Vi-Jon - Chapter 11 Plan Terms

Plan Terms

Overview

• Vi-Jon, LLC, a Delaware limited liability company that filed Chapter 11 in Delaware on Aug. 2, 2026, filed an amended plan of reorganization on Sept. 30, 2026 that channels all talc personal injury claims to a section 524(g) trust funded principally by a $25 million cash contribution from non-debtor affiliate Emprise Group, Inc. (formerly Vi-Jon Holdings, Inc.).
• The plan is jointly proposed by the debtor, the official committee of unsecured creditors and the future claimants' representative, The Honorable Shelley C. Chapman (Ret.), who serves as the legal representative for holders of future demands under sections 105(a) and 524(g); the debtor needs the other two plan proponents' consent to modify the plan before confirmation, and the three plan proponents and Emprise, to the extent of their restructuring support agreement consent rights, must agree to any waiver of confirmation-order requirements or effective-date conditions.
• The plan implements the Global Settlement defined in the restructuring term sheet attached to the restructuring support agreement dated July 30, 2026 among the debtor, Emprise, Emprise HPC, LLC (f/k/a Intermediary HoldCo, LLC), the future claimants' representative and the talc claimants' representatives.
  • Emprise HPC, sole member of the reorganized debtor, is also the debtor's counterparty under the Amended and Restated Limited Contribution Agreement dated July 30, 2026, which along with other loans funds the debtor's and the non-debtor affiliates' liquidity through the case.
  • Berkshire Partners LLC, Berkshire Fund VI Limited Partnership, Berkshire Investors LLC, Berkshire Investors III LLC, and John G. Brunner and any person or entity related to or affiliated with him are carved out of the deal as "Excluded Parties," receiving none of the plan's releases or protections; the debtor and the non-debtor affiliates are not Excluded Parties.
• The plan supplement, due no later than seven days before the plan objection deadline or a later date the court approves, will carry the operative documents, including the trust agreement, the cooperation agreement, the promissory note and pledge, the settlement fee letter agreement, the transferred and excluded assets schedules, the contract assumption and assignment schedules, the license agreement, the bill of sale, the schedule of excluded policies, the form of claimant release, the schedule of non-debtor affiliates, the reorganized debtor's amended organizational documents and the list of its managers and officers, the names of the trustee and trust advisory committee members, and the financial projections described in the disclosure statement. The debtor may amend the plan supplement through the effective date, subject to the plan's consent and consultation rights.

Trust Funding and Effective-Date Transactions

• Emprise contributes $25 million in cash to the Talc Personal Injury Trust on the effective date, a guaranteed contribution that cannot be reduced for professional claims or other obligations, and a separate $7 million in cash to the debtor to pay or reserve for general administrative expense claims, the GUC Recovery Pool and professional claims.
• The following transactions are deemed to occur simultaneously on the effective date, in consideration of reasonable, fair and adequate value exchanged, including the channeling injunction:
  • establishment of the trust;
  • the $25 million trust contribution and the $7 million debtor contribution;
  • issuance of the Vi-Jon Promissory Note and delivery of the pledge and security agreement to the trust;
  • assignment of the assigned causes of action to the trust;
  • assignment of the debtor's present and future rights, claims, benefits and causes of action under the talc insurance policies to the trust;
  • contribution by the non-debtor affiliates of their respective rights under and related to the talc insurance policies;
  • contribution of the net proceeds of the sale of the Etzel Property, after broker's commissions and other reasonable and documented costs of sale, or of the property itself;
  • Emprise's incurrence of the settlement fee obligation under the settlement fee letter agreement;
  • vesting of the trust assets in the trust; and
  • channeling of all talc personal injury claims to the trust.
• Trust assets consist of the $25 million contribution, the promissory note and related pledge, the assigned causes of action, the talc personal injury insurance assets, the non-debtor affiliates' talc insurance rights, the net proceeds of the real estate transaction or the Etzel Property itself, the right to the settlement fee, and all proceeds of the foregoing. All trust assets vest free and clear of claims, demands, interests and encumbrances without further court or party action.
• The assigned causes of action are the estate's claims not settled, released or otherwise resolved by the effective date that relate to coverage for talc personal injury claims under the talc insurance policies, relate to any talc personal injury claim, arise from the 2020 ESOP Transaction (solely against the Excluded Parties), or are Chapter 5 preference actions, including section 547 claims, together with related extracontractual and bad-faith theories; they exclude claims against the debtor's or the non-debtor affiliates' customers under Chapter 5 or any contract or purchase order, and claims to collect accounts owed to the debtor or the non-debtor affiliates. All other unreleased estate claims are retained causes of action that vest in the reorganized debtor, and the trust has no rights in them.
• Plan distributions split by source: the debtor funds administrative expense, priority tax, other secured, other priority and general unsecured claims from available cash and the $7 million Emprise contribution, while the trust funds talc personal injury claims exclusively from the trust assets, including the $25 million contribution and the talc insurance assets. The trust bears all of its own expenses; none of the plan proponents, the estate, the reorganized debtor or any other protected party has any obligation for trust expenses or other trust liabilities.
• The debtor will, on or before the effective date, pay or reserve in the applicable carve-out account the accrued and unpaid reasonable and documented fees and expenses incurred before the effective date by the committee, the future claimants' representative and their professionals. Shared services claims may be paid in the ordinary course under the cash management order on the terms of the underlying agreement, unless the debtor and Emprise agree to different treatment, which may include waiving them in whole or in part.

Vi-Jon Promissory Note and Equity Pledge

• Amount: $1 million original principal, issued by the reorganized debtor to the trust on the effective date.
• Maturity: 12 months after the effective date.
• Rate: non-interest bearing, prepayable at any time without premium or penalty.
• Security: a first-priority lien on 50.1% of the equity in the reorganized debtor under a non-recourse pledge and security agreement delivered by Emprise HPC as sole member; the confirmation order will provide that the lien is automatically perfected as of the effective date, and the note is otherwise non-recourse as to Emprise HPC.
• Remedies: if the reorganized debtor fails to pay the note in full at maturity, the trust may foreclose on the lien upon written notice to Emprise HPC and the reorganized debtor; separately, upon and during the continuation of a default, the trust may demand in writing that the reorganized debtor transfer to it ownership of 50.1% of the reorganized debtor's equity, which must be transferred within 20 days of the demand, with the reorganized debtor's organizational documents amended as needed to reflect the resulting ownership, governance and economic rights. The equity-transfer right remains enforceable until the earlier of full payment or discharge of the note and the trust's exercise of any remedy under it.
• The lien terminates immediately and automatically, without further court order, upon payment of the note in full on or before maturity.

Settlement Fee

• Trigger and amount: Emprise owes the trust a settlement fee only upon a sale or merger of Emprise at an enterprise value at or above $1 billion, equal to 50% of the first $40 million of gross consideration above $1 billion in that transaction, payable under a letter agreement delivered on the effective date in form and substance acceptable to Emprise, the committee and the future claimants' representative.
• The trust gets consultation rights over computation of the fee, including receipt of sufficient information to assess the enterprise value calculation, and retains its rights under applicable law to dispute the fee; all parties' rights under the letter agreement are fully reserved, and the Bankruptcy Court retains jurisdiction over any dispute concerning the calculation, the enterprise value of Emprise or the gross consideration used.

Talc Personal Injury Trust

• The trust is established on the effective date under section 524(g) and will qualify at all times as a "qualified settlement fund" under section 468B of the Internal Revenue Code. Its purpose is to assume all liability and responsibility for talc personal injury claims; direct the processing, liquidation and payment of all compensable claims under the plan, the trust agreement, the trust distribution procedures and the confirmation order; and preserve, hold, manage and maximize its assets, resolving claims so that holders are treated fairly, equitably and reasonably in light of the finite assets available.
• Governance and appointments:
  • The initial trustee is the individual nominated by the committee and the future claimants' representative and named in the plan supplement, appointed on the effective date, with all costs and expenses paid by the trust; the initial Delaware trustee will likewise be named in the plan supplement and appointed under the confirmation order.
  • Subject to approval in the confirmation order, Chapman is appointed post-effective-date future claimants' representative on the effective date, with all of her costs and expenses borne by the trust.
  • The trust advisory committee is established under the trust agreement, with the number and identity of the committee's nominees for initial members set out in the plan supplement; the confirmation order constitutes the order appointing them.
• Claims administration: only the trust may review and resolve talc personal injury claims, and all such claims must be submitted solely to it under the trust agreement and the trust distribution procedures. The trust is deemed the appointed representative of the debtor and reorganized debtor for evaluating, defending, litigating and resolving those claims, and may pursue, litigate, compromise and settle any rights, claims or causes of action transferred to it; from and after the effective date it has standing, in its sole discretion and at its own expense, to pursue, compromise or settle all proceedings relating to any unreleased asset, liability or responsibility. The trust keeps all defenses and counterclaims to claims asserted against it, including setoff, recoupment and section 502(d) and (e) rights, but none of its claims, defenses or causes of action may be asserted against any protected party, and it has no rights against the reorganized debtor or the protected parties other than to enforce the plan documents. The trust has no liability for any claims other than talc personal injury claims and trust expenses.
• Every holder must execute a talc personal injury claimant release as a precondition to payment from the trust, and neither that release nor the trust distribution procedures may be materially amended after the effective date in any way that impairs the plan's releases and injunctions or the trust's qualified-settlement-fund status. The release form may be modified only with the consent of the committee and the future claimants' representative, or of the trust advisory committee and post-effective-date future claimants' representative as applicable, and any material modification affecting the availability of sections 524(g) and 105, the confirmation or district court orders, the trust, or the efficacy or enforceability of the channeling injunction or other protections must be reasonably acceptable to the debtor or reorganized debtor and Emprise.
• The trust must protect, defend, indemnify and hold harmless each protected party against any talc personal injury claim, with the protected parties' sole and exclusive remedies for a failure limited to seeking reimbursement of resulting expenses from the trust or asserting money damage claims against it, and with the trust's obligations capped at the value of its assets.
• Indirect talc personal injury claims may be disallowed by the trust under section 502(e) or subordinated under section 509(c).
• The cooperation agreement becomes effective on the effective date between the reorganized debtor and the trustee, transferring, assigning or making available the documents, information and related privileges reasonably necessary to investigate, prosecute, compromise or settle the insurance assets and assigned causes of action without waiver or destruction of privilege, and governing the treatment of the debtor's talc and asbestos-related records.

Insurance Rights

• On the effective date the debtor is deemed to assign to the trust all of its and the reorganized debtor's present and future rights, claims, benefits and causes of action under the talc insurance policies, including all rights to coverage and proceeds, rights under any coverage settlement agreements, and the right on the debtor's behalf to compromise with or fully release any talc insurer. The non-debtor affiliates are simultaneously deemed to contribute their own rights under and related to those policies.
• From the effective date, the trustee, with the consent of the trust advisory committee and the post-effective-date future claimants' representative as set forth in the trust agreement, holds the sole right and authority to assert, prosecute and settle coverage claims.
• The talc insurance policies are the commercial general liability and products liability policies in effect on or before the effective date that may cover the debtor for talc personal injury claims; other policy types, including director and officer, property and casualty, and crime policies, are excluded, as are policies issued in or after 2016 that contain valid talc exclusions. Those post-2016 policies are listed on the schedule of excluded policies and are not assigned to the trust; that schedule may be modified only with the consent of the committee and the future claimants' representative, or of the trust advisory committee and post-effective-date future claimants' representative as applicable, which consent may not be unreasonably withheld.

Asset Transfers and the Etzel Property

• On or after the effective date the debtor transfers a material set of its assets, listed on the transferred assets schedule, to the applicable non-debtor affiliates under a bill of sale, in exchange for the $7 million debtor contribution and the $25 million trust contribution, on an "as is, where is" basis and free and clear of claims, liens and interests to the fullest extent permitted by the Bankruptcy Code. The transferred assets exclude both the excluded assets and the trust assets.
• The excluded assets, listed on the excluded assets schedule, include all right, title and interest in certain intellectual property, which the reorganized debtor will license to one or more non-debtor affiliates under a license agreement entered into in connection with the transfer.
• The Etzel Property, 14 parcels the debtor owns on Etzel, Bartmer, Spencer and Suburban Avenues in St. Louis, follows a three-step waterfall: if the sale closes under section 363 during the case, the debtor contributes the net proceeds to the trust; if it does not, the debtor sells the property on or after the effective date on terms acceptable to Emprise, the committee and the future claimants' representative and contributes the net proceeds; and if any of those three withholds consent to the selected purchaser, or the debtor cannot find a purchaser, the debtor contributes the property itself to the trust on the effective date.
• Any sale under the real estate transaction is on an "as is, where is" basis, free and clear of claims, liens and interests to the fullest extent permitted by the Bankruptcy Code, and exempt under section 1146(a) from state, city or other municipal transfer taxes, mortgage recording taxes and any other stamp or similar tax.
• All remaining property of the estate and any property acquired or retained by the debtor under the plan, other than the professional claim reserve account, vests in the reorganized debtor on the effective date free and clear of liens, claims, charges and other encumbrances.

Treatment of Claims and Interests

• Class 1, other secured claims (unimpaired, deemed to accept): at the debtor's or reorganized debtor's option, payment in full from available cash attributable to the holder's collateral, return of the collateral in satisfaction of the allowed amount, or other treatment sufficient to render the claim unimpaired.
• Class 2, other priority claims (unimpaired, deemed to accept): payment or other treatment in accordance with the Bankruptcy Code in full satisfaction.
• Class 3, general unsecured claims (impaired, entitled to vote): a pro rata share of the GUC Recovery Pool, a $100,000 amount set aside by the debtor from available cash on the effective date. Rejection damages claims are classified and treated here unless they fall within the definition of a talc personal injury claim or indirect talc personal injury claim.
• Class 4, talc personal injury claims (impaired, entitled to vote): liability is permanently channeled, automatically and without further act, deed or court order, solely and exclusively to the trust and assumed by it; each claim is resolved under the trust distribution procedures; the holder's sole recourse is the trust, with no right at any time to assert the claim against any protected party and with assertion barred by the channeling injunction.
• Class 5, intercompany claims (impaired, deemed to reject): cancelled, released and extinguished without any distribution or compensation. The class covers all non-debtor affiliate claims against the debtor, including Vivos Holdings, LLC's and VH Finance, LLC's claims under the Dec. 3, 2023 intercompany promissory note and Emprise's claims under the intercompany advance agreement effective Sept. 5, 2024; shared services claims for prepetition goods and services are deemed intercompany note claims, while postpetition shared services claims are excluded from the class.
• Class 6, section 510(b) claims (impaired, deemed to reject): cancelled, released and extinguished without any distribution or compensation. The class captures all claims relating to the ESOP litigation, the putative class action Laidig, et al. v. GreatBanc Trust Company, et al. pending in the U.S. District Court for the Northern District of Illinois, and related contribution, subrogation, reimbursement, indemnity and guaranty claims.
• Class 7, existing equity interests (impaired, deemed to reject): reinstated and reissued to Emprise HPC without any distribution, leaving Emprise HPC owner of 100% of the reorganized debtor interests and all rights to distributions on them, subject to the 50.1% pledge securing the promissory note.
• General administrative expense claims, shared services claims, professional claims and priority tax claims are unclassified. Allowed general administrative expense claims are paid in full in cash on the effective date or, if allowed later, within 45 days after the allowing order becomes final, with payment requests due 30 days after the effective date; professionals' final fee applications are due 45 days after the effective date and are paid from the applicable carve-out account, or by the reorganized debtor if that account falls short, with any reserve surplus reverting to the reorganized debtor; and allowed priority tax claims receive regular cash installments over a period ending no later than five years after the petition date, prepayable without penalty. Emprise HPC selects, in its sole discretion, the managers and officers of the reorganized debtor named in the plan supplement.

Voting and Confirmation Thresholds

• Classes 3 and 4 are the voting classes. Class 3 acceptance is determined under section 1126; Class 4 acceptance under sections 524(g) and 1126. If a voting class contains eligible claims but no holder votes, the plan is presumed accepted by that class.
• The court will be asked to issue the channeling injunction if Class 4 accepts by at least two-thirds in amount of those actually voting, with claims temporarily allowed for voting purposes in the amounts set in the disclosure statement order, and 75% in number of those actually voting under section 524(g)(2)(B)(ii)(IV)(bb).
• The debtor requests cramdown under section 1129(b) as to any class deemed to reject, and reserves the right to seek cramdown as to any voting class other than Class 4 that votes to reject.
• Following entry of the confirmation order, the debtor must obtain a district court order affirming that order and the channeling injunction under section 524(g).

Channeling Injunction and Insurance Entity Injunction

• The channeling injunction permanently bars all present and future holders of talc personal injury claims from any direct, indirect or derivative recovery against any protected party, whether by indemnity, contribution, subrogation or aiding and abetting, including from: commencing or continuing any suit, action or proceeding in any forum anywhere in the world against any protected party or its property; enforcing, levying, attaching, collecting or otherwise recovering on any judgment, award, decree or order; creating, perfecting or enforcing any encumbrance; setting off, seeking reimbursement or contribution from, subrogating against or recouping any amount against any liability owed to a protected party; and proceeding on any matter designated for resolution by the trust other than in conformity with the trust agreement and trust distribution procedures.
  • Protected parties are the debtor, the reorganized debtor, the non-debtor affiliates and the related parties of each. The non-debtor affiliates are Emprise and its current and former affiliates and their successors and assigns, including those on the schedule of non-debtor affiliates, but exclude the debtor, the Excluded Parties, and any affiliates or predecessors of the debtor that are not current affiliates of Emprise. No Excluded Party is a protected party.
  • The injunction does not bar claims against the trust under the trust documents, the trust's own insurance claims, claims for trust expenses, claims by talc claimants against anyone other than a protected party, or the trust's enforcement of its rights under the plan and trust documents. Those reservations do not permit indirect talc personal injury claims against protected parties, which remain subject to the injunction, are channeled exclusively to the trust, and may be subordinated or disallowed.
• Talc personal injury claims, including future demands, cover claims arising from exposure to talc or asbestos tied to the pre-effective-date conduct of the debtor or Vi-Jon, Inc., together with indirect contribution and indemnity claims and claims on alter ego, successor liability and fraudulent transfer theories. Against a protected party other than the debtor, a claim is covered only to the extent that party is alleged to be liable for the debtor's conduct by reason of a financial interest in the debtor or an affiliate or predecessor, involvement in or service to the debtor's management, provision of insurance, or involvement in a corporate-structure change or financing transaction affecting the debtor. Workers' compensation claims and environmental liabilities are excluded.
• A separate Insurance Entity Injunction, issued under the court's equitable jurisdiction to protect the trust and preserve its assets, stays and enjoins all entities, including additional insureds, from pursuing talc-related claims, demands or causes of action against any talc insurer, or that insurer's property, whether by suit, judgment enforcement, encumbrance, setoff, subrogation, indemnity, contribution or recoupment. It is not issued for any talc insurer's benefit and no insurer is a third-party beneficiary; it does not impair actions the trust brings against any insurer; and the trust holds sole and exclusive authority to terminate, reduce or limit its scope as to any insurer on express written notice. Nothing in it affects insurance coverage or rights of the reorganized debtor, the non-debtor affiliates or their related parties that are not assigned or contributed to the trust.
• Confirmation discharges the debtor and reorganized debtor under sections 524 and 1141(d)(1)(A) from all claims and demands, including those arising before the confirmation date and debts specified in sections 502(g), (h) and (i), regardless of whether a proof of claim was filed or scheduled, whether the claim was allowed, or whether the holder voted on or accepted the plan; a parallel discharge injunction bars suits, judgment enforcement, encumbrances, setoffs and worldwide actions against the debtor, the reorganized debtor and their property.
• All injunctions and stays in effect under sections 105 or 362 or any court order remain in full force until the effective date.

Releases

• Debtor release of the non-debtor affiliates: the debtor, the reorganized debtor and any entity exercising estate rights unconditionally release each non-debtor affiliate and its related parties from all claims and causes of action arising on or before the effective date, expressly including all claims arising out of or relating to the 2023 Transaction, the transactions consummated on or before Dec. 3, 2023 and Dec. 28, 2023 among the debtor, Emprise (f/k/a Vi-Jon Holdings, Inc.) and their affiliates. The release preserves rights under the plan and plan documents, assigned causes of action against the Excluded Parties relating to the 2020 ESOP Transaction, and direct causes of action that talc claimants hold against the non-debtor affiliates or any entity other than the debtor.
• Debtor release of the other released parties: the same releasing parties release the remaining released parties, excluding liability arising from a criminal act, actual fraud or willful misconduct as determined by a final order.
• Third-party release: each releasing party releases the released parties, including the non-debtor affiliates and their related parties, from all claims relating to the debtor, the estate, the 2023 Transaction, the restructuring support agreement, the restructuring transactions, the Chapter 11 case, the plan and plan documents and the reorganized debtor, including all talc-related claims and causes of action against the non-debtor affiliates and their related parties. Carve-outs preserve rights under the plan and plan documents, claims arising from a released party's criminal act, actual fraud or willful misconduct as determined by a final order, and the assigned causes of action against the Excluded Parties arising out of the 2020 ESOP Transaction. Nothing in the third-party release relieves a talc claimant of the requirement to execute a claimant release to recover from the trust.
• Released parties are the debtor, the reorganized debtor, the non-debtor affiliates, the committee and its members, the future claimants' representative and, to the fullest extent permitted by law, each of their related parties, in each case unless the entity is an Excluded Party. Related parties include an entity's predecessors, successors, permitted assigns, equity holders, subsidiaries and affiliates; its current and former officers, directors, managers, principals, members, employees and professionals; heirs and estates; and any lender or other provider of a loan or other financial transaction, solely in that capacity.
• Releasing parties are the debtor, the reorganized debtor, the non-debtor affiliates, the committee and its members, the future claimants' representative, all holders of claims or interests that affirmatively opt into the third-party release, and the related parties of each of the foregoing solely to the extent they could assert claims derivatively through those entities. The third-party release is thus opt-in for holders.
• An injunction enforces the releases, barring the releasing parties from commencing or continuing actions, enforcing or collecting judgments, creating, perfecting or enforcing encumbrances, asserting setoff, subrogation or recoupment against obligations owed to a released party, and pursuing worldwide actions inconsistent with the plan or confirmation order.
• Preservation of assigned causes of action: except to the extent released under the debtor's release of the non-debtor affiliates as part of the settlement embodied in the restructuring support agreement and the plan, nothing in the release article impairs any assigned cause of action, all of which remain preserved for transfer to and enforcement by the trust. The 2020 ESOP Transaction was the 2020 series of transactions in which certain VJCS Holdings, Inc. shareholders sold their equity to the Vi-Jon Employee Stock Ownership Trust, making Vi-Jon 100% employee owned; the assigned causes of action against the Excluded Parties arising from it are expressly preserved and not released, as are Chapter 5 preference actions, including section 547 claims, that constitute assigned causes of action, except to the extent released under the debtor's release of the non-debtor affiliates.
• The debtor waives the effect of section 1542 of the California Civil Code to the extent applicable, while stating it does not believe California law applies; that waiver does not alter the treatment, releases or channeling injunction for talc personal injury claims or the claimant-release precondition to payment from the trust.

Exculpation and Section 1125(e) Protection

• Exculpated parties incur no liability for acts or omissions from the petition date through the effective date in connection with the Chapter 11 case, the negotiation and preparation of the plan and plan documents and their settlements and compromises, the pursuit of confirmation, consummation or administration of the plan or the property distributed under it or the trust distribution procedures, or the plan's releases and injunctions, except for criminal acts, actual fraud, willful misconduct or gross negligence as determined by a final order; all exculpated parties may rely on advice of counsel.
• The exculpated parties are the debtor; the members of its board of managers, including the special committee, its officers and its chief restructuring officer who served at any time between the petition date and the effective date; the committee and each of its members; the future claimants' representative; the professionals and advisors retained by the debtor, the committee or the future claimants' representative in connection with any restructuring transaction or the case, and their personnel; and, solely as to conduct a court finds was undertaken while acting as an estate fiduciary, debtor employees and others providing similar services and counsel to the individual committee members, though the court is not determining their fiduciary status and the burden of establishing it does not shift.
• The section 1125(e) protected parties are deemed to have acted in good faith and receive the section's protections. They include the debtor, the reorganized debtor, the non-debtor affiliates, the committee and its members, the future claimants' representative, Chapman in her capacity as prepetition future claimants' representative under the restructuring support agreement, the ad hoc committee of talc personal injury claimants that preceded the committee prepetition and its members, the lenders funding the Emprise HPC limited contribution agreement and the other liquidity loans and the two Emprise effective-date contributions solely as solicitation and securities participants, and the directors, managers, governing-body members, officers and professionals of each. No Excluded Party is a section 1125(e) protected party.

Executory Contracts and Unexpired Leases

• On the effective date the debtor assumes the contracts and leases on the schedule of assumed contracts and leases and assumes and assigns to the applicable non-debtor affiliates or their designees those on the schedule of assigned contracts and leases; the debtor has already served cure notices on the counterparties. Everything else is deemed rejected as of the effective date, other than contracts previously rejected, assumed or assumed and assigned under a final order entered on the effective date that become fixed on or before that date, or subject to a pending motion as of the effective date. The confirmation order approves the rejections, assumptions and assignments under sections 365 and 1123.
• Emprise pays cure: under the plan's contract article, monetary defaults are satisfied under section 365(b)(1) by Emprise's payment of the applicable cure in cash on the effective date, or on other terms the counterparty and the debtor, Emprise or the applicable non-debtor affiliate agree; the confirmation-order requirements specify Emprise's cure obligation for contracts assumed and assigned to the non-debtor affiliates. Where a dispute over the existence or amount of cure, adequate assurance of future performance, or any other assumption-and-assignment matter remains pending on the effective date, payment is made after entry of a final order resolving the dispute and approving the assignment, provided the contract has not been pulled from the schedule.
• Each non-debtor affiliate or designee may remove any contract or lease from the assigned schedule by written notice to the debtor at any time before the effective date, and where a cure, adequate assurance or other assignment dispute exists, through and including seven business days after entry of a final order resolving it; the debtor then amends the schedule and gives any notice the court requires. A removed contract is not assigned and, unless the debtor or reorganized debtor elects to assume it, is deemed rejected as of the effective date, with the non-debtor affiliate acquiring no rights, assuming no liabilities, and Emprise owing no cure.
• The debtor's obligations to indemnify current and former managers and officers survive confirmation undischarged, provided none is a talc personal injury claim, and are assumed by the reorganized debtor solely to preserve access to D&O insurance proceeds; recovery is limited to those proceeds, and any unsatisfied balance is a general unsecured claim against the debtor and remains subject to the channeling injunction to the extent it is a talc personal injury claim.

Confirmation Order Requirements

• The confirmation order must be acceptable in form and substance to the debtor, Emprise, the committee and the future claimants' representative, in each case to the extent of their consent, approval and consultation rights under the restructuring support agreement and restructuring term sheet, and must among other things: approve and provide for issuance of the channeling injunction subject to findings that Class 4 voted in the requisite numbers and amounts under sections 524(g), 1126 and 1129; provide that Emprise HPC receives the reorganized debtor interests subject to the pledge securing the note; provide for delivery of the note by the reorganized debtor and the pledge by Emprise HPC; provide that all plan transfers of the debtor's assets are free and clear of claims and encumbrances; authorize the assignment of talc insurance rights to the trust notwithstanding any policy terms or law argued to prohibit it, and bar talc insurers from defending on the grounds that the plan does not comply with the Bankruptcy Code or that the assignment is prohibited by any policy; confirm the section 1146(a) exemption for transfers under the plan, including the real estate transaction; condition any trust distribution on execution of the claimant release; and approve the trust agreement, the trust distribution procedures, the other trust documents and the releases of the released parties, including the non-debtor affiliates and their related parties.
• Required findings include that the trust is funded by contribution of the trust assets, including the $25 million Emprise contribution; that Emprise HPC will own 100% of the reorganized debtor interests and all rights to distributions on them, subject to the 50.1% pledge; that the transfer of the transferred assets to the non-debtor affiliates and any plan sale of the Etzel Property convey good title free and clear of claims, liens and interests under sections 1123 and 1141(c), and do not by themselves make any transferee or purchaser a successor to the debtor or subject it to successor or transferee liability, other than for liabilities it expressly assumes, with talc claimants seeking to impose such liability on a protected party remaining subject to the channeling injunction; that the plan separately classifies talc personal injury claims in Class 4 and that at least two-thirds in amount and 75% in number of the holders in that class actually voting have accepted; that the trust will have sole and exclusive authority as of the effective date to satisfy, settle or defend against all talc personal injury claims; that the trust assets together with the non-debtor affiliates' contributions, agreements and accommodations are a sufficient basis for the protections afforded the protected parties; that the channeling and insurance entity injunctions are fair and equitable to all holders of talc personal injury claims, including demands; and that the releases granted to the debtor and its related parties and to the non-debtor affiliates and their related parties, in exchange for the contributions made in connection with the Global Settlement, including the $25 million contribution and the contribution of talc insurance rights, are essential to the Global Settlement.

Conditions Precedent to the Effective Date

• All conditions must be satisfied, unless waived, on or before the plan-consummation deadline under the restructuring support agreement, as extended in accordance with it:
  • all conditions to the confirmation date satisfied or waived and continuing to be so, with the confirmation date having occurred by the applicable restructuring support agreement deadline;
  • the restructuring support agreement remaining binding, valid and not terminated as to any party;
  • entry of the confirmation order in form and substance acceptable under the confirmation-order requirements, and that order being a final order;
  • no pending request for revocation of the confirmation order under section 1144;
  • no fact or circumstance preventing the channeling injunction and insurance entity injunction from taking full effect immediately upon the effective date;
  • the $25 million trust contribution and $7 million debtor contribution funded or funding contemporaneously with the effective date;
  • no fact or circumstance preventing the trust from being funded with the trust assets, including the $25 million contribution;
  • entry by the district court of the order affirming the confirmation order, including affirmance of the channeling injunction under section 524(g); and
  • execution and delivery of all plan documents and all other actions, documents and agreements necessary to implement the plan's effective-date provisions, in form and substance satisfactory to the plan proponents and Emprise to the extent of their consent, approval and consultation rights.
• The effective date is the business day the debtor selects once those conditions are satisfied or waived.
• Waiver: the confirmation-order requirements and effective-date conditions may be waived or modified, in whole or in part, by mutual consent of the plan proponents and Emprise to the extent each holds a consent right under the restructuring support agreement and restructuring term sheet, evidenced by confirmatory email from counsel, subject to any applicable consent standard, and effective at any time without leave or order of either court and without other formal action.

Termination and Failure to Achieve the Effective Date

• The non-debtor affiliates' obligations to support the plan and to make the $25 million trust contribution, the $7 million debtor contribution and all other contributions, agreements and accommodations terminate if an event entitling Emprise and Emprise HPC to terminate the restructuring support agreement occurs before the effective date and they exercise that right, unless they agree otherwise in writing.
• If the effective-date conditions are not met or duly waived, the confirmation order is vacated on the debtor's motion with the consent of the other plan proponents and notice as the court directs.
• If the plan proponents jointly revoke or withdraw the plan, the confirmation order is vacated, the plan is not confirmed by a final order, or the plan is confirmed but never goes effective, all parties' rights are reserved in full; the plan becomes null and void, as do any settlement or compromise embodied in it, any contract assumptions or assumptions and assignments effected by it, the non-debtor affiliates' funding commitments and any document executed under it; and nothing in the plan, the confirmation order or acts taken in preparation for consummation constitutes a waiver, release or settlement of claims, prejudices any party's rights in further proceedings, or constitutes an admission.
• The debtor reserves the right to revoke or withdraw the plan before entry of the confirmation order and to file subsequent plans of reorganization.

Plan Modification

• Before entry of the confirmation order, the debtor may alter, amend or modify the plan and its exhibits under section 1127(a) with the consent of the other plan proponents, which may not be unreasonably withheld, so long as the modified plan satisfies sections 1122 and 1123, without additional disclosure under section 1125 and Rule 3019.
• After confirmation, the debtor or reorganized debtor may cure defects or omissions and reconcile inconsistencies in the plan documents only if the interests of holders of allowed claims are not adversely affected; the modifications are non-material; the committee and the future claimants' representative or, after the effective date, the trust advisory committee and post-effective-date future claimants' representative consent, which consent may not be unreasonably withheld, conditioned or delayed; the non-debtor affiliates consent on the same standard; and the U.S. Trustee does not object, unless overruled.
• Entry of the confirmation order means all modifications or amendments since solicitation are approved under section 1127(a) and require no additional disclosure or re-solicitation under Rule 3019, or that any disclosure or re-solicitation performed was sufficient.

Dissolution of the Committee and the Future Claimants' Representative

• The committee dissolves automatically on the effective date and its members, professionals and agents are released and discharged from further authority and duties; the future claimants' representative is discharged from her duties on the same date, along with her professionals and agents, and her rights, duties and responsibilities pass to the post-effective-date future claimants' representative.
• Both may nonetheless continue in existence, at their option and without approval, with post-effective-date standing and capacity to complete pending unreleased matters including litigation, appeals and negotiations; grant or withhold any consent contemplated or required under the plan in their sole discretion; prosecute or defend professional claims; appeal or oppose appeals of any order in the case, including the confirmation order; litigate motions or actions to enforce or implement the plan or confirmation order; and prepare and prosecute their professionals' fee and expense applications.
• The debtor pays or reserves in the professional claim reserve account the reasonable fees and expenses incurred or projected through the effective date, in accordance with the plan's procedures and the Bankruptcy Code, Rules and any interim or final fee orders; post-effective-date fees and expenses of the committee, the future claimants' representative and their professionals for the surviving purposes are likewise paid from that reserve account. All other reasonable and necessary post-effective-date fees and expenses of professionals retained by the trust advisory committee and the post-effective-date future claimants' representative are paid exclusively by the trust under the trust agreement, and the reorganized debtor bears no liability for them.
• Effective on the committee's dissolution, the trust advisory committee succeeds to and exclusively holds the committee's attorney-client and other privileges and enjoys the work-product protections that were available to the committee; on the future claimants' representative's discharge, the post-effective-date future claimants' representative succeeds in the same way to her privileges and work-product protections.