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IN THE UNITED STATES BANKRUPTCY COURT


FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

In re: § Chapter 11
§
XECHEM, INC. § Case No. 08-30512 (JBS)
and § Case No. 08-30513 JBS)
XECHEM INTERNATIONAL, INC. § (Jointly Administered)
§
Debtors. §
___________________________________

PLAN OF REORGANIZATION FOR THE DEBTORS


PROPOSED BY LAMONTE FORTHUN

LaMonte Forthun, a shareholder of Xechem International, Inc. (“X Int’l”), the owner of
all of the issued and outstanding stock of Xechem, Inc. (“X Inc.”), debtors and debtors-in-
possession herein, hereby proposes the following plan of reorganization pursuant to Section
1121(a) of the Bankruptcy Code for the resolution of each of the Debtors’ outstanding creditor
claims and equity interests. The terms of this Plan shall be applied separately to each of the
Debtors.

ARTICLE I

DEFINITIONS AND CONSTRUCTION OF TERMS

Capitalized terms used herein and not otherwise defined herein have the respective
meanings given in Sections 101 and 102 of the Bankruptcy Code. The following capitalized
terms used herein have the following respective meanings:

1.1 “Administrative Convenience Claim" shall mean any Allowed Unsecured Claim
in the amount of $10,000 or less, or any Allowed Unsecured Claim which the Holder of such
claim elects to reduce to the amount of $10,000.

1.2 “Administrative Expense Claim” means a Claim that is Allowed under Section
503(b) or 1114(c)(2), if any, of the Bankruptcy Code that is entitled to priority under Section
507(a)(1) of the Bankruptcy Code, including, without limitation, (a) any actual and necessary
costs and expenses of preserving the Estates or administering the Chapter 11 Cases as authorized
and approved by a Final Order, (b) any actual and necessary costs and expenses incurred in the
ordinary course of the Debtors’ businesses subsequent to the Petition Date, unless otherwise
determined by a Final Order, (c) “Administrative Claims Bar Date” is defined in Section 10.2
hereof, (d) “Administrative Claims Objection Deadline” is defined in Section 10.2 hereof, (e)
fees and expenses of Professionals Allowed pursuant to a Final Order entered under Sections
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330, 331, or 503 of the Bankruptcy Code, (f) all fees and charges assessed against the Estate
pursuant to 28 U.S.C. § 1930, (g) claims for a Cure payment pursuant to any executory contract
or unexpired lease which is assumed under a Final Order of the Bankruptcy Court; and (h) all
Allowed Claims that are entitled to be treated as Administrative Claims pursuant to a Final Order
of the Bankruptcy Court under Section 546(c)(2)(A) of the Bankruptcy Code.

1.3 “Allowed” means, with reference to any Claim: (a) a Claim that has been listed
by the Debtors in their Schedules and (i) is not listed as disputed, contingent or unliquidated, and
(ii) is not a Claim as to which a proof of claim has been filed; (b) a Claim as to which a timely
proof of Claim has been filed as of the Bar Date and either (i) no objection thereto, or application
to estimate, equitably subordinate or otherwise limit recovery, has been made on or before any
applicable deadline, or (ii) if an objection thereto, or application to estimate, equitably
subordinate or otherwise limit recovery, has been interposed, the extent to which such Claim has
been allowed (whether in whole or in part) by a Final Order; (c) a Claim arising from the
recovery of property under Section 550 or 553 of the Bankruptcy Code and allowed in
accordance with Section 502(h) of the Bankruptcy Code; or (d) any Claim allowed under this
Plan or pursuant to the Confirmation Order.

1.4 "Allowed Class . . . Claim" means an Allowed Claim in the particular class
described.

1.5 “Avoidance Actions” means Causes of Action of the Debtors or the Estates
arising under Sections 502, 510, 541, 544, 545, 547, 548, 549, 550 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 Causes of Action.

1.6 “Ballot” means the form distributed to each holder of an impaired Claim entitled
to vote on the Plan on which an acceptance or rejection of the Plan shall be indicated.

1.7 “Bankruptcy Code” means Title 11 of the United States Code, as amended from
time to time, as applicable to the Chapter 11 Cases.

1.8 “Bankruptcy Court” means the United States Bankruptcy Court for the Northern
District of Illinois, or such other court, having jurisdiction over the Chapter 11 Cases.

1.9 “Bankruptcy Rules” means the Federal Rules of Bankruptcy Procedure as


promulgated under 28 U.S.C. § 2075, and any local rules of the Bankruptcy Court.

1.10 “Bar Date” means the date(s) fixed by order(s) of the Bankruptcy Court by which
Persons asserting a Claim against the Debtors or their property must file a proof of claim or be
forever barred from asserting a Claim against the Debtors or their property and from voting on
the Plan and/or sharing in distributions hereunder. For general pre-petition claims and
governmental unit claims, such date is March 2, 2009.

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1.11 “Business Day” means any day other than a Saturday, Sunday or legal holiday, as
such term is defined in Bankruptcy Rule 9006.

1.12 “Cash” means lawful currency of the United States of America (including
cashier’s checks drawn on a bank insured by the Federal Deposit Insurance Corporation,
certified checks and money orders).

1.13 “Causes of Action” means, without limitation, any and all actions, causes of
action, liabilities, obligations, rights, suits, debts, sums of money, damages, judgments, claims or
proceedings to recover money or property and demands whatsoever, whether known or
unknown, in law, equity or otherwise.

1.14 “Chapter 11 Cases” means the Debtors’ cases under Chapter 11 of the Bankruptcy
Code pending in the Bankruptcy Court.

1.15 “Claim” means a claim against the applicable Debtor or its property as the term
claim is defined in Section 101(5) of the Bankruptcy Code, including, without limitation, (a) any
right to payment, whether or not such right is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, unmatured, disputed, undisputed, legal, equitable, secured or
unsecured; or (b) any right to an equitable remedy for breach of performance if such breach
gives rise to a right to payment, whether or not such right to an equitable remedy is reduced to
judgment, fixed, contingent, matured, unmatured, disputed, undisputed, secured or unsecured.

1.16 “Class” means a category of Holders of Claims or Interests as designated in


Article [5] of this Plan.

1.17 “Collateral” means any property or interest in property of the applicable Debtor’s
Estate subject to a Lien or security interest to secure the payment or performance of a Claim,
which Lien or security interest is not subject to avoidance under the Bankruptcy Code or
otherwise invalid under the Bankruptcy Code or applicable state law.

1.18 “Confirmation" means entry by the Bankruptcy Court of the Confirmation Order.

1.19 “Confirmation Date” means the date on which the Clerk of the Bankruptcy Court
enters the Confirmation Order on the docket in each of the Chapter 11 Cases.

1.20 “Confirmation Hearing” means the hearing to consider confirmation of the Plan
under Section 1128 of the Bankruptcy Code.

1.21 “Confirmation Order” means the order entered by the Bankruptcy Court
confirming the Plan pursuant to the provisions of the Bankruptcy Code with a separate order
being entered in each of the Debtor’s Bankruptcy Case.

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1.22 “Contingent or Unliquidated Claim” means any Claim for which a proof of claim
has been filed with the Bankruptcy Court (a) which was not filed in a sum certain, or which has
not accrued and is dependent upon a future event that has not occurred or may never occur, and
(b) which has not been Allowed.

1.23 "Creditor" means any entity that is the holder of any Claim against the applicable
Debtor that arose on or before the Petition Date or that arose against the applicable Estate on or
before the Effective Date of the Plan, including Claims of a kind specified in Sections 502(g),
502(h), or 502(i) of the Bankruptcy Code.

1.24 “Creditors’ Committee” means the official committee of unsecured creditors


appointed in the X Int’l Chapter 11 Case pursuant to Section 1102 of the Bankruptcy Code.

1.25 “Creditors’ Equity” means the shares of Reorganized Debtor Stock allocated
to Creditors’ Holders of Allowed Claims under this Plan.

1.26 “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(b) 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 bankruptcy law.

1.27 “Debtor” means each of, Xechem International, Inc. and Xechem, Inc., each an
Illinois corporation, debtors and debtors-in-possession herein.

1.28 “Disallowed Claim” means a Claim, or any portion thereof, that (i) has been
disallowed by a Final Order, (ii) is Scheduled at zero or in an unknown amount or as contingent,
disputed or unliquidated and as to which a Bar Date has been established but no Proof of Claim
has been filed or deemed timely filed with the Bankruptcy Court pursuant to either the
Bankruptcy Code or any Final Order or otherwise deemed timely filed under applicable law, or
(iii) is not Scheduled and as to which a Bar Date has been established but no Proof of Claim has
been file by the Bar Date or deemed timely filed with the Bankruptcy Court pursuant to either
the Bankruptcy Code or any Final Order.

1.29 “Disclosure Statement” means the disclosure statement relating to the Plan,
including, without limitation, all exhibits and schedules thereto, in the form approved by the
Bankruptcy Court pursuant to Section 1125 of the Bankruptcy Code.

1.30 “Disputed” means, with respect to Claims, any such Claim: (a) if no proof of
claim relating to such Claim has been filed, that is listed in the Schedules as unliquidated,
disputed or contingent; or (b) if a proof of claim relating to such Claim has been filed, as to
which the Debtor or any other party-in-interest has interposed a timely objection or request for
estimation, or have sought to equitably subordinate or otherwise limit recovery in accordance
with the Bankruptcy Code and the Bankruptcy Rules, or which is otherwise disputed by the

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Debtor or party-in-interest, in accordance with applicable law, which objection, request for
estimation, action to limit recovery or dispute has not been withdrawn or determined by Final
Order; or (c) which is a Contingent or Unliquidated Claim.

1.31 “Disputed Claim Amount” means the amount set forth in the proof of claim
relating to a Claim that is Disputed or an amount estimated pursuant to an order of the
Bankruptcy Court in respect of a Claim that is Disputed in accordance with Section 502(c) of the
Bankruptcy Code and Bankruptcy Rule 3018.

1.32 “Disputed Claim Reserve” means the reserve established and maintained pursuant
to the terms of this Plan and Confirmation Order which, on the Effective Date, shall contain the
amount of Creditors’ Equity or where applicable, Cash or other property estimated for
distribution on the Distribution Date to Holders of (a) Disputed Claims, pending (i) the
allowance or disallowance of such Claims or (ii) the estimation of such claims for purposes of
distribution.

1.33 “Effective Date” means the date which is eleven (11) days after the Confirmation
Date, or if such date is not a Business Day, the next succeeding Business Day; provided,
however, that if, as of such date, all conditions to the occurrence of the Effective Date set forth
in Article [12] of this Plan have not been satisfied or waived pursuant to Article [12] of this Plan,
then the first Business Day on which all such conditions have been satisfied or waived.

1.34 “Equity Interest” shall mean: (a) all issued, unissued, authorized, or outstanding
common or preferred shares of the Debtors; (b) all rights (including unpaid dividends) arising
from common or preferred shares of the Debtors; and (c) all legal, equitable, or contractual rights
of any Person to acquire or receive any common or preferred shares of the Debtors.

1.35 “Estate” means the estate of the applicable Debtor created in the Chapter11 Case
pursuant to Section 541 of the Bankruptcy Code.

1.36 "Executory Contract" means any executory contract or unexpired lease that is
subject to assumption or rejection under Bankruptcy Code Section 365 and that is in effect on
the Confirmation Date between a Debtor and any other Person.

1.37 “Exit Funding” means funds received by the Debtors either through debtor in
possession loans approved under Section 364 of the Bankruptcy Code, equity investments or
otherwise, in an amount not less than $500,000.

1.38 “Final Order” shall mean an order or judgment of the Bankruptcy Court as to
which the time to appeal, petition for certiorari, or move for reargument or rehearing has expired
and as to which no appeal, petition for certiorari, or other proceedings for reargument or
rehearing shall then be pending or as to which any right to appeal, petition for certiorari, reargue,
or rehear shall have been waived in writing in form and substance satisfactory to the Debtors or
the Reorganized Debtors or, in the event that an appeal, writ of certiorari, or reargument or
rehearing thereof has been sought, such order or judgment of the Bankruptcy Court shall have

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been determined by the highest court to which such order was appealed, or certiorari, reargument
or rehearing shall have been denied and the time to take any further appeal, petition for certiorari
or move for reargument or rehearing shall have expired or been waived in writing in form and
substance acceptable to the Plan Proponent; provided, however, that the possibility that a motion
under Rule 59 or Rule 60 of the Federal Rules of Civil Procedure, or any analogous rule under
the Bankruptcy Rules, may be filed with respect to such order shall not cause such order not to
be a Final Order.

1.39 “General Unsecured Claim” means a Claim that is not a Secured Claim,
Administrative Claim, Priority Tax Claim, or Other Priority Claim.

1.40 “Governmental” means of, or relating to, the government of any nation, state or
other political subdivision thereof and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government, and includes the
Bankruptcy Court.

1.41 "Holder" means any entity holding any Claim or any Equity Interest.

1.42 “Impaired” means, when used with reference to a Claim or Interest, a Claim or
Interest that is impaired within the meaning of Section 1124 of the Bankruptcy Code.

1.43 “Indebtedness” means any (i) note, bond, debenture, evidence of indebtedness,
(ii) certificate of interest or participation in any such note, bond, debenture, or evidence of
indebtedness, or (iii) temporary certificate for, or guarantee of, any such note, bond, debenture,
or evidence of indebtedness.

1.44 “Interest” means the rights and interests of the holder of any equity security,
including, without limitation, options or warrants to purchase equity securities, stock
appreciation rights or other rights to purchase or deliver in exchange for equity securities,
including preferred stock, options or warrants to purchase or otherwise acquire the same and any
Claims arising out of the purchase and sales of any such securities.

[1.45 "Intellectual Property" means all intangible property of the Debtors generally
referred to as intellectual property including all patents and licenses.]

[1.46 "Intellectual Property Enforcement Actions" means any litigation to enforce the
Debtors’ rights in Intellectual Property and any licensing or settlement agreements related to the
Debtors’ rights in Intellectual Property.]

1.47 “Lien” has the meaning set forth in Section 101(37) of the Bankruptcy Code;
except that a lien that has been avoided in accordance with Sections 544, 545, 546, 547, 548 or
549 of the Bankruptcy Code shall not constitute a Lien.

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1.48 “Local Rules” means the Local Rules of the United States Bankruptcy Court for
the Northern District of Illinois, Eastern Division.

[1.49 “Management Incentive Plan” means a management incentive plan of up to 5%


of the stock of Xechem International, Inc. on such terms and conditions as the Board of
Directors of reorganized Xechem International, Inc. may approve.]

1.50 “NIPRID” means the National Institute for Pharmaceutical Research and
Development of Nigeria.

1.51 “Net Operating Income” means the cash remaining after payment of operating
expenses, interest, and taxes as certified by the Reorganized Debtors’ outside accountant.

1.52 “Old Xechem International Stock” means the shares of common stock of
Xechem International, Inc. and all options, warrants or rights, contractual or otherwise, if any, to
acquire any such stock, issued and outstanding as of the Record Date.

1.53 "Order" means an order or judgment of the Bankruptcy Court as entered on the
Bankruptcy Court docket.

1.54 “Other Priority Claims” shall mean any and all Claims (or portions thereof), if
any, entitled to priority under Section 507(a) of the Bankruptcy Code other than Priority Tax
Claims and Administrative Expense Claims.

1.55 “Person” means any individual, corporation, partnership, joint venture,


association, joint-stock company, trust, unincorporated association or organization,
governmental agency or political subdivision thereof.

1.56 “Petition Date” means November 9, 2008, the date upon which the Debtors filed
their voluntary Chapter 11 petition with the Bankruptcy Court pursuant to the Bankruptcy Code.

1.57 “Plan” means this Chapter 11 Plan of Reorganization, and all exhibits,
supplements, appendices and schedules hereto and thereto, either in its present form or as the
same may be altered, amended or modified from time to time.

1.58 “Post-Confirmation Committee” means a committee of five Holders of Allowed


Class 2 Claims against X Int’l elected by those Holders of Allowed Class 2 Claims against X
Int’l selected from a panel listed on the applicable Proof of Claim.

1.59 “Priority Tax Claim” means any Claim of a governmental unit entitled to priority
under Section 507(a)(8) of the Bankruptcy Code.

1.60 “Professionals” means those Persons (a) employed pursuant to an order of the
Bankruptcy Court in accordance with Sections 327 or 1103 of the Bankruptcy Code and to be
compensated for services pursuant to Sections 327, 328, 329, 330 and 331 of the Bankruptcy

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Code, or (b) for which compensation and reimbursement has been allowed by the Bankruptcy
Court pursuant to Section 503(b)(4) of the Bankruptcy Code.

1.61 “Professional Fee Claim” means a Claim of a Professional for compensation or


reimbursement of costs and expenses relating to services rendered after the Petition Date and
prior to and including the Effective Date.

1.62 “Proof of Claim” means the proof of claim filed by a Holder of a Claim.

1.63 “Pro Rata” means a proportionate share, so that the ratio of the consideration
distributed on account of an Allowed Claim in a Class to the amount of such Allowed Claim is
the same as the ratio of the amount of the consideration distributed on account of all Allowed
Claims in such Class to the amount of all Allowed Claims in such Class.

1.64 "Record Date" means, with respect to voting on this Plan and with respect to any
right to receive distributions under this Plan, the close of business on the date the Bankruptcy
Court signs an order approving the Disclosure Statement.

1.65 “Reorganized Debtors” means the Debtors after the Effective Date of the Plan.

1.66 "Reorganized Debtor Stock" means 1,000,000,000 shares of common stock to be


issued on the Effective Date in accordance with the terms of this Plan.

[1.67 “Reorganized Debtor Stock Trust” means that certain trust created to hold all of
the authorized and issued common stock of the Debtor and then the Warrants for Reorganized
Debtor Stock issued to Holders of Class 4 Equity Interests allocated to such common stock.]

1.68 “Schedules” means the schedules of assets and liabilities, the list of holders of
interests and the statements of financial affairs filed by the applicable Debtor under Section 521
of the Bankruptcy Code and Bankruptcy Rule 1007, as such schedules, lists and statements have
been or may be supplemented or amended from time to time.

1.69 “Secured Claim” means any Claim, to the extent reflected in the Schedules or a
proof of claim as a Secured Claim, which is secured by a Lien on Collateral to the extent of the
value of such Collateral, as determined in accordance with Section 506(a) of the Bankruptcy
Code, or, in the event that such Claim is subject to setoff under Section 553 of the Bankruptcy
Code, to the extent of such setoff.

1.70 “Unimpaired” means, when used with reference to a Claim or Interest, a Claim or
Interest that is not impaired within the meaning of Section 1124 of the Bankruptcy Code.

1.71 “Unimpaired Claim” means a Claim that is not an Impaired Claim.

1.72 “Unsecured Claim” means a Claim that is not a Secured Claim or that is not
entitled to priority of payment under Section 507 of the Bankruptcy Code.

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1.74 Interpretation; Application of Definitions and Rules of Construction. Wherever


from the context it appears appropriate, each term stated shall include both the singular and the
plural, and pronouns shall include the masculine, feminine and neuter, regardless of how stated.
Unless otherwise specified, all section, article, schedule or exhibit references in the Plan are to
the respective section in, article of, schedule to, or exhibit to, the Plan. The words “herein,”
“‘hereof,” “hereto,” “hereunder” and other words of similar import refer to the Plan as a whole
and not to any particular section, sub-section or clause contained in the Plan. Any reference in
the Plan to a contract, instrument, release, indenture, or other agreement or documents being in a
particular form or on particular terms and conditions means that such document shall be
substantially in such form or substantially on such terms and conditions. Captions and headings
to articles and sections are inserted for convenience of reference only and are not intended to be
a part of or to affect the interpretation of the Plan. The rules of construction contained in Section
102 of the Bankruptcy Code shall apply to the construction hereof. The headings in the Plan are
for convenience of reference only and shall not limit or otherwise affect the provisions hereof.

1.75 “Computation of Time” In computing any period of time prescribed or allowed by


the Plan, the provisions of Bankruptcy Rule 9006(a) shall apply.

1.76 “Governing Law” Unless a rule of law or procedure is supplied by federal law
(including the Bankruptcy Code and Bankruptcy Rules), the laws of the State of Illinois shall
govern the construction and implementation of the Plan and any agreements, documents, and
instruments executed in connection with the Plan.

ARTICLE II

CLASSIFICATION OF CLAIMS AND EQUITY INTERESTS

2.1 “Unclassified Claims” In accordance with Section 1123(a)(1) of the Bankruptcy


Code, Administrative Claims, Priority Tax Claims and Other Priority Claims have not been
classified, and the respective treatment of such unclassified claims is set forth immediately
below.

2.2 Administrative Expense Claims - General: Each Holder of an Allowed


Administrative Expense Claim shall be paid in full in Cash by the applicable Reorganized
Debtor, on the later of: (a) the Effective Date of the Plan; or (b) the date such Claim is Allowed
by a Final Order, unless the Holder of such Claim consents to other treatment; provided,
however, that such Allowed Claims, representing liabilities incurred in the ordinary course of
business by the applicable Debtor shall be paid in accordance with the terms and provisions of
the particular transactions and any agreements relating thereto.

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2.3 Administrative Expense Claims - Professional Compensation and Expense


Reimbursement Claims: All Professionals seeking an award by the Bankruptcy Court of
professional fees, or of compensation for services rendered or reimbursement of expenses
incurred through and including the Confirmation Date under Sections 503(b)(2), 503(b)(3),
503(b)(4) or 503(b)(5) of the Bankruptcy Code, (a) shall file their respective final applications
for allowances of compensation for services rendered and reimbursement of expenses incurred
through the Confirmation Date within thirty (30) days after the Confirmation Date, and (b) if
granted such an award by the Bankruptcy Court, shall be paid in full in such amounts as are
allowed by the Bankruptcy Court (i) on the later of the Effective Date or the date such
Administrative Expense Claim becomes an Allowed Administrative Expense Claim, or as soon
thereafter as is practicable or (ii) upon such other terms as may be mutually agreed upon
between such holder of an Allowed Administrative Expense Claim and applicable Debtor. All
professional fees for services rendered in connection with the Plan after the Confirmation Date
shall be paid by the applicable Reorganized Debtor without the need for further Bankruptcy
Court authorization or entry of a Final Order.

2.4 Priority Tax Claims. Allowed Priority Tax Claims may be paid in Cash by the
applicable Debtor at its election either (a) in full on the Effective Date; or (b) over a period not
exceeding six (6) years after the date of assessment of the Claims in accordance with the
following schedule: (i) each Allowed Priority Tax Claim shall bear interest from and after the
Effective Date of the Plan at the rate assessed on unpaid taxes by the Department of Treasury;
(ii) on the last day of each of March, June, September and December of each after the Effective
Date of the Plan commencing with March 31, 2010, the Holder of such Allowed Priority Tax
Claim will be paid the interest that has accrued on such Claim during the prior full quarter plus
1/24th of the principal amount of such Claim until such Claim has been paid in full; and (iii) the
entire principal amount of such Claim and all interest accrued thereon shall be paid in full on the
date that is six (6) years after the date of assessment of such Claim; provided, however, that the
Holder of such Claim and the applicable Debtor may consent to other treatment.

2.5 Other Priority Claims. Each Holder of an Allowed Claim entitled to priority in
accordance with Section 507(a)(1) of the Bankruptcy Code that is not an Administrative Expense
Claim shall be paid in full in Cash by the applicable Reorganized Debtor, on the later of: (a) the
Effective Date of the Plan; or (b) the date such Claim is Allowed by a Final Order, unless the
Holder of such Claim consents to other treatment; provided, however, that such Allowed Claims
representing liabilities incurred in the ordinary course of business by the applicable Debtor shall
be paid in accordance with the terms and provisions of the particular transactions and any
agreements relating thereto.

2.6 Classification of Claims and Interests. For purposes of this Plan, Claims
against, and Equity Interests in, the applicable Debtor, other than Administrative Expense
Claims, Priority Tax Claims and other Priority Claims, are classified as described below. A
Claim or Equity Interest will be deemed classified in a particular Class only to the extent that
such Claim or Equity Interest qualifies within the description of that Class and will be

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deemed classified in a different Class to the extent that any remainder of such Claim or Equity
Interest qualifies within the description of such different Class. The classification of Claims
against and Interests in the Debtors pursuant to this Plan is as follows:

Class Status Voting Rights

CLASS-1 Secured Claims Unimpaired Not entitled to vote

CLASS-2 Note Holder Claims Impaired Entitled to Vote

CLASS-3 Trade Claims Impaired Entitled to Vote

CLASS-4 Administrative Convenience Impaired Entitled to Vote

CLASS-5 Equity Interests Impaired Deemed to Reject

ARTICLE III

TREATMENT OF CLAIMS

3.1 Unimpaired Classes. Class 1 (Secured Claims) is unimpaired and the Holders of
Claims in such class are deemed to have accepted the Plan. Plan proponent does not know of
any Claims which exist in this Class 1, but should more than one such Claim become an Allowed
Claim, then this Class 1 shall be divided into sub-classes with each such Allowed Claim being
the sole member of a sub-class.

3.1(a) Class 1 - Secured Claims. On the Effective Date of the Plan, except as
otherwise agreed between the Debtor and any Holder of an Allowed Class 1 Claim, the Debtor
shall, at Debtor's option, either (i) deliver possession to the Holder of an Allowed Class 1 Claim
all property securing such Claim, or (ii) cure any default (other than a default of a kind specified
in Section 365(b)(2) of the Bankruptcy Code) that occurred before or after the Petition Date, the
occurrence of which entitles a Holder of an Allowed Class 1 Claim pursuant to any contractual
provision or applicable law to demand or receive accelerated payment of such Claim, and the
maturity of such Claim shall be reinstated as such maturity existed before such default.
Payments by the Debtor necessary to cure any such defaults shall, upon the agreement of the
Holder of an Allowed Class 1 Claim and the Debtor, be made in Cash. This Plan shall not
otherwise alter the legal, equitable or contractual rights held by the Holder of an Allowed Class 1
Claim.

3.2 Impaired Classes. Classes 2, 3, 4 and 5 are impaired and Holders of Claims in
Class 2, 3 and 4 are entitled to vote to accept or reject the Plan.

3.2(a) Class 2 - Note Holders. On the Effective Date of the Plan, the Debtor
shall issue to each Holder of a Class 2 General Unsecured Claim (a) a promissory note in the
principal amount of 100% of such Holder’s Allowed Class 2 Claim and which bears simple

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interest at 6% per annum and is payable in Cash in annual installments commencing on March
31, 2012, and each March 31 thereafter until March 31, 2019, such payments to be in the
amount of 50% of Reorganized Debtor’s Net Operating Income for the prior year as certified by
the Debtor’s outside accountant. The Holders of Allowed Class 2 Claims against X Int’l shall
also receive their pro rata share of 5% of the Reorganized Debtor Stock. The distributions made
to the Holders of Allowed Class 2 Claims shall be made in full and final satisfaction of all
Claims held by such Holders.

3.2(b) Class 3 - Trade Creditors Unsecured Claims. On the Effective Date of the
Plan, the Debtor shall issue to each Holder of a Class 3 General Unsecured Claim (a) a
promissory note in the principal amount of 100% of such Holder’s Allowed Class 3 Claim and
which bears simple interest at 6% per annum and is payable in Cash in annual installments
commencing on March 31, 2011, and each March 31 thereafter until March 31, 2018 such
payments to be an amount equal to one-sixth of the principal amount of such Holder’s claim plus
interest accrued thereon in the prior year. The distributions made to the Holders of Allowed
Class 2(a) Claims shall be made in full and final satisfaction of all Claims held by such Holders.

3.2(c) Class 4 - Administrative Convenience Claims. The Holders of Allowed


Class 4 Claims shall be paid in cash on the Effective Date of the Plan, $0.50 for each $1.00 of
Allowed Claim held by such Holder in full and final satisfaction of all Claims of such Holder. If
the aggregate amount of Allowed Class 2(b) Administrative Convenience Claims exceeds
$100,000, then the Debtor may elect to either (a) still pay each Holder $0.50 for each $1.00 of
Allowed Claim held by such Holder in full and final satisfaction of all Claims of such Holder; or
(b) cancel Class 4 in which case each Holder will be treated under Class 3.

3.2(d) Class 5 - Equity Interests. The Holders of Allowed Class 5 Equity


Interests in X Int’l shall have their Equity Interest cancelled. The Plan Proponent shall, from the
equity he shall receive on account of his capital contribution under this Plan, provide for the
Holders of Allowed Class 5 Equity Interests in X Int’l to receive their pro rata share of 10% of
the Reorganized Debtor Stock. X Int’l, as the sole Holder of Allowed Class 5 Equity Interest in
X Inc., shall retain its Equity Interest in X, Inc.

3.3 Reservation of Rights Regarding Claims. Except as otherwise explicitly provided


in the Plan, nothing shall affect the Debtors’, or the Creditors’ Committee’s, rights and defenses,
both legal and equitable, with respect to any Claims, including, but not limited to, all rights with
respect to legal and equitable defenses to alleged rights of setoff or recoupment.

ARTICLE IV

ACCEPTANCE OR REJECTION OF THE PLAN

4.1 Summary of Classes Voting on the Plan. As a result of the provisions of this
Plan, so long as such Claims are not Disputed Claims on or before 10 days before the voting
deadline or have not been previously Disallowed by a Final Order, the Holders of Claims in
Classes 2,3, and 4 will be entitled to vote and the votes of the Holders of such Claims will be

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solicited with respect to this Plan; provided, however, that objections may be filed to Claims in
accordance with the Plan for the purpose of voting and/or motions may be filed to estimate
Claims for the purpose of voting. The Holders of Claims in Class 1are deemed by operation of
law to have accepted the Plan, and the Holders of such claims are not entitled to vote to accept or
reject the Plan. The Holders of Claims in Class 5 are deemed by operation of law to have
rejected the Plan, and the Holders of such claims are not entitled to vote to accept or reject the
Plan.

4.2 Confirmation Pursuant to Section 1129(b) of the Bankruptcy Code. To the extent
that any Impaired Class rejects the Plan or is deemed to have rejected the Plan, the Creditors’
Committee will request confirmation of the Plan under Section 1129(b) of the Bankruptcy Code.

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ARTICLE V

EXECUTION OF PLAN

5.1 Plan Funding

5.1(a) Cash. The Reorganized Debtor shall have the right to use its Cash in the
operation of its business and to fund payments under this Plan and for working capital.

5.1(b) New Capital. New capital shall be funded into the Reorganized Debtors in
an amount sufficient to pay allowed Cure Costs and Allowed Administrative Claims and
Allowed Priority Claims as provided in this Plan and to provide working capital for the
Reorganized Debtors and their subsidiaries in such amounts and on such terms and conditions as
determined by the Plan Proponent in the exercise of his reasonable discretion.

5.2 Equity Interests

5.2(a) Issuance of Reorganized Debtor Stock. On the Effective Date, X Int’l


shall issue the Reorganized Debtor Stock as follows: (a) 85% to the Plan Proponent or his
nominee; (b) 5% to Holders of Allowed Class 2 Claims; and (c) 10% to the Holders of Allowed
Class 5 Equity Interests in X Int’l.

5.2(b) Cancellation of Old Xechem International Stock and Indebtedness. On


the Effective Date, all Old Xechem International Stock and any other notes, bonds, indentures or
other instruments or documents evidencing or creating any Indebtedness or obligations of, or
interests in, X Int’l, except such notes or other instruments evidencing indebtedness or
obligations of X Int’l that are unimpaired, reinstated, or amended and restated under this Plan,
shall be cancelled, and the obligations of X Int’l under any agreement, indentures or certificates
of designation governing the Old Xechem International Stock, and any other notes, bonds,
indentures or other instruments or documents evidencing or creating any indebtedness or
obligations of, or interest in, X Int’l, except such notes or other instruments evidencing
Indebtedness or obligations of X Int’l that are unimpaired, reinstated or amended and reinstated
under this Plan, as the case may be, shall be discharged.

5.2(c) Cancellation of X Inc. Indebtedness. On the Effective Date, all notes,


bonds, indentures or other instruments or documents evidencing or creating any Indebtedness or
obligations of, or interests in, X Inc., except such notes or other instruments evidencing
indebtedness or obligations of X Inc. that are unimpaired, reinstated, or amended and restated
under this Plan, shall be cancelled, and the obligations of X Inc. under such agreement,
indentures or certificates of designation and any other notes, bonds, indentures or other
instruments or documents evidencing or creating any indebtedness or obligations of, or interest
in, X Inc., except such notes or other instruments evidencing Indebtedness or obligations of X
Inc. that are unimpaired, reinstated or amended and reinstated under this Plan, as the case may
be, shall be discharged.

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5.2(d) Intercompany Obligations. [Any intercompany balances with non-debtor


subsidiaries as of the Effective Date are hereby subordinated as of the Effective Date to all
distributions and claims under the Plan and may, at the sole discretion of Reorganized Debtors,
be forgiven or contributed to capital in whole or in part or otherwise treated if the Reorganized
Debtors so elect.]

5.3 Vesting of Assets and Reorganization. Except as expressly provided


elsewhere in this Plan, on the Effective Date, the property of the Debtor’s Estate shall vest in the
Reorganized Debtor, including all of the Debtor’s claims, rights and Causes of Action (including
Avoidance Actions) and any property acquired by Debtors or Reorganized Debtors under or in
connection with this Plan, free and clear of all Claims, Liens, charges, other encumbrances and
Interests other than (i) those Liens, Claims and Interests retained or created pursuant to this Plan
and (ii) Liens that have arisen subsequent to the Petition Date on account of taxes that arose
subsequent to the Petition Date. On and after the Effective Date, the Reorganized Debtors may
operate their business and may use, acquire and dispose of property and compromise or settle
any Claims without supervision of or approval by the Bankruptcy Court and free and clear of any
restrictions of the Bankruptcy Code or the Bankruptcy Rules, other than restrictions expressly
imposed by this Plan or the Confirmation Order. Following the Effective Date, Reorganized
Debtors will engage in any business appropriate under their organizational documents.

5.4 Distribution of Property Under this Plan.

5.4(a) Distributions. The Reorganized Debtors shall each make distributions


required of them under this Plan on the Distribution Date. As to any Disputed Claim or
subsequently allowed Administrative Expense, the affected Reorganized Debtors shall pay such
claim within five (5) Business Days of the order allowing such Claim or such Administrative
Expense becomes a Final Order.

5.4(b) No Interest on Claims. Unless otherwise specifically provided for in this


Plan or the Confirmation Order, or required by applicable bankruptcy law, post-petition interest
shall not accrue or be paid on Claims, and no holder of a Claim shall be entitled to interest
accruing on or after the Petition Date on any Claim. Unless such Claim is a Secured Claim
entitled to post-petition interest pursuant to Section 506 of the Bankruptcy Code, interest shall
not accrue or be paid upon any Disputed Claim with respect to the period from the Petition Date
to the date a Final Distribution is made thereon, if and after such Disputed Claim becomes an
Allowed Claim.

5.4(c) Manner of Payment Under this Plan. The Cash distributions made
pursuant to this Plan shall be in U.S. dollars by checks drawn on domestic banks selected by the
Reorganized Debtors, or by wire transfer from a domestic bank selected at the applicable
Reorganized Debtors’ option. The Reorganized Debtor Stock shall be distributed via physical
certificates.

5.4(d) Delivery of Distributions and Undeliverable or Unclaimed Distributions.

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5.4(d)(i) Delivery of Distributions In General. Distributions to holders of


Allowed Claims shall be distributed by mail as follows: (A) at the addresses set forth on the
respective proofs of claim filed by such Holders; (B) at the addresses set forth in any written
notices of address changes delivered to the Reorganized Debtors after the date of any related
proof of claim; or (C) at the address reflected on the Debtors’ Schedules if no proof of claim is
filed and the Reorganized Debtors have not received a written notice of a change of address. All
notices of change of address under sub-sections (B) and (C) above shall, to be effective, be
delivered to the Reorganized Debtors.

5.4(d)(ii) Undeliverable Distributions.

5.4(d)(ii)(A) Holding of Undeliverable Property. If the distribution to the


Holder of any Claim is returned to a Reorganized Debtor as undeliverable, no further distribution
shall be made to such Holder unless and until the Reorganized Debtor is notified in writing of
such Holder's then current address. Except as provided herein below, undeliverable distributions
shall remain in the possession of the Reorganized Debtor until such time as a distribution
becomes deliverable.

5.4(d)(ii)(B) Failure to Claim Undeliverable Property. Any Holder of an


Allowed Claim who does not assert a claim for an undeliverable distribution held by the
Reorganized Debtors within 90 days after date such distribution was required to be made under
this Plan shall no longer have any Claim to or in such undeliverable distribution, and shall be
forever barred from receiving any future distributions under this Plan. In such cases, any
property held for distribution on account of such Claims shall be retained by the Reorganized
Debtors free from any restrictions thereon. Nothing contained in this Plan shall require the
Debtors or the Reorganized Debtors to attempt to locate any Holder of an Allowed Claim.

5.4(e) Compliance With Tax Requirements. In connection with this Plan, to


the extent applicable, the Reorganized Debtors shall comply with all withholding and reporting
requirements imposed on them by any governmental unit, and all distributions pursuant to this
Plan shall be subject to such withholding and reporting requirements. Notwithstanding any other
provision of the Plan: (a) each Holder of an Allowed Claim that is to receive a distribution
pursuant to the Plan shall have sole and exclusive responsibility for the satisfaction and payment
of any tax obligations imposed by any governmental unit, including income, withholding and
other tax obligations, on account of such distribution, and (b) no distribution shall be made to or
on behalf of such Holder pursuant to the Plan unless and until such Holder has made
arrangements satisfactory to the Reorganized Debtors for the payment and satisfaction of such
tax obligations. The Reorganized Debtors shall be responsible for forwarding an Internal
Revenue Service Form W-9 (or for foreign creditors, Form W-8BEN) to all Holders of Claims
under the Plan to the extent this is not done as part of the plan solicitation package. The
Reorganized Debtors shall only make a distribution to a Claimant upon receipt of an executed
W-9 form (or for foreign creditors, Form W-8BEN), which specifies Holder’s Federal Tax
Identification Number, Social Security Number or other tax identification information, unless the
Reorganized Debtors are already in possession of the Holder’s Federal Tax Identification
Number, Social Security Number or other tax identification information.

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5.4(f) Setoffs. The Debtors or the Reorganized Debtors may, but shall not be
required to, set off against any Allowed Claim claims of any nature that the Debtors or the
Reorganized Debtors may have against the Holder of such Allowed Claim; provided, however,
that neither the failure to effect such a setoff nor the allowance of any Claim against the Debtors

or the Reorganized Debtors shall constitute a waiver or release by the Debtors or the
Reorganized Debtors of any claim that the Debtor or the Reorganized Debtor may possess
against such Holder.

5.4(g) Time of Payments. All payments under this Plan shall be made on
March 31 of each year until all Plan payments are made in full, except for those payments which
are specifically required to be made on the Effective Date.

5.5 Obligations and Rights of the Reorganized Debtor.

5.5(a) Each Reorganized Debtor shall administer its respective business and
property from and after the Effective Date of the Plan.

5.5(b) Except as otherwise provided herein, on the Effective Date of the Plan
all assets of each Debtors’ estate shall vest in the respective Reorganized Debtor free and clear
of all liens, Claims and Equity Interests, but subject to rights of Holders of Allowed Claims and
Allowed Equity Interests to obtain distributions provided in this Plan.

5.5(c) Each Reorganized Debtor shall be responsible for making the


distributions of Cash in accordance with the Plan.

5.5 (d) Each Reorganized Debtor shall have the exclusive power, on behalf of
and in the name of the Debtor, to prosecute, defend, compromise, settle or otherwise deal with
all Avoidance Actions without further order of the Bankruptcy Court.

5.5(e) Each Reorganized Debtor may retain such personnel or professionals


as it deems appropriate, and compensate such professionals without prior approval of the
Bankruptcy Court. Professionals so retained need not be "disinterested" as that term is defined
in the Bankruptcy Code.

5.5(f) Each Reorganized Debtor shall have the power and authority to
receive, collect, deposit, and distribute any funds in accordance with this Plan.

5.5(g) Each Reorganized Debtor shall have all power and authority to seek a
tax opinion or ruling from any local, state, or federal tax authority, or from the Bankruptcy Court
pursuant to Section 1146(e) of the Code.

5.5(h) Except to the extent Allowed hereunder, each Reorganized Debtor


shall have all power and authority to (i) object to any Claim; (ii) seek estimation or disallowance
of any Claim, or (c) compromise or settle any Claim upon application to the Bankruptcy Court or

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without such application if it is determined by a court of competent jurisdiction that no such


application to the Bankruptcy Court is required.

5.5(i) Each Reorganized Debtor shall have the power and right to appear in,
defend, or otherwise be heard as a party in interest in (i) appeals from the Confirmation Order
and any proceedings related thereto; and (ii) proceedings related to the enforcement or
interpretation of the Plan.

5.5(j) Each Reorganized Debtor shall establish an account and make a


deposit in accordance with Bankruptcy Rule 3020 prior to entry of the Confirmation Order. The
funds deposited shall be in an amount sufficient to make the payments that will become due on
the Effective Date under the Plan.

5.6 Cancellation of X Int’l Existing Common Stock and Issuance of Reorganized


Debtor Stock. On the Effective Date of the Plan, all Equity Interests in X Int’l shall be
cancelled. On the Effective Date, X Int’l shall issue the Reorganized Debtor Stock.

5.7 Issuance of Securities. The issuance of the Reorganized Debtor Stock by X Int’l
and the distribution by X Int’l of such pursuant to this Plan qualifies for the exemption from
securities laws set forth in Section 1145 of the Bankruptcy Code.

5.8 No Liability for Solicitation or Participation. As specified in Section 1125(e) of


the Bankruptcy Code, Persons that solicit acceptances or rejections of this Plan and/or that
participate in the offer, issuance, sale, or purchase of securities offered or sold under this Plan, in
good faith and in compliance with the applicable provisions of the Bankruptcy Code, are not
liable, on account of such solicitation or participation, for violation of any applicable law, rule,
or regulation governing the solicitation of acceptances or rejections of this Plan or the offer,
issuance, sale, or purchase of securities.

5.9 Objections to Claims. Objections to Claims, including Administrative Expense


Claims, shall be filed with the Bankruptcy Court and served upon the Holder of such Claim
within such time as may be fixed by the Bankruptcy Court.

5.10 Cancellation of Notes and Instruments. On the Effective Date of the Plan, the
respective rights and obligations of the Debtors and each Holder of a Claim or an Equity Interest
shall be terminated and canceled except as to a right to receive a distribution under this Plan.

5.11 Other Documents and Actions. The Debtors and the Reorganized Debtors may
execute such documents and take such other action as is necessary to effectuate the transactions
provided for in this Plan.

5.12 Creditors’ Remedies After Confirmation of Plan. After the Plan is confirmed,
each Debtor will have the responsibility of complying with all of the provisions of the confirmed
Plan applicable to such Debtor. If the Debtor does not comply with the terms of the Plan, any
aggrieved creditor who wishes to enforce its rights under the Plan must file a motion with the

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Bankruptcy Court for whatever relief is appropriate.

5.13 Attorney Client Privilege. Any attorney-client privilege, work-product privilege


or other privilege or immunity that the Estates are entitled to assert shall vest in the Debtor who
shall be entitled to assert such privilege and immunity to the extent that such Debtor was entitled
to do so prior to the Effective Date.

ARTICLE VI

EXECUTORY CONTRACTS, UNEXPIRED LEASES


DISPUTED CLAIMS AND EMPLOYEE BENEFIT PLANS

6.1 Executory Contracts and Unexpired Leases. All executory contracts and
unexpired leases shall be deemed rejected by the Debtors unless: (a) expressly assumed by a
Debtor with Bankruptcy Court approval on or before the Effective Date of the Plan; (b) subject
to a motion to assume pending on the Effective Date of the Plan; or (c) identified on a list to be
filed with the Bankruptcy Court, on or before the Effective Date of the Plan, as to be assumed;
provided, however, that in the event that after the Confirmation Date, a party to an alleged
executory contract or unexpired lease of a Debtor contends that such contract or lease was
deemed rejected by operation of this Section 6.1, the Debtors (i) shall have the right to dispute
such contention and to seek a Bankruptcy Court order regarding whether such contract or lease
was executory or unexpired and (ii) shall have the right to assume such lease or contract if it is
determined by the Bankruptcy Court that such contract or lease is executory or unexpired. If an
executory contract or unexpired lease is rejected, the other party to the agreement may file a
proof of claim with respect to a Claim for damages by reason of the rejection. Any proof of
claim with respect to Claims under an executory contract or unexpired lease that has been
rejected must be filed with the Bankruptcy Court within 30 days after the rejection by a Debtor
of such contract or lease. A Claim under an executory contract or unexpired lease which has
been rejected shall constitute a Class 3 Claim to the extent it is allowed by the Bankruptcy Court.
To the extent that the Debtor is a party to any executory contract that is deemed an illegal
contract, such illegal contract shall be deemed rejected as of the Confirmation Date, and the
other party to such contract shall not be entitled to any Claim arising therefrom against a Debtor
or a Reorganized Debtor.

6.2 Rejection Damages Bar Date. If the rejection by a Debtor, pursuant


to the Plan, of an executory contract or unexpired lease results in a Claim, then such Claim shall
be forever barred and shall not be enforceable against a Debtor or Reorganized Debtor or the
properties of either of them, except that there shall be a Class 3 Claim under this Plan to the
extent that a Proof of Claim is filed on or before thirty (30) days after the Confirmation Date.

6.3 Disputed Claims. Except as allowed hereunder, a Debtor or a Reorganized


Debtor or the Plan Proponent, the Committee, or the Post-Confirmation Committee may object
to the allowance of Claims filed with the Bankruptcy Court. Objections will be litigated to a
Final Order; however, the Debtor or the Reorganized Debtor against whom such Claim is
assessed may compromise and settle any objections to Claims, subject to the approval of the

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Plan Proponent and the Bankruptcy Court, and may seek Bankruptcy Court estimation of

Disputed Claims pursuant to Section 502(c) of the Bankruptcy Code, which Section permits
estimation of any contingent or unliquidated claim, the fixing or liquidation of which would
unduly delay the administration of the Chapter 11 Cases.

6.4 Compensation and Benefit Programs. By this Plan, each Debtor rejects its
employee benefit plan and program. On and after the Effective Date of the Plan, pursuant to
Section 1129(a)(13) of the Bankruptcy Code, the Reorganized Debtors will continue to pay any
retiree benefits, as that term is defined in Section 1114 of the Bankruptcy Code, at the level
established pursuant to subsection (e)(1) or (g) of Section 1114 of the Bankruptcy Code, at any
time prior to confirmation of this Plan, for the duration of the period each Debtor has obligated
itself to provide such benefits. The Debtors do not believe that they are obligated to pay any
retiree benefits.

ARTICLE VII

DISCHARGE AND INJUNCTION

7.1 Discharge. The distributions made pursuant to and in accordance with the
applicable terms and conditions of the Plan are in full and final satisfaction, settlement, release
and discharge as against the Debtors of any debt of the Debtors that arose before the Effective
Date, and any debt of the Debtors of a kind specified in Section 502(g), 502(h), or 502(i) of the
Bankruptcy Code, and all Claims against the Debtors of any nature, including, without
limitation, any interest accrued thereon from and after the Petition Date, whether or not (i) a
proof of Claim based on such debt, obligation or equity interest is filed or deemed filed under
Section 501 of the Bankruptcy Code, (ii) such Claim is Allowed under Section 502 of the
Bankruptcy Code or (iii) the holder of such Claim has accepted the Plan.

7.2 Discharge. Except as specifically provided in the Plan to the contrary, the
treatment of Allowed Claims and Interests, distributions and rights that are provided in the Plan
shall be in complete, full and final settlement, satisfaction, and discharge of, and shall void and
extinguish all Claims against, liens on and Interests in the Debtors or the Reorganized Debtors,
or the assets and properties of the Debtors or the Reorganized Debtors. This Plan constitutes a
discharge under Section 1141 of the Bankruptcy Code.

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ARTICLE VIII

PROVISIONS FOR TREATMENT OF DISPUTED,


CONTINGENT AND UNLIQUIDATED ADMINISTRATIVE
EXPENSE CLAIMS AND OTHER CLAIMS

8.1 Disputed Administrative Expense Claims and Claims Resolution.

8.1(a) Claims Objections: Unless otherwise ordered by the Bankruptcy Court


after notice and a hearing, a Debtor or Reorganized Debtor, the Plan Proponent, the Committee,
or the Post-Confirmation Committee, shall have the right to make and file objections to
Administrative Expense Claims and other Claims and shall serve a copy of each objection upon
the Holder of the Disputed Administrative Expense Claim or Disputed Claim to which the
objection is made.

8.1 (b) Distributions Held: Notwithstanding any other provisions of this Plan, no
payments or distributions shall be made on account of any Disputed Claim until such Claim
becomes an Allowed Claim, and then only to the extent that it becomes an Allowed Claim. All
distributions on account of Disputed Claims shall be held by the Reorganized Debtor pending
resolution of such dispute.

8.1(c) Distributions on Account of Disputed Claims Once Allowed and


Additional Distributions on Account of Previously Allowed Claims. At such time as all or any
portion of a Disputed Claim becomes an Allowed Claim or a Claim or Administrative Expense
otherwise reserved for becomes due and payable, the distributions reserved for such Disputed
Claim or Administrative Expense or such portion (including interest earned thereon or property
distributed on account thereof) shall be released from the appropriate reserve and paid or
distributed, as the case may be, by a Reorganized Debtor on the Distribution Date or Final
Distribution Date, to the Holder of such Allowed Claim or Administrative Expense, net of any
taxes or other applicable charges required to be paid by a Reorganized Debtor in respect thereof.
At such time as all or any portion of a Disputed Claim is determined by the Bankruptcy Court
not to be an Allowed Claim or an Administrative Expense is not ultimately Allowed by the
Bankruptcy Court, the Distribution reserved for such Disputed Claim or Administrative Expense
or such portion (including such interest and dividend thereon or property distributed on account
thereof) shall be released from the appropriate Reserve Account and shall be held by the
Reorganized Debtors for distribution.

8.1(d) No Waiver or Release: Nothing in this Plan, the Confirmation Order or any
order in aid of confirmation of this Plan shall constitute, or be deemed to constitute, a waiver or
release of any claim, cause of action, right of setoff, or other legal or equitable defense which the
Debtors had prior to the Petition Date, against or with respect to any Claim or Equity Interest.
During the pendency of the Chapter 11 Case and upon Confirmation of this Plan, the Debtors,
the Reorganized Debtors, the Plan Proponent, the Committee and the Post-Confirmation
Committee shall have, retain, reserve and be entitled to assert all such claims, causes of action,
rights of setoff and other legal or equitable defenses which the applicable Debtor had prior to the

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Petition Date as if the Chapter 11 Cases had not been commenced. All of the applicable
Debtors’ legal and equitable rights respecting any Claim or Equity Interest may be asserted after
the Confirmation Date to the same extent as if the Chapter 11 Case had not been commenced.

8.2 Resolution of Contingent Claims and Unliquidated Claims. The Debtors, the
Reorganized Debtors, the Plan Proponent, the Committee and the Post-Confirmation Committee
shall have the right to make and file motions to estimate contingent Claims and unliquidated
Claims and shall serve a copy of each objection upon the Holder of the such Claims to which the
estimation is sought. The applicable Debtor or the applicable Reorganized Debtor shall further
have the right to compromise such claims. Notwithstanding any other provisions of this Plan, no

payments or distributions shall be made on account of any contingent Claim or unliquidated


Claim until such Claim becomes an Allowed Claim, and then only to the extent that it becomes
an Allowed Claim.

8.3 Preservation of Rights of Action. Except as otherwise provided in this Plan, prior
order of the Bankruptcy Court or the Confirmation Order, or in any contract, instrument, release,
indenture or other agreement entered into in connection with the Plan, in accordance with
Section 1123(b) of the Bankruptcy Code, the Reorganized Debtors, the Plan Proponent and the
Post-Confirmation Committee shall retain and may enforce, sue on, settle, or compromise (or
decline to do any of the foregoing) all Causes of Action or warranty, indemnity, credits, rebates,
discounts or similar claims that the Debtors or the Estates may hold against any Entity.

ARTICLE IX

ACCEPTANCE OR REJECTION OF THIS PLAN

9.1 Voting by Impaired Classes. Classes 2, 3 and 4 are impaired as such term is
defined in Section 1124 of the Bankruptcy Code. Each Holder of a Claim in Classes 2, 3 and 4
as of the Record Date is entitled to vote either to accept or to reject this Plan. Only those votes
cast by Holders of Allowed Claims and received in accordance with the provisions of the
Disclosure Statement and any order of the Bankruptcy Court establishing voting procedures shall
be counted in determining whether acceptances have been received sufficient in number and
amount to confirm this Plan.

9.2 Acceptance by Impaired Classes. Classes 2, 3 and 4 shall have accepted this Plan
if: (a) the Holders (other than any Holder designated under Section 1126(e) of the Bankruptcy
Code) of at least two-thirds in dollar amount of the Allowed Claims actually voting in such Class
have voted to accept this Plan; and (b) the holders (other than any holder designated under
Section 1126(e) of the Bankruptcy Code) of more than one-half in number of the Allowed
Claims actually voting in such Class have voted to accept this Plan.

9.3 Presumed Acceptance of Plan. Class 1 is unimpaired as such term is defined by


reference to Section 1124 of the Bankruptcy Code under this Plan and, therefore, is conclusively
presumed to have accepted this Plan pursuant to Section 1126(f) of the Bankruptcy Code.

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9.3 Presumed Rejection of Plan. Class 5 is receives no distribution from a Debtor


and, therefore, is conclusively presumed to have accepted this Plan pursuant to Section 1126(f)
of the Bankruptcy Code.

9.4 Nonconsensual Confirmation. If any impaired Class entitled to vote shall not
accept the Plan by the requisite statutory majorities provided in Sections 1126(c) or 1126(d) of
the Bankruptcy Code, as applicable, or if any impaired class is deemed to have rejected the Plan,
the Debtor reserves the right (a) to undertake to have the Bankruptcy Court confirm the Plan
under Section 1129(b) of the Bankruptcy Code and (b) to amend the Plan to the extent necessary
to obtain entry of the Confirmation Order.

ARTICLE X

CONDITIONS PRECEDENT

10.1 Conditions Precedent to the Confirmation Date. Each of the following shall be a
condition precedent to the Confirmation Date of this Plan:

10.1(a) The Confirmation Order shall approve in all respects all of the
provisions, terms and conditions of this Plan;

10.1(b) The Confirmation Order and the Plan shall be in form and substance
satisfactory to the Plan Proponent in his sole discretion; and

10.1(c) the Estates shall have sufficient Cash to make all payments required to
be made on the Effective Date.

10.2 Conditions Precedent to Effective Date of the Plan. Each of the following shall
be a condition precedent to the Effective Date of, and consummation of, this Plan:

10.2(a) The Confirmation Date shall have occurred;

10.2(b) No stay shall be in effect with respect to the Confirmation Order;

10.2(c) The Confirmation Order shall be a Final Order, unless waived; and

10.2(d) All documents, agreements and instruments required for the


consummation of this Plan have been executed, are not subject to dispute and are
valid and legally binding obligations of the parties thereto;

10.3 Consequences in the Event that the Effective Date of this Plan does not Occur. In
the event that the Effective Date of this Plan does not occur: (a) all property of the Estates and all
property of the Reorganized Debtors shall revest in the Estates; (b) this Plan, automatically

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without further order of the Bankruptcy Court, shall be, and shall be deemed, null and void, with
no force or legal effect whatsoever; and (c) the Confirmation Order, automatically without
further order of the Bankruptcy Court, shall be, and shall be deemed, null, void and vacated, with
no force or legal effect whatsoever.

10.4 Waiver of Conditions. Upon the written consent of the Plan Proponent, one or
more of the conditions precedent to effectiveness of the Plan set forth in Section 10.1 and 10.2
above may be waived.

10.5 Continuation of Bankruptcy Injunction or Stays. All injunctions or stays provided


for in the Chapter 11 Case under Sections 105 or 362 of the Bankruptcy Code, or otherwise, and
in existence on the Confirmation Date, shall remain in full force and effect until the Effective
Date.

ARTICLE XI

RETENTION OF JURISDICTION

11.1 Retention of Jurisdiction. Notwithstanding entry of the Confirmation Order or the


Effective Date of the Plan having occurred, the Bankruptcy Court will retain exclusive
jurisdiction of all matters arising out of, and related to, the Chapter 11 Case and this Plan
pursuant to, and for the purposes of, Sections 105(a) and 1142 of the Bankruptcy Code and for,
among other things, the following purposes:

11.1(a) to determine all questions and disputes regarding title to the assets of the
Debtors, all causes of action, controversies, disputes or conflicts, whether or not subject to any
pending action as of the Effective Date of the Plan, between a Debtor and any other party,
including, without limitation, any right to recover assets pursuant to the provisions of the
Bankruptcy Code;

11.1(b) to modify this Plan after the Effective Date of the Plan pursuant to the
Bankruptcy Code and the Bankruptcy Rules;

11.1(c) to enforce and interpret the terms and conditions of this Plan;

11.1(d) to enter such orders, including, but not limited to, such future injunctions
as are necessary to enforce the respective title, rights and powers of the Debtors, and to impose
such limitations, restrictions, terms and conditions on such title, rights and powers as the
Bankruptcy Court may deem necessary;

11.1(e) to correct any defect, cure any omission or reconcile any inconsistency in
this Plan or the Confirmation Order as may be necessary to implement the purposes and intent of
this Plan;

11.1(f) to determine any and all objections to the allowance of Claims;

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11.1(g) to determine any and all applications for allowances of compensation and
reimbursement of expenses and the reasonableness of any fees and expenses authorized to be
paid or reimbursed to the Professionals;

11.1(h) to determine any applications or motions pending on the Effective Date


of the Plan for the rejection, assumption or assumption and assignment of any executory contract
or unexpired lease, to hear and determine, and, if need be, to liquidate any and all Claims arising
therefrom, and to adjudicate any other issues arising under this Plan;

11.1(i) to determine any and all applications, adversary proceedings and


contested matters that may be pending on the Effective Date of the Plan;

11.1 (j) to hear and determine the Avoidance Actions or matters related
thereunder to enable the Debtors to prosecute the Avoidance Actions not herein released;

11.1 (k) to determine any Claim or liability to a governmental unit which may be
asserted as a result of the transactions contemplated herein;

11.1(l) to hear and determine matters concerning state, local, and federal taxes in
accordance with Sections 346, 505 and 1146 of the Bankruptcy Code; and

11.1(m) to consider any modification of this Plan, whether or not this Plan has
been substantially consummated, to remedy any defect or omission or reconcile any
inconsistency in any order of the Bankruptcy Court;

11.1(n) to determine all controversies, suits and disputes that may arise in
connection with the interpretation, enforcement or consummation of this Plan;

11.1(o) to consider and act on the compromise and settlement of any claim
against or cause of action by or against the Debtors arising in connection with this Plan;

11.1(p) to issue such orders in aid of execution of this Plan to the extent
authorized by Section 1142 of the Bankruptcy Code; and

11.1(q) to determine such other matters as may be set forth in any order or orders
confirming this Plan or which may arise in connection with this Plan or any order or orders
confirming this Plan.

11.1® enter a final decree closing the applicable Chapter 11 Cases.

11.1 (s) to determine such other matters as may be provided for in the
Confirmation Order or as may be authorized under the provisions of the Bankruptcy Code.

11.2 Additional Jurisdiction. If the Bankruptcy Court abstains from exercising


jurisdiction or is otherwise without jurisdiction over any matter arising out of the Chapter 11

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Case, including without limitation the matters set forth in this Article, this Article shall have no
effect upon and shall not control, prohibit, or limit the exercise of jurisdiction by any other court
having competent jurisdiction with respect to such matter.

11.3 Non-Core Matters. Nothing contained in the Plan is intended, or shall be


construed, to prohibit the Reorganized Debtors from filing, prosecuting, or defending non-core
Causes of Action in venues and jurisdictions other than the Court.

ARTICLE XII

MODIFICATION AND REVOCATION OF PLAN

12.1 Modification of this Plan. Subject to the restrictions on plan of reorganization


modifications set forth in Section 1127 of the Bankruptcy Code, the Plan Proponent reserves the
right to alter, amend or modify this Plan before its substantial consummation.

12.2 Withdrawal of this Plan. The Plan Proponent reserves the right to revoke or
withdraw this Plan at any time before the Confirmation Date. If the Plan Proponent revokes or
withdraws this Plan prior to the Confirmation Date, or if the Confirmation Date or the Effective
Date of the Plan does not occur, then this Plan shall be deemed null and void. In such event,
nothing contained herein shall be deemed to constitute an admission of validity, waiver or
release of any claims by or against the Debtors or any other Person or prejudice in any manner
the rights of the Debtors or any Person in any proceeding involving the Debtors.

ARTICLE XIII

CORPORATE ACTION

13.1 Effectuating Documents and Further Transactions. The Debtors are authorized to
execute, deliver, file, or record such contracts, instruments, releases, and other agreements or
documents and take such actions as may be necessary or appropriate to effectuate and further
evidence the terms and conditions of the Plan.

13.2 Corporate Action. All terms of this Plan may be put into effect and carried out
without further action by the Debtors or their respective board of directors. The Debtors’
respective Board of Directors has approved this Plan prior to it being filed and further approved
all agreements and transactions provided for or contemplated herein.

13.3 Corporate Action. The articles of incorporation and bylaws of the Reorganized
Debtors shall comply with Section 1123(a)(6) of the Bankruptcy Code and may be amended and
restated in a form to be attached to the Confirmation Order. On the Effective Date, the adoption
of the articles of incorporation and bylaws of the Reorganized Debtors or any other similar
constituent documents., the selection of directors and officers or the Reorganized Debtors, and
all other actions contemplated by this Plan shall be deemed authorized and approved in all
respects and any corporate action required by the Reorganized Debtors in connection with this

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Plan, shall be deemed to have occurred and shall be in effect without any requirement of further
action by the Reorganized Debtors and members of the respective boards of directors of the
Reorganized Debtors shall be authorized and directed to issue, execute, deliver, file or record
such contracts, instruments, releases, indentures and other agreements or documents, securities
and instruments contemplated by this Plan in the name of and on behalf of the Reorganized
Debtors.

13.4 Section 1142(b) Performance of Acts Necessary to Consummate the Plan.


Pursuant to Section 1142(b) of the Bankruptcy Code, any and all non-Debtor entities shall, and
are directed to, execute and deliver, or join in the execution or delivery of, any document
required to effectuate a transfer of property dealt with under the Plan, and perform any other act
that is necessary for the consummation of the Plan.

ARTICLE XIV

MISCELLANEOUS PROVISIONS

14.1 Term of Injunctions or Stays. Without in any way limiting the effect of
Sections 524 or 1141 of the Bankruptcy Code, unless otherwise provided, all injunctions or stays
provided for in the Chapter 11 Cases pursuant to Sections 105 or 362 of the Bankruptcy Code or
otherwise in effect as of the Confirmation Date shall remain in full force and effect until the
Effective Date of the Plan and unless otherwise provided shall expire on the Effective Date of
the Plan.

14.2 Injunction. Except as specifically provided in the Plan to the contrary, the
satisfaction and discharge set forth in Sections 7.1 and 7.2 hereof shall also operate as an
injunction prohibiting and enjoining the commencement or continuation of any action, the
employment of process or any act in furtherance of (a) any attempt to collect, recover from,
offset or recoup any Claim against or Interest in a Debtor or Reorganized Debtor by any entity,
and (b) any claim or cause or action, whether known or unknown, against a Released Party
released hereunder based upon or related to the same subject matter as any Claim or Interest or
other released matter.

14.3 Exculpation and Limitation of Liability. The Plan provides that the members of
the Plan Proponent and the Creditors’ Committee and their respective representatives,
employees, management agents, Professionals and affiliates (a) shall have no liability
whatsoever to any Holder or purported Holder of an Administrative Claim, Claim, or Equity
Interest for any act or omission in connection with, or arising out of, the Plan, the Disclosure
Statement, the negotiation of the Plan, the pursuit of approval of the Disclosure Statement or the
solicitation of votes for confirmation of the Plan, the Chapter 11 Cases, the consummation of the
Plan, the administration of the Plan or the property to be distributed under the Plan, or any
transaction contemplated by the Plan or Disclosure Statement or in furtherance thereof except for
any act or omission that constitutes willful misconduct or gross negligence as determined by a
Final Order, and (b) in all respects, shall be entitled to rely upon the advice of counsel with

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respect to their duties and responsibilities under the Plan. Notwithstanding the foregoing, the
Plan shall not release, discharge, or exculpate any non-Debtor party from any debt owned to the
United States Government and/or its agencies (the “Government”), or from any liability arising
under the Internal Revenue Code, the Employee Retirement Income Security Act of 1974, as
amended, or the environmental laws, securities laws or criminal laws of the United States. In
addition, notwithstanding Sections 14.1 and 14.2 of the Plan, the Plan shall not enjoin or prevent
the Government from collecting any such liability from any such non-Debtor party.

14.4 Payment of Statutory Fees. All fees payable pursuant to Section 1930 of Title 28
of the United States Code, as determined by the Bankruptcy Court at the hearing pursuant to
Section 1128 of the Bankruptcy Code, shall be paid on or before the Effective Date of the Plan
and each Debtor shall continue to pay the required fees until the entry of an order closing,
converting or dismissing its Chapter 11 Case.

14.5 Administrative Claims Bar Date. Unless established by earlier order of the Court,
the Confirmation Order will establish a bar date for filing applications for the allowance of
Administrative Claims (except for Professional Fee Claims or Administrative Claims that have
already been Allowed by Final Order), which date (the “Administrative Claims Bar Date”) will
be the first Business Day that is thirty (30) days after the Effective Date. Holders of
Administrative Claims (except for Professional Fee Claims or Administrative Claims that have
already been Allowed by Final Order) not paid prior to the Confirmation Date shall submit
requests for payment on or before the Administrative Claims Bar Date or forever be barred from
doing so and from receiving payment thereof. The notice of Confirmation to be delivered
pursuant to Bankruptcy Rules 3020(c) and 2002(f) will set forth the Administrative Claims Bar
Date and constitute notice of the Administrative Claims Bar Date. The Reorganized Debtors
shall have one hundred-twenty (120) days (or such longer period as may be allowed by order of
the Court) following the Administrative Claims Bar Date (the “Administrative Claims Objection
Deadline”) to review and object to all Administrative Claims.

14.6 Exemption from Transfer Taxes. In accordance with Section 1146(c) of the
Bankruptcy Code, (a) bills of sale or assignments executed in connection with any of the
transactions contemplated under the Plan, or the transfer or sale of any real or personal property
of the Debtors pursuant to, in implementation of, or as contemplated by the Plan, (b) the making,
delivery, creation, assignment, amendment or recording of any note or other obligation for the
payment of money or any mortgage, deed of trust or other security interest under, in furtherance
of, or in connection with the Plan, the issuance, renewal, modification or securing of
indebtedness by such means, and (c) the making, delivery or recording of any deed or other
instrument of transfer under, in furtherance of, or in connection with, the Plan, including,
without limitation, the Confirmation Order, shall not be subject to any document recording tax,
stamp tax, conveyance fee or other similar tax, mortgage tax, real estate transfer tax, mortgage
recording tax or other similar tax or governmental assessment. Consistent with the foregoing,
each recorder of deeds or similar official for any county, city or governmental unit in which any
instrument hereunder is to be recorded shall, pursuant to the Confirmation Order, be ordered and
directed to accept such instrument, without requiring the payment of any documentary stamp tax,
deed stamps, stamp tax, transfer tax, intangible tax or similar tax.

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14.7 No Admissions. Notwithstanding anything herein to the contrary, nothing


contained in this Plan shall be deemed as an admission by a Debtor with respect to any matter set
forth herein including, without limitation, liability on any Claim or the propriety of any Claims
classification.

14.8 Satisfaction of Subordination and Other Rights. All Claims, including the Claims
of the Holders of all notes issued by the Debtors, and all rights and Claims between or among
such Holders relating in any manner whatsoever to any claimed lien rights or subordination
rights, shall be deemed satisfied by the distributions made during the Chapter 11 Cases and
distributions under, described in, contemplated by, and/or implemented in this Plan.
Distributions under, described in, contemplated by, and/or implemented by this Plan to the
various Classes of Claims hereunder shall not be subject to levy, garnishment, attachment, or
like legal process by any Holder of a Claim, by reason of any claimed lien or subordination
rights or otherwise, so that each Holder of a Claim shall have and receive the benefit of the
distributions in the manner set forth in the Plan.

14.9 Post-Effective Date of the Plan Effect of Evidences of Claims or Equity Interests.
Except as otherwise provided herein or in the Confirmation Order, on the Effective Date of the
Plan all evidence of Claims or Equity Interests, including, without limitation, notes, bonds and
membership unit certificates, will represent only the right to participate in the distributions
contemplated by this Plan.

14.10 Time. Except as otherwise provided in the Bankruptcy Rules, in computing any
period of time prescribed or allowed by this Plan, the day of the act, event or default from which
the designated period of time begins to run will not be included. Except as otherwise provided
in the Bankruptcy Rules, the last day of the period so computed will be included, unless it is not
a Business Day or, when the act to be done is the filing of a paper in court, weather or other
conditions have made the clerk's office inaccessible, in which event the period shall run until the
end of the next day which is not one of such days.

14.11 Amendments. The Plan Proponent may, with the approval of the Bankruptcy
Court, and without notice to all Holders of Claims and Equity Interests, insofar as it does not
materially and adversely affect Holders of Claims and Equity Interests, correct any defect,
omission, or inconsistency in this Plan in such manner and to such extent as may be necessary or
desirable.

14.12 Successors and Assigns. The rights, benefits and obligations of any Person or
entity named or referred to in this Plan shall be binding upon, and shall inure to the benefit of,
the heir, executor, administrator, successor or assign of such Person or entity.

14.13 Modifications and Amendments. The Plan may be altered, amended or modified
by the Plan Proponent under Section 1127(a) of the Bankruptcy Code at any time prior to the
Confirmation Date. After the Confirmation Date and prior to substantial consummation of the

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Plan, as defined in Section 1101(2) of the Bankruptcy Code, and the Plan Proponent may, under
Section 1127(b) of the Bankruptcy Code, institute proceedings in the Bankruptcy Court to
remedy any defect or omission or reconcile any inconsistencies in the Plan, the Disclosure
Statement, or the Confirmation Order, or between or among such documents, and to raise such
matters as may be necessary or appropriate to carry out the purposes and effects of the Plan, so

long as such proceedings do not materially adversely affect the treatment of Holders of Claims
under the Plan; provided, however, that prior notice of such proceedings shall be served in
accordance with the Bankruptcy Rules or order of the Bankruptcy Court.

14.14 Headings. The headings of the Articles and Sections of this Plan are inserted for
convenience only and will not affect the interpretation hereof.

14.15 Severability of Plan Provisions. If prior to Confirmation any term or provision of


this Plan which does not govern the treatment of Claims or Equity Interests, the conditions to
the Effective Date of the Plan is held by the Bankruptcy Court to be invalid, void or
unenforceable, the Bankruptcy Court shall have the power to alter and interpret such term or
provision to make it valid and enforceable to the maximum extent practicable, consistent with
the original purpose of the term or provision held to be invalid, void, or unenforceable, and such
term or provision shall then be applicable as altered or interpreted. Notwithstanding any such
holding, alteration or interpretation, the remainder of the terms and provisions of this Plan will
remain in full force and effect and will in no way be affected, impaired, or invalidated by such
holding, alteration, or interpretation. The Confirmation Order shall constitute a judicial
determination and shall provide that each term and provision of this Plan, as it may have been
altered or interpreted in accordance with the foregoing, is valid and enforceable pursuant to its
terms.

14.16 Termination of Committee. Ten (10) business days after the Effective Date of the
Plan, the existence and service of the Creditors’ Committee, and any other fiduciary serving in
this Chapter 11 case shall be deemed terminated, without further order of the Court or act by any
Person.

14.17 Creation of Post-Confirmation Committee. Upon the Effective Date, the Post-
Confirmation Committee shall be seated and have the power to (1) monitor the implementation
of the Plan; (2) bring Avoidance Actions against Robert Swift, Robert Burg and any entity in
which either of them have an interest or against any Insider of either of them; and (3) bring
objections to claims against Robert Swift, Robert Burg and any entity in which either of them
have an interest or against any Insider of either of them.

14.18 Binding Effect. The rights, duties and obligations of any Person named or
referred to in this Plan shall be binding upon, and shall inure to the benefit of, the successors and
assigns of such Person.

14.19 Effect of Non-Consummation. Except as otherwise provided herein, if either

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Confirmation or consummation of the Plan does not occur, then (a) the Plan shall be null and
void in all respects, (b) any settlement or compromise embodied in the Plan (including the fixing
or limiting to an amount certain any Claim or Class of Claims), assumption or rejection of
executory contracts or leases effected by the Plan, and any document or agreement executed
pursuant to the Plan, shall be deemed null and void, and (c) nothing contained in the Plan, and no
acts taken in preparation for consummation of the Plan, shall (x) constitute or be deemed to
constitute a waiver or release of any Claims by or against, or any Interests in, the Debtors or any
other Entity, (y) prejudice in any manner the rights of the Debtors, the Creditors’ Committee or
any Entity in any further proceedings involving the Debtors, or (z) constitute an admission of
any sort by the Debtors, the Creditors’ Committee or any other Entity.

14.20 Plan Exhibits. Any and all Plan Exhibits, or other lists or schedules not filed with
the Plan shall be filed with the Clerk of the Bankruptcy Court at least five (5) Business Days
prior to the date of the commencement of the Confirmation Hearing. Upon such filing, such
documents may be inspected in the office of the Clerk of the Bankruptcy Court during normal
court hours.

14.21 Notices. All notices, requests and demands under this Plan shall be in writing
and, unless otherwise expressly provided herein, shall be deemed to have been duly given or
made when actually delivered or, in the case of notice by facsimile transmission, when received
and telephonically confirmed, addressed as follows:

If to the Debtors or Reorganized Debtors:

LaMonte Forthun
2 Old Ridge Road
Monmouth, NJ 08852

With a copy to:


Heller, Draper, Hayden, Patrick & Horn, LLC
650 Pydras Street, Suite 2500
New Orleans, LA 70130
Attn: Douglas Draper
Tel.: 504-299-3300
Fax: 504-299-3399

If to the Creditors’ Committee:

Sam Johns
[address]

With a copy to:


Sonnenschein Hath & Rosenthal, LLP
7800 Sears Tower
Chicago, IL 60606

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Attn: Robert Richards


Tel.: 312-876-7396
Fax: 312-876-7934

If to Plan Proponent:

LaMonte Forthun
2 Old Ridge Road
Monmouth, NJ 08852

With a copy to:


B. Lane Hasler, P.C.
1530 S. State Street
Suite 17A
Chicago, IL 60605
Attn: B. Lane Hasler
Tel./Fax: 312-893-0551

14.22 Governing Law. Except to the extent the Bankruptcy Code, Bankruptcy Rules
or other federal law is applicable, or to the extent the Plan provides otherwise, the rights and
obligations arising under this Plan shall be governed by, and construed and enforced in
accordance with, the laws of the State of Illinois, without giving effect to the principles of
conflicts of law of such jurisdiction.

Dated: November 8, 2009


LAMONTE FORTHUN

By:

Counsel For LaMonte Forthun

B. Lane Hasler
B. Lane Hasler, P.C
1530 South State Street
Suite 17A
Chicago, Illinois 60605

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Telephone/Facsimile: 312-893-0551

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