Rizo-Lopez Foods - Chapter 11 Plan Terms

Plan Terms

Overview

• Rizo-López Foods, Inc. and its official committee of unsecured creditors filed a combined disclosure statement and joint Chapter 11 plan of liquidation on Oct. 6, 2026. The company is a California maker of Mexican-style cheese and cream products, and its Chapter 11 case followed a Listeria outbreak and product recall. The plan liquidates the debtor's remaining assets and distributes the proceeds to creditors through a liquidating trust. The trustee will be chosen by the committee.
• The plan follows the April 17, 2026, closing of the sale of substantially all of the debtor's assets to Francisco Foods, LLC. The sale carried aggregate consideration of about $35 million and returned net proceeds of about $5.86 million to the estate. A second sale, of the debtor's Riverbank Land, LLC subsidiary for $50,000 to an entity owned by the debtor's principals, is contested by the committee. Its hearing has been continued to Oct. 21, 2026.
• The remaining assets are mainly retained causes of action, about $1.16 million of retained cash and an employee retention tax credit claim of about $1.9 million gross. General unsecured claims are estimated at $91.39 million, with a projected recovery of "0.0% – Unknown." Recovery depends on litigation of the retained causes of action, recovery of the tax credit and a mandatory insurance mediation of recall claims.
• Edwin Rizo and Ivan Rizo (the Rizo Parties) are the debtor's principal owners and its DIP lenders, and entities they own lease the debtor its Modesto plant and Gardena site. Under the sale terms, the allowed administrative claims of the Rizo Parties and their affiliates, estimated at $491,552, are subordinated to the first $1 million paid to general unsecured creditors. Those claims form Class 4, a separate voting class.
• The combined hearing on final approval of the disclosure statement and confirmation is set for Nov. 18, 2026, at 11:00 a.m. (prevailing Pacific Time). Objections are due Nov. 4, 2026, at 5:00 p.m. (prevailing Pacific Time).

Background and Path to Chapter 11

• Edwin Rizo founded the debtor in California in 1990 to sell and distribute Mexican and Central American cheese in the San Francisco Bay Area, with a focus on the Mission District. It began making its own cheeses and creams in 1991. Ivan Rizo joined in 1995, when the brothers opened their first plant in Riverbank, California. Operations moved to Modesto in 2012, and the debtor later expanded distribution nationwide, grew to more than 320 employees and produced about 40 million pounds of cheese a year under the Don Francisco, Tío Francisco and Rizo Bros brands.
  • The plan's governance table lists Edwin Rizo as CEO and board chair, Ivan Rizo and Ivania Rizo as directors and Tomas Rizo as a director, CFO and secretary; its narrative instead names Ivan Rizo as board chair and Tomas Rizo as vice president of sales, marketing, administration and human resources. Edwin and Ivan Rizo hold all of the equity equally through family trusts.
  • Total sales were $140.98 million in 2023 and $15.67 million in 2024. EBITDA was $2.13 million in 2023.
• The debtor's facilities are tied to its owners:
  • The debtor leases the Modesto plant from I & E McClure, LLC, which Edwin and Ivan Rizo own equally, directly or through family members and trusts. Rent was $50,666 a month in 2025, and the lease expires Sept. 30, 2027.
  • The debtor pays R.L. Gardena, LLC, which is owned by Edwin and Ivan Rizo, $14,334 a month for a Gardena, California, site.
  • Riverbank Land, LLC is a wholly owned subsidiary that owns the original Riverbank processing site, which has not operated since 2022.
• In late 2023, Hawaii officials found Listeria in a sample of the debtor's aged cotija cheese. The same strain was later found in the debtor's plant and was genetically linked to a 10-year Listeria outbreak. The outbreak has allegedly been linked to 26 illnesses and two deaths.
  • The debtor recalled its cotija in early January 2024. It suspended operations after the FDA and CDC linked one of its products to the strain on Feb. 2, 2024. On Feb. 5, 2024, it issued an expanded voluntary recall of all cheese, yogurt and sour cream products. Recalls by downstream food producers followed.
  • The debtor, Edwin Rizo and Tomas Rizo entered a consent decree of permanent injunction with the FDA. It was signed Oct. 7, 2024, and entered by the U.S. District Court for the Eastern District of California on Oct. 8, 2024.
  • After satisfying the decree's conditions, the debtor received written FDA approval to resume plant operations on May 19, 2025. The plant decontamination was financed by the debtor's two primary shareholders. Production restarted on a limited basis on Aug. 5, 2025, under decree-mandated testing supervised by The Acheson Group.
• The recall forced the debtor to write off more than $6.7 million of accounts receivable and more than $4 million of finished goods inventory, and the debtor believes its exposure to potential liability may exceed its applicable insurance coverage. During the 16-month shutdown, the debtor could not complete its contracted milk purchases, and it defaulted on covenants under its Wells Fargo loans. It filed for Chapter 11 on Sept. 15, 2025, with about 121 employees.

Prepetition Capital Structure and Recall Claims

• Secured debt: at the petition date, the debtor owed Wells Fargo Bank and Wells Fargo Equipment Finance about $10.24 million, made up of:
  • six equipment loans totaling $5.02 million;
  • a tenant improvement (TI) loan of $2.33 million;
  • a revolving credit line of $2.89 million.
• I & E McClure guarantees the Wells Fargo Bank debt, and the TI loan is secured by a second deed of trust on I & E McClure's Modesto property. Wells Fargo Bank separately holds a $532,513 loan to I & E McClure, also secured by the Modesto property.
• The Rizo Parties invested $10.61 million to fund remediation and the FDA proceedings. That investment is secured by a second-priority lien on the debtor's personal property, perfected by a UCC-1 filed June 11, 2024. The debtor says it had to accept more than $10 million of insider financing because ordinary institutional financing was unavailable.
• Two creditors hold judgment liens: Blower-Dempsay Corporation, Inc. ($18,686.36, filed April 10, 2025) and Rexel USA ($23,412.65, filed July 14, 2025).
• Recall claims: at the petition date, the debtor faced potential damages of more than $70 million from several of its largest customers, Sargento, Reser's Fine Foods, Castle Importing and Amy's Kitchen. Asserted amounts include:
  • Sargento sued on March 8, 2024, in the Eastern District of Wisconsin for breach of contract and warranty. It claimed documented damages of nearly $2 million and projected damages of more than $59 million.
  • Reser's sued in the District of Oregon and claims about $3.7 million: $2.26 million of customer-claim reimbursements and $1.44 million of removal and disposal costs.
  • Castle Importing, a co-defendant in the Reser's suit, cross-claimed for nearly $4.7 million.
  • Latitude 36 Foods seeks $646,466.
  • Amy's Kitchen claims nearly $3 million, including $2.05 million of business expenses.
  • Pacific Cheese may allege $3.78 million but has not filed a proof of claim.
• Trade and consumer claims: the debtor owed 261 vendors about $6.1 million and 587 customers about $989,527. Separately, 5,000 to 6,000 consumers may assert claims.

Chapter 11 Case, Committee and DIP Financing

• The U.S. Trustee appointed the committee on Sept. 29, 2025. Its members are Sargento Foods Inc., Jimenez Mexican Foods, Inc., Arden Credits Group LLC (d/b/a R&D Incentives Group), Norcal Construction Poultry Specialist and Rana Meal Solutions, LLC. Sargento is both a committee member and the largest recall claimant, and it is a prequalified participant in the plan's insurance mediation.
  • The committee is represented by Tucker Ellis LLP as counsel and GlassRatner Advisory & Capital Group, LLC as financial advisor.
  • The committee investigated the debtor's prepetition secured debt, including the debt owed to its principals, and whether the estate had claims against the principal owners. It decided not to challenge the claims or liens of any holder of prepetition secured debt, a group that includes the Rizo Parties and their second-priority lien.
• The debtor is represented by McCormick Barstow LLP as bankruptcy counsel, Stapleton Group as financial advisor, Juarez and Company as accountant and Hyman, Phelps & McNamara as special FDA counsel. Donlin, Recano & Company (d/b/a Angeion Group) is claims, noticing and balloting agent.
• DIP financing: the interim DIP order allowed the debtor to borrow up to $3.76 million from the Rizo Parties under a senior secured postpetition facility. The debtor operated under a series of interim cash collateral and DIP orders, with protections for its prepetition secured lender, until the court entered final cash collateral and DIP orders on April 30, 2026 [Docs. 634, 635]. As its title states, the final DIP order grants postpetition liens and superpriority claims and limits prepetition liens under section 552(b).

Asset Sales

• Francisco Foods sale: the court approved a private sale of substantially all assets to Francisco Foods, LLC on April 2, 2026 [Doc. 572], and the sale closed April 17, 2026. The debtor had marketed the assets through private channels with the committee's support after concluding that a reorganization was not possible. Aggregate consideration of about $35 million consisted of:
  • $14.19 million in cash;
  • assumption of $2.9 million of DIP obligations owed to the Rizo Parties;
  • assumption of the Wells Fargo TI loan agreements and all related debt, $2.36 million;
  • waiver by the Rizo Parties and their affiliates of $15.55 million of payment rights on prepetition loan and lease obligations;
  • subordination of postpetition lease obligations owed to the Rizo Parties and their affiliates, which were the debtor's landlords at certain locations, to an aggregate payment of $1 million to general unsecured creditors.
• The buyer also assumed certain specified contracts. The estate's net proceeds were $5.86 million, and the liquidation analysis states that all Class 1 secured claims were paid in full at or around the closing.
• Riverbank sale (contested): on Sept. 9, 2026, the debtor moved to sell its 100% interest in Riverbank Land to R.L. Riverbank, LLC, an entity wholly owned by the Rizo Parties, for $50,000, subject to higher and better bids [Doc. 744]. A hearing took place Sept. 23, 2026, and on the committee's objection it was continued to Oct. 21, 2026. The plan's available-assets discussion is framed as of the closing of both sales, and the liquidation analysis assumes the Riverbank proceeds are received before the effective date.

Available Assets and Liquidation Analysis

• The estate's assets are mainly the retained causes of action, retained cash of $1.16 million and an employee retention tax credit claim of about $1.9 million gross. The debtor no longer generates operating income and does not project further receivable collections. It believes these assets can fund the plan process, achieve confirmation and position the trust to pursue the retained causes of action.
• The liquidation analysis compares a Chapter 7 liquidation with the Chapter 11 liquidating plan in low and high cases:
  • Total cash proceeds: $1.16 million in the low case under both Chapter 7 and the plan, and $3.06 million in the high case under both. Only the high case counts the $1.9 million tax credit. Litigation proceeds are "TBD."
  • Chapter 7 costs: trustee fees of $53,250 (low) to $89,471 (high), trustee professionals of $215,642 to $732,355, and Chapter 7 statutory fees of $10,410 to $27,510.
  • Costs in all cases: priority tax claims of $348,418, Chapter 11 professional claims of $518,366 and Chapter 11 statutory fees of $10,616.
  • Available cash: nil in the Chapter 7 low case, $1.33 million in the Chapter 7 high case, $279,303 in the plan low case and $2.18 million in the plan high case. After Class 2 priority non-tax claims of $192,771, the plan leaves $86,532 (low) or $1.99 million (high).
  • Recoveries in the Chapter 7 high case: Class 3 receives $1 million (1%) and Class 4 receives $137,196 (28%). Every class recovers 0% in the Chapter 7 low case except Class 1, which is shown at 100%. Under the plan, Class 2 recovers 100% in both cases, and Class 3 and Class 4 recoveries are "TBD."
• Under the analysis, Classes 2 through 4 are paid after the liquidating trustee's fees and expenses and the costs of liquidating the estate, which have not been determined. Litigation recoveries may increase distributions to Class 3 and potentially to Class 4. The debtor and committee expect better recoveries under the plan than in Chapter 7 because a Chapter 7 case would add trustee and professional costs and would not have a committee-selected trustee.

Treatment of Unclassified Claims

• Administrative claims: unpaid allowed administrative claims are projected at $0. Allowed administrative claims are paid in full in cash on the latest of the effective date, the claim's due date and 7 days after allowance, unless the holder agrees otherwise.
  • By agreement, the Rizo Parties' and their affiliates' allowed administrative claims, estimated at $491,552, are subordinated to an aggregate payment of $1 million to Class 3 and are classified in Class 4.
  • Requests for payment are due by the administrative claims bar date, the first business day that is 30 days after the effective date. Already-allowed professional claims and statutory fees are excepted. Late claimants are barred.
  • The plan does not extend bar dates set by the notice of commencement, including the deadline for section 503(b)(9) claims.
• Priority tax claims: unpaid allowed claims are projected at $348,418 and are paid in full in cash on the same timing as administrative claims. Penalties that do not compensate for actual pecuniary loss are treated as general unsecured claims.
• Professional claims: unpaid allowed claims are projected at $518,366.
  • Final fee applications are due by the administrative claims bar date, and objections are due 14 days after that date.
  • The fee hearing is to be held within 30 days after the administrative claims bar date, subject to the court's availability.
  • After the effective date, the trust may retain professionals without court approval.
• Statutory fees: fees due before the effective date are paid on the effective date. After that, the debtor and the trust are jointly and severally liable for them.

Classification and Treatment of Claims and Interests

• The debtor and committee will seek cramdown confirmation under section 1129(b) for any class that does not accept the plan. The estimated claim amounts exclude claims the debtor believes were filed in the wrong class.
• Class 1, secured claims (unimpaired, deemed to accept): estimated allowed amount $0; projected recovery 100%. The plan states that all Class 1 claims have been satisfied. Any remaining allowed secured claim would receive, at the option of the debtor or trustee, payment in full in cash up to the collateral's value, its collateral or other unimpairing treatment. Any deficiency is treated as a general unsecured claim.
• Class 2, priority non-tax claims (unimpaired, deemed to accept): estimated allowed amount $192,771; projected recovery 100%. Holders receive payment in full in cash on the latest of the effective date, the date of allowance and the claim's due date.
• Class 3, general unsecured claims (impaired, entitled to vote): estimated allowed amount $91.39 million; projected recovery "0.0% – Unknown." Holders receive a pro rata share of the liquidating trust assets, subject to the plan's insurance-mediation limits on distributions to recall claimants. Class 3 is entitled to the first $1 million of distributions ahead of Class 4. Claims for rejection damages and for non-compensatory tax penalties fall in this class.
• Class 4, subordinated administrative claims of the Rizo Parties and their affiliates (impaired, entitled to vote): estimated allowed amount $491,552; projected recovery "0.0% – Unknown." Holders receive a pro rata share of the trust assets only after an aggregate payment of $1 million to Class 3, subject to the same mediation limits.
• Class 5, interests (impaired, deemed to reject): all interests are canceled on the effective date with no distribution, and the liquidation analysis shows a 0% recovery in every case, though the plan's class table lists "0.0% – Unknown." The Class 5 voting paragraph names Class 4 as the deemed-rejecting class, while the class table, the voting section and the rest of that paragraph treat Class 5 as the non-voting class.
• The debtor or trustee may reclassify any allowed claim to reflect contractual, legal or equitable subordination under section 510. Subordinated claims receive nothing until all senior allowed claims are paid in full.

Insurance Mediation of Recall Claims

• The liquidating trustee succeeds to the debtor's policyholder rights under the recall-coverage policies, despite any anti-assignment term in the policies or nonbankruptcy law. The insurers keep all other policy defenses but may not challenge this assignment or raise it as a defense. All insurance policies, to the extent they are executory contracts, are assumed and assigned to the trust.
• The trustee and all recall claimants must take part in a mandatory mediation. Participants are:
  • the liquidating trustee;
  • the insurers that agree to participate. Arch is the primary carrier for 2023-24 and 2024-25. Indian Harbor (2024-25 only), Great American Insurance Group, Everest and Endurance provide excess layers;
  • all direct recall claimants;
  • subrogees, which may participate but are not required to;
  • named and additional insureds seeking coverage for recall claims;
  • counterparties to indemnification agreements that assert recall-related claims.
• Consequences of non-participation and settlement:
  • A recall claimant or subrogee that fails to participate irrevocably forfeits any trust distribution on its claims and any direct recovery from the policies or their proceeds.
  • A party that settles has its estate claim reduced by the amount it actually recovers from the policies.
• Eligibility:
  • The plan prequalifies Sargento Foods and Sargento Cheese; Reser's; Castle Importing; Latitude 36 Foods; Amy's Kitchen; and alleged subrogees of Sargento, Latitude 36 and Amy's Kitchen, none of which must file a notice of intent. The Sargento subrogees are Scottsdale, Pacific, Houston Casualty, Berkley Assurance and Charter Oak. Berkley Assurance is also the Latitude 36 subrogee, and Great American E&S and North American Capacity are the Amy's Kitchen subrogees.
  • Within 10 days after the effective date, the trustee must notify other known recall claimants and subrogees. They then have 10 days to submit a notice of intent to participate, and the trustee rules on qualification within 10 days after receiving it.
  • To qualify, a party must hold a direct recall claim or be a subrogee of one. The claim must arise from product manufactured between Jan. 1, 2023, and Feb. 5, 2024. The party, or its subrogor, must also have timely filed a proof of claim.
  • A party found not qualified may ask the court for a determination within five days, and the court's ruling is binding.
• Timing and cost:
  • The mediator is the Hon. Sidney I. Schenkier, a JAMS neutral, engaged by the trustee.
  • Mediation must begin no later than Jan. 1, 2027. All participants must stay in for an initial minimum three-month period unless they settle earlier.
  • The mediation may not continue beyond April 1, 2027, unless the trustee and the participants who want to continue agree.
  • The mediator's costs are shared equally during the initial three months and afterward only by parties that elect to continue.
  • Recall claimants must provide all damages documentation, including amounts already paid by subrogees, at least 45 days before mediation. Insurers must submit statements of their coverage defenses.
  • The mediation is confidential under California Evidence Code § 1119.
• The trustee must submit any settlement to the court within 5 days of reaching it, for approval on 21 days' notice. No settlement or related release is final until approved.
• Stay relief: participants receive immediate relief from the automatic stay and the plan injunction to obtain a judgment against the debtor, solely so they can pursue insurance proceeds, in three cases:
  • a failed mediation, declared when the mediator files a notice that good-faith efforts are exhausted;
  • no settlement by the end of the initial period or any voluntary extension;
  • a settlement with fewer than all insurers that does not fully resolve the claim. In that case, relief is limited to the remaining amount and to the non-settling insurers' policies.
• Unless the trustee agrees otherwise, no distribution is made on an allowed claim payable under the applicable policies until the initial three-month mediation period concludes. Portions of claims satisfied by insurers may be expunged without objection or court order.
• The mediation does not adjudicate the amount, priority or validity of any recall claim or proof of claim, and objections remain due by the claims objection deadline. Rights between subrogees and their subrogors, and all insurer rights and defenses, are expressly reserved.

Liquidating Trust and Trustee

• The liquidating trust is established on the effective date to liquidate and distribute the trust assets and wind down the case. The trust assets are all estate property not sold under the Francisco Foods or Riverbank sale orders. They include:
  • cash;
  • retained causes of action;
  • the debtor's rights under the Francisco Foods purchase agreement;
  • the applicable insurance policies and policyholder rights;
  • privileged records not transferred in the sale.
  These assets vest in the trust free and clear of claims, liens and interests.
• The committee selects the initial trustee. The trustee will be identified, and the terms of employment disclosed, in the plan supplement, which will also contain the trust agreement. The trustee posts no bond unless the court orders one. The trustee becomes the estate's sole representative and successor to both the debtor and the committee, with the powers of a bankruptcy trustee.
• Oversight committee: three members selected by the committee oversee and approve the trustee's decisions on material matters specified in the trust agreement. The trustee casts the deciding vote on ties.
• Term: the trust has an initial five-year term, which the trustee may extend under the trust agreement's procedures. The trust may terminate early once its assets are fully administered.
• Removal: the trustee may be removed for cause by motion, including:
  • willful failure to perform material duties, including undue prolongation of the trust, that is not cured within 30 days of written notice;
  • death or disabling incapacity;
  • fraud, theft, embezzlement or breach of fiduciary duty other than negligence;
  • a felony conviction with all appeals exhausted.
• Expenses and professionals: trust expenses are paid or reserved before any distribution. The trust may retain professionals without court approval, including firms that represented the debtor or the committee.
• Trust interests are uncertificated and nontransferable except by will, intestate succession or operation of law.
• Trustee liability: the trustee and its professionals are liable only for willful misconduct, gross negligence or actual fraud, and in the trustee's case also for breach of fiduciary duty other than negligence.
• Residual cash and unclaimed distributions left after final distributions go to a 501(c)(3) charity of the trustee's choice.

Retained Causes of Action

• All causes of action not expressly released by the plan or confirmation order are retained. Causes of action sold to Francisco Foods are excluded. The plan supplement will identify retained claims, but omission from it does not signal a release.
• The trust has sole standing and discretion to prosecute, settle or abandon the retained claims without further court order. Res judicata, estoppel, laches and other preclusion doctrines do not bar them as a result of confirmation.
• The court retains jurisdiction over disputes involving retained causes of action against current or former directors or officers.

Distributions and Claims Resolution

• Reserves: on the effective date, the trustee funds a priority reserve for disputed administrative, priority tax, priority non-tax and other secured claims. Before paying general unsecured creditors, it must also fund a reserve for disputed general unsecured claims. Both reserves are sized at the trustee's discretion and may be kept as bookkeeping entries.
• Timing: priority distributions are made on or soon after the effective date. Distributions to general unsecured creditors are made in amounts and at intervals the trustee considers prudent.
• Claims objections: the trustee may settle disputed claims without court approval. Objections are due by the claims objection deadline, the first business day at least 180 days after the effective date, which may be extended on the trustee's motion. Claims that were not scheduled and were not filed by the applicable bar date are disallowed. The trustee may seek estimation of disputed claims, and an estimated amount caps the claim.
• Holdbacks and offsets: claims of alleged avoidance-action transferees are treated as disputed. No distribution is made to a holder of a disputed claim until it is resolved. The trustee may set off estate claims against distributions.
• Distribution conditions:
  • No postpetition interest is paid, and recoveries are capped at 100% of the allowed claim.
  • Distributions under $50 may be held, and a final distribution under $50 may be canceled.
  • Distributions that stay undeliverable for 90 days revert to the trust.
  • Holders must return W-9 and OFAC certifications within 45 days of mailing, or they forfeit distributions made before the trustee receives them. The trustee may extend this deadline.

Executory Contracts and Insurance Policies

• On the effective date, all executory contracts and unexpired leases are rejected, except those previously assumed, assigned or rejected and those subject to a pending motion to assume. Rejection damages claims must be filed within 30 days after the effective date or are barred. Allowed rejection claims are treated as general unsecured claims.
• All insurance policies and recall-coverage policies are assumed and assigned to the trust, except policies previously rejected or subject to a pending motion to reject. The debtor does not assume obligations for any self-insured retention on which the insurer can assert a prepetition claim.
• Except for the forfeiture rule for non-participants in the mediation, the plan does not impair any insured's or indemnitee's access to coverage, and insurers keep their defenses.

Exculpation, Injunction and No Discharge

• The plan contains exculpation and injunction provisions but no debtor release or third-party release. Under section 1141(d)(3), the debtor receives no discharge.
• Exculpation:
  • Exculpated parties are the debtor; the committee and its members; the debtor's directors, officers and LLC managers as of the confirmation date, a board the plan's governance table lists as Edwin, Ivan, Tomas and Ivania Rizo; and professionals of the debtor, the committee and committee members.
  • It covers acts from the petition date through the effective date relating to the case, the DIP financing, the Francisco Foods sale and the plan.
  • It does not cover conduct found by final order to be gross negligence, bad faith or willful misconduct. Exculpated parties may rely on advice of counsel.
  • The trustee and trust professionals are not exculpated for post-effective-date conduct that creates liability under the trust agreement.
• Injunction: holders of claims and interests are permanently enjoined from suing, enforcing judgments, asserting liens or setting off against the debtor, the estate, the trust or the trustee on account of those claims or interests. Setoff rights formally asserted before confirmation are excepted, and recall claimants keep their stay-relief rights under the mediation procedures. Accepting a distribution is deemed consent to the injunctions.
• Injunctions granted in the Francisco Foods sale order are not affected.
• The committee dissolves on the effective date, except for fee applications, confidentiality obligations and plan enforcement. The debtor's officers and directors are deemed to resign. Edwin Rizo serves as the debtor's sole representative for pre-effective-date professional fee applications.

Conditions to Confirmation and the Effective Date

• Confirmation conditions:
  • the plan, the proposed confirmation order and the plan supplement are reasonably acceptable to the debtor and the committee;
  • the court has entered a final order approving the plan's disclosure as adequate;
  • the court has entered the confirmation order.
• Effective-date conditions:
  • the confirmation order has become a final order in a form reasonably acceptable to the debtor and the committee; and
  • the trustee has enough cash or other resources to fund both the priority reserve and the general unsecured claims reserve.
• The debtor and the committee, acting together, may waive any effective-date condition in whole or in part without notice or court order. The effective date is the first business day after all conditions are satisfied or waived, or a later date the debtor chooses in consultation with the committee. Notice of the effective date must be filed within three days after it occurs.
• If the effective date does not occur within 45 days after the confirmation date, the plan is void unless the court extends that deadline, and all parties return to their pre-confirmation positions.

Key Dates and Deadlines

• Sept. 15, 2025: petition date.
• Jan. 21, 2026, at 11:59 p.m. (PT): general bar date. March 16, 2026, at 11:59 p.m. (PT): governmental bar date.
• Oct. 5, 2026: the court approved a scheduling order at a continued status conference. Under that order, the debtor will move for interim approval of the disclosure statement and of solicitation and tabulation procedures.
• Oct. 21, 2026: continued hearing on the Riverbank sale.
• Nov. 4, 2026, at 5:00 p.m. (prevailing Pacific Time): deadline for objections to the disclosure statement and confirmation.
• Nov. 18, 2026, at 11:00 a.m. (prevailing Pacific Time): combined hearing on final approval of the disclosure statement and confirmation.
• Post-effective-date deadlines:
  • administrative claims bar date and final fee applications: first business day that is 30 days after the effective date;
  • rejection damages claims: 30 days after the effective date;
  • administrative claim objections: 180 days after the later of the administrative claims bar date and the filing of the claim;
  • other claims objections: first business day at least 180 days after the effective date;
  • mediation: must begin by Jan. 1, 2027, and may not continue beyond April 1, 2027, absent agreement.

Voting, Amendments and Other Provisions

• Voting: only Class 3 and Class 4 vote. A class accepts if holders of a majority in number and two-thirds in amount of the claims voting accept, excluding insider votes.
• Amendments: the debtor may amend the plan with the committee's written consent. Before confirmation it may do so at any time; after confirmation it needs notice and a hearing. No amendment may materially and adversely change any class's treatment.
• Controlling documents: the plan controls over other documents, and the confirmation order controls over the plan.

Risk Factors

• Insurance: there is no assurance the policies will cover all or most recall claims. The insurers have indicated that, in their view, they have defenses that may limit or eliminate coverage for some or all recall claims, and policy limits may not fully cover otherwise covered claims.
• Litigation: recoveries for general unsecured creditors depend largely on prosecuting the retained causes of action and on the outcome of the mediation, and their amount and timing are uncertain.
• Tax: the debtor or the trust may have to recognize cancellation-of-debt income from the sales. The debtor may have enough tax attributes to avoid a material cash liability, but the plan says this cannot be guaranteed.