant to the terms and conditions of Article 4.7 of this Plan.

 

1.36 “Class 5(b) Litigation Recovery Reallocation” means the product derived from the following formula: (B / 128,500,000) * 4,000,000, where “B” is equal to (x) the sum of the Allowed Class 2(a) Claim, Allowed Class 2(b) Claim, and Allowed Class 2(c) Claim minus (y) 32,500,000.

 

1.37 “Class 5(b) Reallocation Amount” means zero if Allowed Class 5(b) Claims are less than $500 million. If Allowed Class 5(b) Claims are more than $500 million, then the Class 5(b) Reallocation Amount means the product derived from the following formula: [(A-500,000,000)/25,000,000] * 1,000,000, where “A” is equal to the aggregate amount of Allowed Class 5(b) Claims.

 

1.38 “Class 5(b) Trust Interest Allocation” means 100,000,000 Trust Interests minus the Class 5(a) Trust Interest Allocation.

 

1.39 “Class 5(b) Trust Interests” means the Trust Interests as provided by the Class 5(b) Trust Interest Allocation (as may be reallocated from time to time pursuant to this Plan) to be deemed distributed ratably to holders of Allowed Heilig Unsecured Claims pursuant to the terms and conditions of Article 4.8 of this Plan.

 

1.40 “Confirmation Date” means the date of entry of the Confirmation Order.

 

1.41 “Confirmation Hearing” means the hearing before the Bankruptcy Court on confirmation of this Plan and related matters under section 1128 of the Bankruptcy Code.

 

1.42 “Confirmation Order” means the order entered by the Bankruptcy Court confirming this Plan.

 

1.43 “Creditors’ Committee” means the Official Committee of Unsecured Creditors appointed pursuant to section 1102(a) of the Bankruptcy Code in the Chapter 11 Cases.

 

1.44 “Cure” means the distribution of Cash, or such other property as may be agreed upon by the parties or ordered by the Bankruptcy Court, with respect to the assumption of an executory contract or unexpired lease, pursuant to section 365(a) of the Bankruptcy Code, in an amount equal to all unpaid monetary obligations, without interest, or such other amount as may be agreed upon by the parties, under such executory contract or unexpired lease, to the extent such obligations are enforceable under the Bankruptcy Code and applicable non-bankruptcy law.

 

1.45 “Cure Claim” shall have the meaning ascribed to it in Article 7.2 hereof.

 

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1.46 “Cure Claim Submission Deadline” shall have the meaning ascribed to it in Article 7.2 hereof.

 

1.47 “Cure Claim Objection Deadline” shall have the meaning ascribed to it in Article 7.2 hereof.

 

1.48 “Debtor Subsidiaries” means, collectively, Heilig-Meyers Furniture Company, Heilig-Meyers Furniture West, Inc., HMY Star, Inc., and MacSaver Financial Services, Inc., each of which is a direct or indirect subsidiary of Heilig-Meyers and is a Debtor and Debtor-in-Possession in the Chapter 11 Cases.

 

1.49 “Debtors” means, collectively, Heilig-Meyers and the Debtor Subsidiaries.

 

1.50 “Debtors in Possession” means the Debtors in their capacity as debtors in possession in the Chapter 11 Cases under sections 1107(a) and 1108 of the Bankruptcy Code.

 

1.51 “DIP Agent” means CIT in its capacity as agent for the DIP Lenders under the DIP Credit Agreement.

 

1.52 “DIP Credit Agreement” means that certain $30,000,000 Senior Secured Superpriority Debtor-in-Possession Loan and Security Agreement, dated as of July 31, 2001, among the Debtors and RoomStore, as Borrowers, the financial institutions party thereto, and the DIP Agent (as amended, restated, supplemented and modified from time to time).

 

1.53 “DIP Lenders” means, collectively, those financial institutions from time to time party to the DIP Credit Agreement.

 

1.54 “DIP Lender Claims” means superpriority administrative Claims of the DIP Lenders under the DIP Credit Agreement or the Final DIP Order, including, to the fullest extent, all Claims arising from or related to the Secured Obligations (as defined in the DIP Credit Agreement), subject to the right of the Debtors, the Liquidation Trust or Creditors’ Committee to dispute the amount of any Claims made by the DIP Lenders.

 

1.55 “Disallowed” means a Claim or any portion thereof, that (a) has been disallowed by a Final Order, (b) is Scheduled at zero or as contingent, disputed or unliquidated and as to which a proof of claim bar date has been established but no proof of claim has been timely filed or deemed timely filed with the Bankruptcy Court pursuant to either the Bankruptcy Code or any Final Order of the Bankruptcy Court or otherwise deemed timely filed under applicable law, or (c) is not Scheduled and as to which a proof of claim bar date has been set but no proof of claim has been timely filed or deemed timely filed with the Bankruptcy Court pursuant to either the Bankruptcy Code or any Final Order of the Bankruptcy Court or otherwise deemed timely filed under applicable law.

 

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1.56 “Disclosure Statement” means the written disclosure statement that relates to this Plan, as approved by the Bankruptcy Court pursuant to section 1125 of the Bankruptcy Code and Bankruptcy Rule 3017, as such disclosure statement may be amended, modified or supplemented from time to time.

 

1.57 “Disputed Administrative Claim” means an Administrative Claim that is a Disputed Claim.

 

1.58 “Disputed Claim” means a Claim or any portion thereof, that is neither an Allowed Claim nor a Disallowed Claim and includes, without limitation, Claims that (a) (i) have not been Scheduled by the Debtors or have been Scheduled at zero, as unknown or as contingent, unliquidated or disputed and (ii) are not the subject of an objection in the Bankruptcy Court, (b) are the subject of a proof of claim that differs in nature, amount or priority from the Schedules, or (c) are the subject of an objection with the Bankruptcy Court and which objection has not been withdrawn, settled or overruled by a Final Order of the Bankruptcy Court.

 

1.59 “Disputed Funded Debt Unsecured Claim” means a Funded Debt Unsecured Claim that is a Disputed Claim.

 

1.60 “Disputed Heilig Unsecured Claim” means a Heilig Unsecured Claim that is a Disputed Claim.

 

1.61 “Disputed Other Priority Claim” means an Other Priority Claim that is a Disputed Claim.

 

1.62 “Disputed Other Secured Claim” means an Other Secured Claim that is a Disputed Claim.

 

1.63 “Distributions” means the distributions of Cash, shares of New RoomStore Common Stock and other property, if any, held in the Liquidation Trust to be made in accordance with this Plan and/or the Trust Agreement.

 

1.64 “Effective Date” means the Business Day on which all conditions to the consummation of this Plan set forth in Article 11.2 hereof have been either satisfied or waived as provided in Article 11.3 hereof and is the day upon which this Plan is substantially consummated.

 

1.65 “Entity” means as defined in section 101(15) of the Bankruptcy Code.

 

1.66 “Estates” means the bankruptcy estates of the Debtors created pursuant to section 541 of the Bankruptcy Code.

 

1.67 “Estate Action” means any and all actions, proceedings, causes of action, suits, accounts, controversies, agreements, promises, rights to legal remedies, rights to equitable remedies, rights to payment and claims that may be asserted by any Debtor’s Chapter 11 estate, whether known, unknown, reduced to judgment, not reduced to judgment, liquidated, unliquidated, fixed, contingent, matured, unmatured, disputed,

 

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undisputed, secured or unsecured and whether asserted or assertable directly or derivatively, in law, equity or otherwise, including, without limitation, actions against Persons arising under sections 502, 510, 541, 542, 543, 544, 547 through 551 and 553 of the Bankruptcy Code, or under related state or federal statutes and common law, including fraudulent transfer laws, whether or not litigation is commenced to prosecute such actions.

 

1.68 “Exhibit” means an exhibit annexed to either this Plan or the Disclosure Statement.

 

1.69 “Existing Securities” means, collectively, the Unsecured Notes, the Prudential Notes, the Old Common Stock, and all options, warrants and rights (whether fixed or contingent, matured or unmatured, disputed or undisputed), contractual, legal, equitable or otherwise, to acquire any of the foregoing.

 

1.70 “Final DIP Order” means that certain Final Order Authorizing Debtors-in-Possession to Borrow Funds With Priority Over Administrative Expense and Secured by Superpriority Liens on Property of the Estates, entered on July 26, 2001.

 

1.71 “Final Order” means an order or judgment, the operation or effect of which has not been stayed, reversed or amended and as to which order or judgment (or any revision, modification or amendment thereof) the time to appeal or seek review or rehearing has expired and as to which no appeal or petition for review or rehearing was filed or, if filed, remains pending.

 

1.72 “Funded Debt Unsecured Claim” means any Unsecured Claim for principal or interest arising from the Synthetic Leases, Wachovia Credit Agreement, Prudential Notes Agreement, and/or Indentures.

 

1.73 “Funded Debt Unsecured Claims Reserve” means the reserve established and maintained by the Liquidation Trustee pursuant to the terms hereof containing all Distributions that may be made on account of any Disputed Funded Debt Unsecured Claims to be reserved pending the entry of a Final Order allowing or disallowing such Disputed Funded Debt Unsecured Claims.

 

1.74 “Furniture Company” means Heilig-Meyers Furniture Company, a North Carolina corporation, and a Debtor in Possession in the above-captioned Chapter 11 Case No. 00-34534-DOT pending in the Bankruptcy Court.

 

1.75 “Heilig-Meyers” means Heilig-Meyers Company, a Virginia corporation, and a Debtor in Possession in the above-captioned Chapter 11 Case No. 00-34533-DOT pending in the Bankruptcy Court.

 

1.76 “Heilig Unsecured Claim” means any Unsecured Claim against Heilig-Meyers, Furniture Company, Heilig-Meyers Furniture West, Inc., MacSaver, and HMY Star, Inc.

 

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1.77 “Heilig Unsecured Claims Reserve” means the reserve established and maintained by the Liquidation Trustee pursuant to the terms hereof containing all Distributions that may be made on account of any Disputed Heilig Unsecured Claims to be reserved pending the entry of a Final Order allowing or disallowing such Disputed Heilig Unsecured Claims.

 

1.78 “Impaired” refers to any Claim or Interest that is impaired within the meaning of section 1124 of the Bankruptcy Code.

 

1.79 “Indentures” means collectively, the 7.40% Notes Indenture, the 7.60% Notes Indentures and the 7.88% Notes Indenture.

 

1.80 “Indenture Trustee” means Wells Fargo Bank Minnesota, N.A., as successor Indenture trustee pursuant to the Indentures.

 

1.81 “Indenture Trustee Fees” means the reasonable fees and expenses, including, without limitation, reasonable attorneys’ fees and disbursements, incurred by the Indenture Trustee, whether prior to or after the Petition Date and through the Effective Date; provided , however , that the Indenture Trustee Fees shall not include any fees incurred by the Indenture Trustee in seeking to enforce any of the rights that the holder(s) of the Bondholder Secured Claims may have against the Pre-Petition Lenders in respect of such holders’ claims that they have lien rights in and/or to the collateral proceeds received (or to be received) by the Pre-Petition Lenders on an equal and ratable basis with the Pre-Petition Lenders pursuant to Section 1008 of the Indentures and/or other applicable law.

 

1.82 “Initial Administrative Claims Bar Date” means the deadline for filing all proofs of claims or interests established by the Bankruptcy Court as August 29, 2003.

 

1.83 “Initial Administrative Bar Date Order” means that order entered by the Bankruptcy Court on June 23, 2003, which, among other things, established the Initial Administrative Bar Date.

 

1.84 “Initial Distribution Date” means, with respect to Distributions made to holders of Allowed Claims, other than holders of Allowed Unsecured Claims, a date selected by the Liquidation Trustee, which date shall not be more than 90 Business Days after the Effective Date, and, with respect to Distributions made to holders of Allowed Unsecured Claims, a date selected by the Liquidation Trustee, which date must not be less than 60 days prior to the termination of the Liquidation Trust.

 

1.85 “Intercompany Claim” means a Claim by a Debtor against another Debtor.

 

1.86 “Interest” means the legal, equitable, contractual and other rights (whether fixed or contingent, matured or unmatured, disputed or undisputed) of any Person with respect to the Old Common Stock or any options, warrants, puts, calls, subscriptions or other similar rights or other agreements, commitments, or outstanding securities obligating any of the Debtors to issue, transfer, purchase, redeem, or sell any

 

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shares of capital stock or other securities, any claims arising out of any appraisal or dissenter’s rights, any claims arising from rescission of a purchase, sale or other acquisition of any common stock or other equity security (or any right, claim, or interest in and to any common stock or equity security) of any of the Debtors, and any claims for damages or any other relief arising from any such purchase, sale, or other acquisition of such common stock or other equity security.

 

1.87 “Interestholder” means a holder of an Interest.

 

1.88 “Internal Revenue Code” means title 26 of the United States Code.

 

1.89 “Lender Avoidance Action” means the adversary proceeding filed in the Debtors’ Chapter 11 Cases styled Heilig-Meyers Company, et al. v. Wachovia Bank, N.A., et al. , Adv. Proc. No. 02-06158.

 

1.90 “Liquidation Trust” means the trust which is created pursuant to this Plan to be administered by the Liquidation Trustee subject to the direction of the Liquidation Trust Committee, all as more specifically set forth in this Plan.

 

1.91 “Liquidation Trust Committee” means the three-member committee as contemplated by the Trust Agreement.

 

1.92 “Liquidation Trustee” means the trustee of the Liquidation Trust as contemplated by the Trust Agreement.

 

1.93 “MacSaver” means MacSaver Financial Services, Inc., a Delaware corporation, and a Debtor in Possession in the above-captioned Chapter 11 Case No. 00-34538 pending in the Bankruptcy Court.

 

1.94 “New RoomStore Common Stock” means the common stock, $.01 par value per share, of Reorganized RoomStore to be issued in connection with the RoomStore Chapter 11 Case.

 

1.95 “Old Common Stock” means shares of Heilig-Meyers common stock that were authorized, issued and outstanding prior to the Effective Date.

 

1.96 “Other Priority Claim” means a Claim entitled to priority pursuant to section 507(a) of the Bankruptcy Code other than a Priority Tax Claim or an Administrative Claim.

 

1.97 “Other Priority Claims Reserve” means the reserve to be established and maintained by the Liquidation Trustee pursuant to the terms hereof containing all Distributions that may be made on account of any Disputed Other Priority Claims pending the entry of a Final Order allowing or disallowing such Disputed Other Priority Claims.

 

1.98 “Other Secured Claim” means any Secured Claim other than a Wachovia Secured Claim, Prudential Notes Secured Claim, Bondholder Secured Claim

 

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or Synthetic Lease Secured Claim. Other Secured Claims include Claims secured by liens junior in priority to existing liens, whether by operation of law, contract or otherwise, but solely to the extent of the value, as of the Effective Date, or such other date as is established by the Bankruptcy Court, of such Claimholder’s interest in the Estates’ interest in property of the Estates after giving effect to all security interests or liens senior in priority or, Claims subject to a permissible setoff under section 553 of the Bankruptcy Code or Final Order of a court of competent jurisdiction, to the extent of such permissible setoff.

 

1.99 “Other Secured Claim Reserve” means the reserve to be established and maintained by the Liquidation Trustee pursuant to the terms hereof containing all distributions that may be made on account of Disputed Other Secured Claims pending the entry of a Final Order allowing or disallowing such Disputed Other Secured Claims.

 

1.100 “Periodic Distribution Date” means (a) the Initial Distribution Date, as to the first distribution made by the Liquidation Trustee, and (b) thereafter, each Quarterly Distribution Date, as to each subsequent distribution made by the Liquidation Trustee.

 

1.101 “Person” means an individual, corporation, partnership, joint venture, association, joint stock company, limited liability company, limited liability partnership, trust, estate, unincorporated organization, governmental unit (as defined in section 101(27) of the Bankruptcy Code), or other Entity.

 

1.102 “Petition Date” means August 16, 2000, the date on which the Debtors filed their voluntary petitions commencing the Chapter 11 Cases.

 

1.103 “Plan” means this joint plan of reorganization, which is jointly proposed by the Debtors and the Creditors’ Committee for resolution of outstanding Claims and Interests in the Chapter 11 Cases, as such plan may be further amended from time to time in accordance with the Bankruptcy Code, the Bankruptcy Rules, and the provisions hereof.

 

1.104 “Plan Supplement” means those Exhibits to this Plan that shall be filed with the Bankruptcy Court by the Plan Supplement Filing Date.

 

1.105 “Plan Supplement Filing Date” means the date on which Exhibits and such other information to be included in the Plan Supplement shall be filed with the Bankruptcy Court, which date shall be at least ten (10) days prior to the Voting Deadline or such later date as may be approved by the Bankruptcy Court.

 

1.106 “Post-Petition Interest” means, collectively, such interest, reasonable fees, costs, or charges provided for under the agreements between a Debtor and a holder of a Secured Claim.

 

1.107 “Pre-Petition Lenders” means holders of Claims in Classes 2(a), 2(b) and 2(c).

 

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1.108 “Priority Tax Claim” means a Claim entitled to priority pursuant to section 507(a)(8) of the Bankruptcy Code.

 

1.109 “Pro Rata” means, from time to time, unless this Plan specifically provides otherwise, with respect to Allowed Claims, the same proportion that the amount of an Allowed Claim in a particular Class bears to the sum of the aggregate amounts of all Claims (including Disputed Claims, but excluding Disallowed Claims) of that particular Class of Claims.

 

1.110 “Professional” means those Persons employed in the Chapter 11 Cases pursuant to sections 327 and 1103 of the Bankruptcy Code or otherwise.

 

1.111 “Professional Claim” means a Claim of a professional retained in the Chapter 11 Cases pursuant to sections 327 and 1103 of the Bankruptcy Code or otherwise, including Bilzin Sumberg Baena Price & Axelrod LLP as special counsel to the Debtors, for compensation or reimbursement of costs and expenses relating to services rendered or expenses incurred after the Petition Date and prior to and including the Effective Date.

 

1.112 “Professional Fee Order” means the order entered by the Bankruptcy Court on August 16, 2000, authorizing the interim payment of Professional Claims subject to the Holdback Amount.

 

1.113 “Prudential Notes” means the 11.99% Series B Guaranteed Senior Notes due January 13, 2002 in the aggregate principal amount of $60 million, issued by MacSaver pursuant to the Prudential Notes Agreement and guaranteed by Heilig-Meyers.

 

1.114 “Prudential Notes Agreement” means that certain Note Agreement dated as of January 13, 1995, as amended, supplemented or otherwise modified prior to the Petition Date, by and between MacSaver, The Prudential Insurance Company of America and Pruco Life Insurance Company.

 

1.115 “Prudential Notes Secured Claim” means a Secured Claim arising under the Prudential Notes Agreement.

 

1.116 “Quarterly Distribution Date” means the first Business Day after the end of each quarterly calendar period ( i.e. , March 31, June 30, September 30 and December 31) of each calendar year following the Initial Distribution Date.

 

1.117 “Record Date” means the date established in the Confirmation Order or any other order of the Bankruptcy Court for determining the identity of holders of Allowed Claims for purposes of making Distributions under this Plan on account of Allowed Claims. If no Record Date is established in the Confirmation Order or any other order of the Bankruptcy Court, then the Record Date shall be the Confirmation Date.

 

1.118 “Reinstated” or “Reinstatement” means (a) leaving unaltered the legal, equitable and contractual rights to which a Claim entitles the Claimholder so as to leave such Claim Unimpaired in accordance with section 1124 of the Bankruptcy Code, or (b)

 

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notwithstanding any contractual provision or applicable law that entitles the Claimholder to demand or receive accelerated payment of such Claim after the occurrence of a default (i) curing any such default that occurred before or after the Petition Date, other than a default of a kind specified in section 365(a)(2) of the Bankruptcy Code; (ii) reinstating the maturity of such Claim as such maturity existed before such default; (iii) compensating the Claimholder for any damages incurred as a result of any reasonable reliance by such Claimholder on such contractual provision or such applicable law; and (iv) not otherwise altering the legal, equitable or contractual rights to which such Claim entitles the Claimholder; provided , however , that any contractual right that does not pertain to the payment when due of principal and interest on the obligation on which such Claim is based, including, but not limited to, financial covenant ratios, negative pledge covenants, covenants or restrictions on merger or consolidation, “going dark” provisions, and affirmative covenants regarding corporate existence prohibiting certain transactions or actions contemplated by this Plan, or conditioning such transactions or actions on certain factors, shall not be required to be cured or reinstated in order to accomplish Reinstatement.

 

1.119 “Released Parties” means, collectively, (i) all officers, directors, employees, consultants, agents, financial advisors, attorneys and other representatives of the Debtors which served in such capacities on and subsequent to the Petition Date; (ii) the Creditors’ Committee, including its agents, financial advisors, and attorneys in their capacities as such, and all current and former members of the Creditors’ Committee in their capacities as such; and (iii) with respect to each of the above-named Persons, such Person’s affiliates, principals, employees, agents, officers, directors, financial advisors, attorneys and other professionals, in their capacities as such.

 

1.120 “Reorganized RoomStore” means RoomStore and any successor thereto by merger, consolidation or otherwise following the effective date of a plan of reorganization in connection with the RoomStore Chapter 11 Case.

 

1.121 “Reserve” means any of, or collectively, the Administrative Claims Reserve, the Other Priority Claims Reserve, the Other Secured Claims Reserve, the Funded Debt Unsecured Claims Reserve, and the Heilig Unsecured Claims Reserve.

 

1.122 “RoomStore” means HMY RoomStore, Inc., a Virginia corporation.

 

1.123 “RoomStore Chapter 11 Case” means the chapter 11 case of RoomStore pending in the Bankruptcy Court and docketed as Case No. 00-34536.

 

1.124 “SEC” means the United States Securities and Exchange Commission.

 

1.125 “Scheduled” means, with respect to any Claim or Interest, the status, priority and amount, if any, of such Claim or Interest as set forth in the Schedules.

 

1.126 “Schedules” means the schedules of assets and liabilities and the statements of financial affairs filed in the Chapter 11 Cases by the Debtors, as such schedules or statements have been or may be amended or supplemented from time to time in accordance with Bankruptcy Rule 1009 or orders of the Bankruptcy Court.

 

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1.127 “Secured Claim” means a Claim (to include Postpetition Interest to the extent permitted by applicable law) held by a Claimholder and secured by a security interest in or lien on property of the Estates to the extent of the value, as of the Effective Date or such other date as is established by the Bankruptcy Court, of such Claimholder’s interest in the Estates’ interest in property of the Estates as determined by a Final Order of the Bankruptcy Court pursuant to section 506 of the Bankruptcy Code or as otherwise agreed upon in writing by the Debtors and the Claimholder, or, in the event that such Claim is subject to a permissible setoff under section 553 of the Bankruptcy Code or Final Order of a court of competent jurisdiction, to the extent of such permissible setoff.

 

1.128 “Security” shall have the meaning ascribed to it in section 101(49) of the Bankruptcy Code.

 

1.129 “Solicitation Procedures Order” means the order of the Bankruptcy Court approved on [ · ] , pursuant to which the Bankruptcy Court, inter alia , approved the Disclosure Statement and set various procedures for soliciting and tabulating votes on this Plan, as the same may have been amended or modified from time to time thereafter.

 

1.130 “Subordinated Claim” means a Claim subject to subordination under section 510(b) of the Bankruptcy Code that arises from the rescission of a purchase or sale of a debt or equity Security of any Debtor (including, but not limited to, the Unsecured Notes, Prudential Notes and Old Common Stock), or for damages arising from the purchase or sale of such debt or equity Security, or for reimbursement, indemnification, or contribution allowed under section 502 of the Bankruptcy Code on account of such Claim.

 

1.131 “Synthetic Lease(s)” means (a) that certain $12 million Tax Ownership Operating Lease in respect of certain properties located in Mount Sterling, Kentucky and Athens, Texas pursuant to the terms of, among other documents: (i) that certain Lease Agreement dated January 31, 1996, among State Street Bank and Trust Company, as owner-trustee and lessor, Arthur J. MacDonald, as trustee, and Furniture Company, as lessee, and (ii) that certain Participation and Credit Agreement dated as of January 31, 1996, among Furniture Company, State Street Bank and Trust Company, as owner-trustee, Wachovia Bank, N.A., as note holder and agent, and Wachovia Securities, Inc. as certificate holder, in each case as amended and modified; (b) that certain $40 million Tax Ownership Operating Lease in respect of certain properties in Hesperia, California and Richmond, Virginia pursuant to the terms of, among other documents: (i) that certain Lease Agreement dated as of August 1, 1996 among State Street Bank and Trust Company, as owner-trustee and lessor, and Furniture Company as lessee, and (ii) that certain Participation and Credit Agreement dated as of August 1, 1996, among Furniture Store, State Street Bank and Trust Company, as owner-trustee, Wachovia Bank, N.A. as note holder and agent, and Wachovia Securities, Inc. as certificate holder, in each case as amended and modified; and (c) that certain $46.6 million lease arrangement pursuant to the terms of, among other documents, that certain Lease Agreement dated as of August 5, 1998, between First Security Bank, National Association, as owner-trustee under the HM Realty Trust 1998-1, as lessor, and Furniture Company, as lessee, as amended and modified.

 

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1.132 “Synthetic Lease Secured Claim” means a Secured Claim arising under the Wachovia Credit Agreement.

 

1.133 “Trust Agreement” means that certain Liquidation Trust Agreement which is to govern the Liquidation Trust, substantially in the form attached in the Plan Supplement, pursuant to which, among other things, the Trust Assets shall be liquidated and distributed to the Claimholders in a manner consistent with the terms of this Plan.

 

1.134 “Trust Assets” means any and all assets of the Estates, which are to be transferred to the Liquidation Trust upon the Effective Date pursuant to Article 6.5 of this Plan.

 

1.135 “Trust Interest” means one (1) uncertificated beneficial interest out of the one hundred (100) million uncertificated beneficial interests in the Liquidation Trust.

 

1.136 “Trustee Professional(s)” shall have the meaning ascribed to it in Article 6.5 of this Plan.

 

1.137 “Unimpaired” refers to any Claim that is not Impaired.

 

1.138 “Unsecured Bondholder” refers to a holder of an Unsecured Claim arising from the Indentures.

 

1.139 “Unsecured Bondholder Claim” refers to any Unsecured Claim arising from the Indentures.

 

1.140 “Unsecured Claim” means a general unsecured claim which is a Claim against the Debtors that is not an Administrative Claim, Priority Tax Claim, or DIP Lender Claim and is not classified as a Claim included within any of Classes 1, 2, 3, 4, 6 and 7.

 

1.141 “Unsecured Notes” means, collectively, the 7.40% Notes, the 7.60% Notes, and the 7.88% Notes.

 

1.142 “Voting Deadline” means the deadline for voting on this Plan, as the same may from time to time be modified, set forth in the Solicitation Procedures Order.

 

1.143 “Wachovia” means Wachovia Bank, N.A.

 

1.144 “Wachovia Credit Agreement” means that certain Credit Agreement dated as of July 18, 1995, as amended, supplemented or otherwise modified prior to the Petition Date, by and between MacSaver, as borrower, Heilig-Meyers, as guarantor, Wachovia as administrative agent, Bank of America, N.A., as documentation agent, Crestar Bank, as co-agent, First Union National Bank, as co-agent, and the other lenders identified therein.

 

1.145 “Wachovia Secured Claim” means a Secured Claim arising under the Wachovia Credit Agreement.

 

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C.	Rules of Interpretation

 

The provisions of this Plan shall control over the contents of the Disclosure Statement, and the provisions of the Confirmation Order shall control over the contents of this Plan. For purposes of this Plan, unless otherwise provided herein: (a) any reference in this Plan to a contract, instrument, release 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; (b) any reference in this Plan to an existing document or schedule Filed or to be Filed means such document or schedule, as it may have been or may be amended, modified or supplemented pursuant to this Plan; (c) any reference to a Person as a holder of a Claim or Interest includes that Person’s successors and assigns; (d) all references in this Plan to Articles are references to Articles of this Plan; (e) the words “herein,” “hereunder” and “hereto” refer to this Plan in its entirety rather than to a particular portion of this Plan; (f) captions and headings are inserted for convenience of reference only and are not intended to be a part of or to affect the interpretation of this Plan; (g) subject to the provisions of any contract, certificate of incorporation, by-laws, instrument, release or other agreement or document entered into in connection with this Plan, the rights and obligations arising under this Plan shall be governed by, and construed and enforced in accordance with, federal law, including the Bankruptcy Code and Bankruptcy Rules; and (h) the rules of construction set forth in section 102 of the Bankruptcy Code shall apply.

 

D.	Computation of Time

 

In computing any period of time prescribed or allowed by this Plan, unless otherwise expressly provided, the provisions of Bankruptcy Rule 9006(a) shall apply.

 

E.

Exhibits

 

All Exhibits are incorporated into and are a part of this Plan as if set forth in full herein and, to the extent not annexed hereto, such Exhibits shall be filed with the Bankruptcy Court on or before the Plan Supplement Filing Date. After the Plan Supplement Filing Date, copies of Exhibits can be obtained upon written request to counsel to the Debtors or by downloading such exhibits from the Bankruptcy Court’s website at www.vaeb.uscourts.gov.

 

ARTICLE II

 

ADMINISTRATIVE CLAIMS

AND PRIORITY TAX CLAIMS

 

2.1 Administrative Claims

 

(a) Except to the extent that a holder of an Allowed Administrative Claim agrees to different treatment, the Debtors or the Liquidation Trust, as the case may be, shall pay to each holder of an Allowed Administrative Claim Cash in an amount equal to such Allowed Administrative Claim on, or as soon thereafter as is reasonably practicable,

 

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