Local Rule 3016-2: Chapter 11 Disclosure Statement

Rule 3016-2 Chapter 11 Disclosure Statement

(a) Table of Contents. Unless otherwise ordered by the court, a disclosure statement must contain a table of contents, with appropriate page numbers, that fully lists the headings and subheadings set forth in subsection (b).

(b) Content. Unless otherwise ordered by the court or as provided in AK LBR 3017-2, the disclosure statement must include information covering the following topics, when applicable:

(1) Short history of the business activities of the debtor covering the five-year period preceding the petition filing date, or such shorter period as the debtor has been operating its business.

(2) General nature of the business transacted and to be transacted by the debtor.

(3) A complete description of equity interests, including: [A] number and classes of shares; [B] description of the voting rights and other properties or attributes of the stock; and [C] any outstanding options.

(4) Names and addresses of all persons owning more than five percent (5%) of any equity interest and the percentage so held.

(5) For all debtors, a listing of affiliate entities and their relationships to the debtor.

(6) Complete description of the business, including: [A] competitive conditions in the industry and debtor's competitive condition; [B] principal product(s) and/or services; [C] current backlog of business (e.g. current orders for products or services or current uncompleted contracts to provide products or services) and comparable figures for the same time during each of the two (2) years preceding the date the plan is filed; [D] (i) if a manufacturing or fabricating business, source and availability of raw materials, or (ii) if a retail or wholesale business, source and availability of goods or product sold in the ordinary course of business; [E] existence and significance of any patents, trademarks, licenses, franchises and concessions; [F] nature, scope and importance of any research and development activities; [G] number of persons employed by category (e.g., executive officers, supervisory personnel, production personnel, sales personnel); [H] seasonal nature of business; [I] description of any foreign operations; and [J] governmental regulatory agencies having jurisdiction over debtor's operations, including the nature of the regulatory supervision and any problems encountered or anticipated.

(7) Description of any pending and anticipated legal or administrative proceedings.

(8) Description of securities to be issued, if any, and consideration to be received in connection with the issuance.

(9) Information regarding officers and directors of a corporation, general partners of a partnership, or managers of a limited liability company to be continued in office upon confirmation of the plan, including: [A] name and position held; [B] familial relationship, if any, to: (i) other officers, (ii) directors, (iii) general partners, or (iv) managers; [C] complete disclosure of all remuneration, including salaries, bonuses, fringe benefits, and stock options; and [D] whether or not each individual is an "insider."

(10) Financial information that accurately sets forth: [A] summaries of tax returns for the three (3) tax years preceding the date the plan is filed; [B] current balance sheet, including all appropriate footnotes and assumptions; [C] projected balance sheet applicable upon confirmation of the plan, including all appropriate footnotes and assumptions; [D] income statements accurately reflecting debtor's income and expenses since the fiscal year of the debtor's last tax return until two (2) months prior to the filing of the disclosure statement; [E] income/expense and cash flow projections of operations over the term of the payment to unsecured creditors or five (5) years, whichever is less, including all assumptions underlying those projections; [F] a schedule of payments to be made towards obligations undertaken by the debtor as part of the plan; [G] a description of the debtor's working capital position and any changes thereto expected to occur within the first twelve (12) months of the plan; [H] brief explanation of the tax consequences, if any, of plan confirmation; [I] if applicable, income and expense information for each profit center, line of business and class of similar products or services; [J] attorney and professional fees for debtor and all payments made or expected to be made for services in connection with the case or plan; [K] if the plan calls for the liquidation of real or personal property in conjunction with the plan, current values of the property to be liquidated; [L] source of financial information in paragraphs [A]-[K] hereof and the qualifications of the source; [M] a list, by the classes established in the plan and alphabetically within each class, of all claims and interests for which proofs of claim have been filed or deemed filed in the case that are allowed or deemed allowed, that includes: (i) the name of the holder of each claim or interest, and (ii) the claimed or deemed allowed amount of each claim or interest; [N] a list of all disputed, contingent and unliquidated claims for which the claimants have filed proofs of claim and a discussion of the impact, if any, the allowance of these claims will have on the plan, debtor and other parties in interest; and [O] a liquidation analysis with a specific description of all assumptions underlying the analysis.

(11) Description of the plan, how it is to be implemented and its effect on all classes of creditors and equity interests.

(12) Description of management to be retained and compensation to be paid, including as a minimum: [A] for corporations- (i) the chief executive officer, (ii) chief operating officer, (iii) chief financial officer, and (iv) general managers of any facility, division or department; [B] for limited partnerships- (i) the general partners, and (ii) any general manager of any facility, division or department; [C] for general partnerships- (i) the managing partner or members of any management committee, and (ii) general managers of any facility, division or department; [D] for limited liability companies, any manager or member; and [E] for individuals, the debtor and any person holding a position comparable to the chief executive officer, chief operating officer, chief financial officer or general manager of a corporate entity.

(13) Any dividends, draws or other payments, other than as compensation as set forth in paragraph (b)(9) or reimbursement of expenses incurred in the ordinary course of debtor's business, contemplated to be made to, or for the benefit of, equity security holders, partners, members, or individual debtors.

(14) Transactions with insiders and potential conflicts of interest involving each member of management for which disclosure is made under paragraph (b)(12), and of every shareholder, partner or member holding more than a ten percent (10%) equity or profits interest in debtor, including: [A] full particulars of the nature and extent of the interest of those persons in any property acquired other than in the ordinary course of business of the debtor within two years preceding the filing of the petition; [B] description of management contracts and any contracts made other than in the ordinary course of business with those persons; [C] loans made to or obligations incurred by such persons; [D] any guarantees of indebtedness by or for those persons; and [E] transactions with those persons that are necessary to, or contemplated by, the plan.

(15) Information concerning changes occurring within the twelve (12) months preceding the disclosure statement affecting revenue and expenses, including: [A] product mix; [B] added, discontinued or significantly modified operations; [C] advertising, research, development, product introduction or deletion, or other discretionary costs; [D] acquisition or disposition of any material asset other than in the ordinary course of business; [E] material extraordinary charges or gains, including charges associated with any discontinuation of operations; and [F] material changes in assumed investment return.

(16) Information concerning changes expected to occur within the first twelve (12) months of the plan affecting revenue and/or expenses, including any closing of a facility, branch or other material interruption, completion of a material contract, or any event that will materially reduce or increase revenues in subsequent periods (as used herein, "materially'' means a change often (10) or more percentage points).

(17) Other information, including: [A] extraordinary risk factors; [B] nondischargeable debts (individuals only); [C] effect of plan on retiree benefits, if any; [D] brief explanation of the cause of debtor's financial difficulties and the reason(s) those difficulties are not expected to recur during the life of the plan; [E] vote required for acceptance of the plan; and [F] disposition of equity interests in corporate, partnership, or limited liability company debtors.

(c) Individual Debtor. In a case in which the debtor is an individual, in addition to information required by subsection (b), the debtor must provide a computation of debtor's disposable income determined as provided in § 1325(b)(2) of the Code, itemized to show how the amount is calculated.

(d) Consultation with United States Trustee. Unless waived by the United States trustee, not less than seven (7) days before the plan and disclosure statement are filed, counsel for the proponent or the proponent will consult with the United States trustee regarding the proper formulation of a plan and disclosure statement.