UNITED STATES BANKRUPTCY COURT FOR THE NORTHERN DISTRICT OF 

TEXAS, DALLAS DIVISION 

In Re: Highland Capital Management, L.P. § Case No. 19-34054-SGJ-11 

The Charitable DAF Fund LP § 

 Appellant § 22-03052 

vs. § 

Highland Capital Management, L.P. § 

 Appellee § 3:22-CV-02280-S

[43] Order granting amended motion to dismiss adversary proceeding with prejudice (related 

document # 19) Entered on 9/30/2022 

APPELLANT RECORD 

VOLUME 7 

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PACHULSKI STANG ZIEHL & JONES LLP 

Jeffrey N. Pomerantz (CA Bar No. 143717) 

Robert J. Feinstein (NY Bar No. 1767805) 

John A. Morris (NY Bar No. 266326) 

Gregory V. Demo (NY Bar No. 5371992) 

Hayley R. Winograd (NY Bar No. 5612569) 

10100 Santa Monica Blvd., 13th Floor 

Los Angeles, CA 90067 

Telephone: (310) 277-6910 

Facsimile: (310) 201-0760 

Email: jpomerantz@pszjlaw.com 

 rfeinstein@pszjlaw.com 

 jmorris@pszjlaw.com 

 gdemo@pszjlaw.com 

 hwinograd@pszjlaw.com 

-andHAYWARD PLLC 

Melissa S. Hayward 

Texas Bar No. 24044908 

MHayward@HaywardFirm.com 

Zachery Z. Annable 

Texas Bar No. 24053075 

ZAnnable@HaywardFirm.com 

10501 N. Central Expy, Ste. 106 

Dallas, Texas 75231 

Tel: (972) 755-7100 

Fax: (972) 755-7110 

Counsel for Highland Capital Management, L.P.

IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF TEXAS 

DALLAS DIVISION 

THE CHARITABLE DAF FUND, L.P., 

 Plaintiff, 

vs. 

HIGHLAND CAPITAL MANAGEMENT, L.P., 

 Defendant. 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

Case No. 3:21-cv-01710-N 

HIGHLAND CAPITAL MANAGEMENT, L.P.’S MOTION TO DISMISS 

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Highland Capital Management, L.P. (“Highland”), the putative defendant in the abovecaptioned case (the “Action”), by and through its undersigned counsel, files this motion (the 

“Motion”) to dismiss the Action. In support of its Motion, Highland states as follows: 

JURISDICTION AND VENUE 

1. This Court has jurisdiction over the Motion pursuant to section 1334(a) and (b) of 

title 11 of the United States Code (the “Bankruptcy Code”). 

2. Venue is proper in this judicial district pursuant to 28 U.S.C. § 1409. 

3. The predicates for the relief requested in the Motion are 28 U.S.C. § 157(a), Rule 

9019 of the Federal Rules of Bankruptcy Procedure (the Bankruptcy Rules), and Rules 12(b)(1), 

(3), (4), and (6) of the Federal Rules of Civil Procedure, made applicable in this Action pursuant 

to Bankruptcy Rule 7012. 

RELIEF REQUESTED 

4. Through this Motion, Highland requests that this Court issue the proposed form of 

order attached as Exhibit A (the “Proposed Order”) pursuant to 28 U.S.C. § 157(a). 

5. For the reasons set forth more fully in Highland Capital Management, L.P.’s 

Memorandum of Law in Support of Its Motion to Dismiss (the “Memorandum of Law”) filed 

contemporaneously with this Motion, Highland requests that the Court: (a) dismiss the Action with 

prejudice, and (b) grant such other and further relief as the Court deems just and proper. 

6. In accordance with Rule 7.1 of the Local Civil Rules of the United States District 

Court for the Northern District of Texas (the “Local Rules”), contemporaneously herewith and in 

support of the Motion Highland is filing: (a) its Memorandum of Law, and (b) the Appendix in 

Support of Motion to Dismiss (the “Appendix”), together with the exhibits annexed thereto. 

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7. Based on the exhibits annexed to the Appendix and the arguments contained in the 

Memorandum of Law, Highland is entitled to the relief requested herein as set forth in the Proposed 

Order. 

8. Notice of this Motion has been provided to all parties. Highland submits that no 

other or further notice need be provided. 

WHEREFORE, Highland respectfully requests that the Court (i) enter the Proposed Order 

substantially in the formed annexed hereto as Exhibit A granting the relief requested herein, and 

(ii) grant Highland such other and further relief as the Court may deem proper. 

[Remainder of Page Intentionally Blank] 

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Dated: October 5, 2021. PACHULSKI STANG ZIEHL & JONES LLP 

Jeffrey N. Pomerantz (CA Bar No. 143717) 

Robert J. Feinstein (NY Bar No. 1767805) 

John A. Morris (NY Bar No. 266326) 

Gregory V. Demo (NY Bar No. 5371992) 

Hayley R. Winograd (NY Bar No. 5612569) 

10100 Santa Monica Blvd., 13th Floor 

Los Angeles, CA 90067 

Telephone: (310) 277-6910 

Facsimile: (310) 201-0760 

Email: jpomerantz@pszjlaw.com 

 rfeinstein@pszjlaw.com 

 jmorris@pszjlaw.com 

 gdemo@pszjlaw.com 

 hwinograd@pszjlaw.com 

-andHAYWARD PLLC 

/s/ Zachery Z. Annable 

 Melissa S. Hayward 

Texas Bar No. 24044908 

MHayward@HaywardFirm.com 

Zachery Z. Annable 

Texas Bar No. 24053075 

ZAnnable@HaywardFirm.com 

10501 N. Central Expy, Ste. 106 

Dallas, Texas 75231 

Tel: (972) 755-7100 

Fax: (972) 755-7110 

Counsel for Highland Capital Management, L.P.

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CERTIFICATE OF SERVICE 

I hereby certify that, on October 5, 2021, a true and correct copy of the foregoing Motion 

was served electronically upon all parties registered to receive electronic notice in this case via the 

Court’s CM/ECF system. 

/s/ Zachery Z. Annable

Zachery Z. Annable 

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EXHIBIT A 

 

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IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF TEXAS 

DALLAS DIVISION 

THE CHARITABLE DAF FUND, L.P., 

 Plaintiff, 

vs. 

HIGHLAND CAPITAL MANAGEMENT, L.P., 

 Defendant. 

§ 

§ 

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§ 

§ 

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§ 

Case No. 3:21-cv-01710-N 

ORDER GRANTING MOTION TO DISMISS 

Before the Court is Highland Capital Management L.P.’s Motion to Dismiss [Docket No. 

__] (the “Motion”).1

 Having considered: (a) the Motion; (b) Highland Capital Management, 

L.P.’s Memorandum of Law in Support of Its Motion to Dismiss [Docket No. __] (the 

“Memorandum of Law”); and (c) the Appendix in Support of Motion to Dismiss [Docket No. __] 

(the “Appendix”), and the exhibits annexed thereto; and this Court having jurisdiction over this 

matter pursuant to 28 U.S.C. §§ 157 and 1334; and this Court having found that (a) venue of this 

proceeding and the Motion in this District is proper pursuant to 28 U.S.C. § 1409; (b) the Effective 

Date has occurred; (c) the Confirmation Order and Plan enjoin Plaintiff from continuing any action 

or suit against Highland and mandate that claims against Highland be brought in the Bankruptcy 

Court following the Effective Date pursuant to the Injunction Provision; (d) the purported claims 

asserted against Highland arise from transactions that took place post-petition and, to the extent 

1

 Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the 

Memorandum of Law. 

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valid, would constitute post-petition administrative claims; (e) the Plan provides a specific 

procedure through which holders of purported administrative claims, such as Plaintiff, can file an 

application with the Bankruptcy Court for allowance of its administrative expense claims; and (f) 

based on the foregoing, under the Confirmation Order and Plan, this Court is not the appropriate 

venue for this Action; and this Court having found that Highland’s notice of the Motion and 

opportunity for a hearing on the Motion were appropriate under the circumstances and that no 

other notice need be provided; and this Court having determined that the legal and factual bases 

set forth in the Motion establish good cause for the relief granted herein; and upon all of the 

proceedings had before this Court; and after due deliberation and sufficient cause appearing 

therefor, and for the reasons set forth in the record on this Motion, it is HEREBY ORDERED 

THAT: 

1. The Motion is GRANTED. 

2. The Action is DISMISSED with prejudice. 

It is so ordered this ________ day of __________________, 2021. 

 ____________________________________ 

 The Honorable David C. Godbey 

 United States District Judge

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PACHULSKI STANG ZIEHL & JONES LLP 

Jeffrey N. Pomerantz (CA Bar No. 143717) 

Robert J. Feinstein (NY Bar No. 1767805) 

John A. Morris (NY Bar No. 266326) 

Gregory V. Demo (NY Bar No. 5371992) 

Hayley R. Winograd (NY Bar No. 5612569) 

10100 Santa Monica Blvd., 13th Floor 

Los Angeles, CA 90067 

Telephone: (310) 277-6910 

Facsimile: (310) 201-0760 

Email: jpomerantz@pszjlaw.com 

 rfeinstein@pszjlaw.com 

 jmorris@pszjlaw.com 

 gdemo@pszjlaw.com 

 hwinograd@pszjlaw.com 

-andHAYWARD PLLC 

Melissa S. Hayward 

Texas Bar No. 24044908 

MHayward@HaywardFirm.com 

Zachery Z. Annable 

Texas Bar No. 24053075 

ZAnnable@HaywardFirm.com 

10501 N. Central Expy, Ste. 106 

Dallas, Texas 75231 

Tel: (972) 755-7100 

Fax: (972) 755-7110 

Counsel for Highland Capital Management, L.P.

IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF TEXAS 

DALLAS DIVISION 

THE CHARITABLE DAF FUND, L.P., 

 Plaintiff, 

vs. 

HIGHLAND CAPITAL MANAGEMENT, L.P., 

 Defendant. 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

Case No. 3:21-cv-01710-N 

HIGHLAND’S MEMORANDUM OF LAW 

IN SUPPORT OF ITS MOTION TO DISMISS

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Highland Capital Management, L.P. (“Highland”), a reorganized debtor and the putative 

defendant in the above-captioned action (the “Action”), submits this Memorandum of Law in 

supports of its motion to dismiss the Action (the “Motion”).1 In support of its Motion, Highland 

states as follows: 

I. PRELIMINARY STATEMENT2

1. Highland is a reorganized debtor, having emerged from bankruptcy on August 11, 

2021, when its Plan went effective. 

2. The Charitable DAF Fund, L.P. (“Plaintiff”), a “trust” that exists for the benefit of 

James Dondero, Highland’s former owner who is waging a never-ending grudge match against 

Highland’s stakeholders, commenced this action on July 22, 2021 but never served its Complaint. 

Instead, on August 26, 2021, without notice to Highland, it filed Plaintiffs’ Motion to Stay All 

Proceedings [Docket No. 6] (the “Stay Motion”). On September 7, 2021, this Court entered an 

electronic order granting the unopposed Stay Motion [Docket No. 7] (the “Stay Order”). 

3. Highland is simultaneously filing its Motion for Reconsideration of Stay Order and 

supporting documentation (together, the “Reconsideration Motion”). For the reasons set forth in 

the Reconsideration Motion and herein, Highland respectfully requests that the Court (a) grant the 

Reconsideration Motion and enter a new order vacating the Stay Order and denying the Stay 

Motion, and (b) then grant this Motion to Dismiss. 

4. This Court should enforce the Confirmation Order and dismiss the Action. The 

Confirmation Order and Plan enjoin Plaintiff from continuing any action or suit against Highland, 

1

 Concurrently herewith, Highland is filing the Appendix in Support of Highland Capital Management, L.P.’s Motion 

for Reconsideration of a Stay Order (the “Appendix”). Citations to the Appendix are notated as follows: Ex. #, Appx. 

#. 

2

 All capitalized terms used but not defined in this section have the meanings given to them below. 

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and mandate that claims against Highland be brought in the Bankruptcy Court following the 

Effective Date pursuant to the Injunction Provision. Dismissal of the Action is also warranted 

because the purported claims asserted against Highland arise from transactions that took place 

post-petition, and, to the extent valid, would constitute post-petition administrative claims. The 

Plan provides specific a procedure through which holders of purported administrative claims, such 

as Plaintiff, can file an application with the Bankruptcy Court for allowance of its administrative 

expense claims. Under the Confirmation Order and Plan, this Court is not the appropriate venue 

for this Action. 

5. For the reasons set forth above and below, and pursuant to Federal Rules of Civil 

Procedure 12(b)(1), (3), (4), and (6), Highland respectfully requests that the Court dismiss the 

Action. 

II. RELEVANT BACKGROUND 

A. Case Background 

6. On October 16, 2019 (the “Petition Date”), Highland commenced a voluntary case 

under chapter 11 of title 11 of the United States Code (the “Bankruptcy Code”) in the United States 

Bankruptcy Court for the District of Delaware (the “Bankruptcy Case”). 

B. The Plan and Confirmation Order 

7. On February 22, 2021, the Bankruptcy Court for the Northern District of Texas, 

Dallas Division (the “Bankruptcy Court”) entered its Order (i) Confirming the Fifth Amended Plan 

of Reorganization (as Modified) and (ii) Granting Related Relief [Bankr. Dkt. No. 1943] (Ex. 1, 

Appx. 1-162) (the “Confirmation Order”) which confirmed the Fifth Amended Plan of 

Reorganization of Highland Capital Management, L.P (as Modified) (Ex. 2, Appx. 163-229) (the 

“Plan”). Pursuant to the Plan, as of the Effective Date (as defined in the Plan), Enjoined Parties 

(as defined in the Plan) are prohibited from pursuing or continuing actions of any kind against 

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Highland (the “Injunction Provision”). The Plan and the Confirmation Order each provide, in 

pertinent part: 

Injunction 

Upon entry of the Confirmation Order, all Enjoined Parties are and shall be permanently 

enjoined, on and after the Effective Date, from taking any actions to interfere with the 

implementation or consummation of the Plan. Except as expressly provided in the Plan, 

the Confirmation Order, or a separate order of the Bankruptcy Court, all Enjoined Parties 

are and shall be permanently enjoined, on and after the Effective Date, with respect to 

any Claims and Equity Interests, from directly or indirectly (i) commencing, 

conducting, or continuing in any manner any suit, action, or other proceeding of any 

kind (including any proceeding in a judicial, arbitral, administrative or other forum) 

against or affecting the Debtor or the property of the Debtor, (ii) enforcing, levying, 

attaching (including any prejudgment attachment), collecting, or otherwise recovering, 

enforcing, or attempting to recover or enforce, by any manner or means, any judgment, 

award, decree, or order against the Debtor or the property of the Debtor, (iii) creating, 

perfecting, or otherwise enforcing in any manner, any security interest, lien or 

encumbrance of any kind against the Debtor or the property of the Debtor, (iv) asserting 

any right of setoff, directly or indirectly, against any obligation due to the Debtor or against 

property or interests in property of the Debtor, except to the limited extent permitted under 

Sections 553 and 1141 of the Bankruptcy Code, and (v) acting or proceeding in any 

manner, in any place whatsoever, that does not conform to or comply with the provisions 

of the Plan. 

The injunctions set forth herein shall extend to, and apply to any act of the type set forth in 

any of clauses (i)-(v) of the immediately preceding paragraph against any successors of the 

Debtor, including, but not limited to, the Reorganized Debtor, the Litigation SubTrust, and 

the Claimant Trust and their respective property and interests in property. 

... 

The Bankruptcy Court will have sole and exclusive jurisdiction to determine whether 

a claim or cause of action is colorable and, only to the extent legally permissible and as 

provided for in ARTICLE XI, shall have jurisdiction to adjudicate the underlying colorable 

claim or cause of action. 

Ex. 1, Appx. 77-79, and Ex. 2, Appx. 220-221 (emphasis added). By their terms, the Confirmation 

Order and Plan expressly enjoin Plaintiff from continuing the Action. 

8. The Injunction Provision, however, does not leave putative claimants without a 

course to pursue their claims. The Plan includes a mechanism allowing holders of claims arising 

after the Petition Date but prior to the Effective Date to assert claims. They may, at their election, 

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file an application with the Bankruptcy Court seeking an allowed administrative claim. Article II 

of the Plan provides, in relevant part: 

Administrative Expensive Claims 

On the later of the Effective Date or the date on which an Administrative Expense Claim 

becomes an Allowed Administrative Expense Claim, or, in each such case, as soon as 

practicable thereafter, each Holder of an Allowed Administrative Expense Claim (other 

than Professional Fee Claims) will receive, in full satisfaction, settlement, discharge and 

release of, and in exchange for, such Allowed Administrative Expense Claim either (i) 

payment in full in Available Cash for the unpaid portion of such Allowed Administrative 

Expense Claim; or (ii) such other less favorable treatment as agreed to in writing by the 

Debtor or the Reorganized Debtor, as applicable, and such Holder; provided, however, that 

Administrative Expense Claims incurred by the Debtor in the ordinary course of business 

may be paid in the ordinary course of business in the discretion of the Debtor in accordance 

with such applicable terms and conditions relating thereto without further notice to or order 

of the Bankruptcy Court. All statutory fees payable under 28 U.S.C. § 1930(a) shall be paid 

as such fees become due. 

If an Administrative Expense Claim (other than a Professional Fee Claim) is not paid by 

the Debtor in the ordinary course, the Holder of such Administrative Expense Claim must 

File, on or before the applicable Administrative Expense Claims Bar Date, and serve on 

the Debtor or Reorganized Debtor, as applicable, and such other Entities who are 

designated by the Bankruptcy Rules, the Confirmation Order or other order of the 

Bankruptcy Court, an application for allowance and payment of such Administrative 

Expense Claim. 

Ex. 2, Appx. 185-186. If Plaintiff wished to continue its Action, the Confirmation Order mandates 

that it do so by filing for an administrative claim.3

C. Plaintiff Commences the Action but Never Serves Highland, and the Plan Goes 

Effective 

11. On July 22, 2021, Plaintiff commenced the Action by filing its Original Complaint. 

[Docket No. 1] (the “Complaint”). Plaintiff never served the Complaint. 

12. On August 11, 2021, the Plan became Effective (as defined in the Plan), and Highland 

became the Reorganized Debtor (as defined in the Plan). See Notice of Occurrence of Effective Date 

3

 Under the Plan, the Administrative Expense Claim Bar Date passed on September 25, 2021, so Plaintiff would, in 

fact, be required to request an order from the Bankruptcy Court permitting it to file a late claim. Highland reserves 

the right to contest any such request.

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of Confirmed Fifth Amended Plan of Reorganization of Highland Capital Management, L.P. [Bankr. 

Dkt. No. 2700] (Ex. 3, Appx. 230-234). 

D. Plaintiff Obtains an Unopposed Stay of the Action and Highland Seeks 

Reconsideration 

9. On August 26, 2021, Plaintiff filed the Stay Motion, requesting a stay of the Action 

pending resolution of the Fifth Circuit Appeal of the Confirmation Order. In support of its Motion, 

Plaintiff contended that the Appeal “includes direct challenges to the validity” of the Plan’s 

exculpation and injunction provisions, that these “provisions are currently in force and prohibit 

Plaintiffs from continuing this [A]ction,” and the “most efficient course of action” is for a stay. 

Stay Motion at 4. 

10. On September 7, 2021, this Court entered the Stay Order. Highland is 

simultaneously filing its Reconsideration Motion. 

III. ARGUMENT 

A. The Confirmation Order Should Be Enforced and the Action Should Be Dismissed 

11. Dismissal of the Action is warranted under the Confirmation Order and the Plan for 

two reasons: (i) Plaintiffs are enjoined from pursuing the Action against Highland, and (ii) the 

claims, to the extend valid, constitute post-petition administrative claims which Plaintiff, if it 

elects, can assert against Highland in the Bankruptcy Court pursuant to the procedure set forth in 

the Plan and Confirmation Order. 

1. Plaintiff Is Enjoined from Continuing the Action 

12. Pursuant to the Confirmation Order and the Plan, as of the Effective Date, Plaintiff 

is enjoined from conducting or continuing any suit or proceeding of any kind against Highland. 

See Docket No. 1943 (Confirmation Order) at 76-78 at 76-78 (Ex. 1, Appx. 77-79), and Ex. A 

(Plan) at 50-51 (Ex. 2, Appx. 219-220). 

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13. The parties are bound by the Confirmation Order. See U.S. v. Ramirez, 291 B.R. 

386, 392 (N.D. TX. 2002) (stating that a “confirmed Chapter 11 plan constitute[s] a binding 

contract”). Accordingly, this Court should enforce the Confirmation Order and dismiss this Action 

on the basis that the Confirmation Order prohibits the continuation of this Action in this Court. 

The Bankruptcy Court has jurisdiction over any claims against Highland. 

2. The Claims Asserted Should Be Adjudicated by the Bankruptcy Court 

 Pursuant to the Procedure for Asserting Administrative Claims in the Plan 

14. The claims asserted in the Action constitute alleged administrative claims that 

should be adjudicated in the Bankruptcy Court, if at all, and for this additional reason, dismissal 

of the Action is warranted. 

15. As noted supra, the Action arises from actions taken by Highland post-petition. 

The Action is nothing more than a request for payment of an unliquidated and disputed 

administrative claim which will be subject to allowance or disallowance under the Bankruptcy 

Code and in accordance with the Plan, and once paid or disallowed, will be discharged. A request 

for payment of an administrative claim is a core proceeding under 28 U.S.C. § 157(B)(2)(A) and 

(O), and arises in and under title 11. Thus, the Action is a post-petition claim, and should be filed 

as a request for an allowed administrative claim in the Bankruptcy Court in accordance with 

Bankruptcy Code section 503. See In re Endeavour Highrise L.P., 425 B.R. 402, 419 (Bankr. S.D. 

Tex. 2010) (“[A] party asserting a post-petition claim should file an application with the court and 

request an order establishing the claim as an allowed administrative claim or an allowed postpetition claim pursuant to a particular statute”). 

16. Article II of the Plan provides the methodology for the filing and allowance of 

administrative claims. A holder of a claim that arises post-petition files a request for payment of 

an administrative claim under section 503 of the Bankruptcy Code and such claim will be afforded 

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“administrative priority” if the claim arose post-petition and as a result of actions taken by the 

debtor that benefitted the estate. See Matter of Whistler Energy II, L.L.C., 931 F.3d 432, 441–42 

(5th Cir. 2019) (noting that administrative claims “under section 503(b)(1)(A) ... must have arisen 

post-petition and as a result of actions taken by the trustee [or debtor-in-possession] that benefitted 

the estate,” and an administrative priority claim “must have arisen from a transaction with the 

debtor in possession,” as opposed to the pre-petition debtor); In re Am. Plumbing & Mech., Inc., 

323 B.R. 442, 459 and n.23 (Bankr. W.D. Tex. 2005) citing Toma Steel Supply, Inc. v. 

TransAmerican Natural Gas Corp. (In Matter of TransAmerican Natural Gas Corp.), 978 F.2d 

1409, 1416 (5th Cir. 1992). 

17. In order to enforce the terms of the Plan and Confirmation Order, this Action should 

be dismissed so that Plaintiff, if it so chooses, can refile its claims with the Bankruptcy Court. 

CONCLUSION 

WHEREFORE, Highland respectfully requests that the Court (a) grant the Motion 

and dismiss the Action, and (b) grant such other and further relief as the Court deems just and 

proper. 

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Dated: October 5, 2021. PACHULSKI STANG ZIEHL & JONES LLP 

Jeffrey N. Pomerantz (CA Bar No. 143717) 

Robert J. Feinstein (NY Bar No. 1767805) 

John A. Morris (NY Bar No. 266326) 

Gregory V. Demo (NY Bar No. 5371992) 

Hayley R. Winograd (NY Bar No. 5612569) 

10100 Santa Monica Blvd., 13th Floor 

Los Angeles, CA 90067 

Telephone: (310) 277-6910 

Facsimile: (310) 201-0760 

Email: jpomerantz@pszjlaw.com 

 rfeinstein@pszjlaw.com 

 jmorris@pszjlaw.com 

 gdemo@pszjlaw.com 

 hwinograd@pszjlaw.com 

-andHAYWARD PLLC 

/s/ Zachery Z. Annable 

 Melissa S. Hayward 

Texas Bar No. 24044908 

MHayward@HaywardFirm.com 

Zachery Z. Annable 

Texas Bar No. 24053075 

ZAnnable@HaywardFirm.com 

10501 N. Central Expy, Ste. 106 

Dallas, Texas 75231 

Tel: (972) 755-7100 

Fax: (972) 755-7110 

Counsel for Highland Capital Management, L.P.

 

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CERTIFICATE OF SERVICE 

I hereby certify that, on October 5, 2021, a true and correct copy of the foregoing 

Memorandum of Law was served electronically upon all parties registered to receive electronic 

notice in this case via the Court’s CM/ECF system. 

/s/ Zachery Z. Annable

Zachery Z. Annable 

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001110

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PACHULSKI STANG ZIEHL & JONES LLP 

Jeffrey N. Pomerantz (CA Bar No. 143717) 

Robert J. Feinstein (NY Bar No. 1767805) 

John A. Morris (NY Bar No. 266326) 

Gregory V. Demo (NY Bar No. 5371992) 

Hayley R. Winograd (NY Bar No. 5612569) 

10100 Santa Monica Blvd., 13th Floor 

Los Angeles, CA 90067 

Telephone: (310) 277-6910 

Facsimile: (310) 201-0760 

Email: jpomerantz@pszjlaw.com 

 rfeinstein@pszjlaw.com 

 jmorris@pszjlaw.com 

 gdemo@pszjlaw.com 

 hwinograd@pszjlaw.com 

-andHAYWARD PLLC 

Melissa S. Hayward 

Texas Bar No. 24044908 

MHayward@HaywardFirm.com 

Zachery Z. Annable 

Texas Bar No. 24053075 

ZAnnable@HaywardFirm.com 

10501 N. Central Expy, Ste. 106 

Dallas, Texas 75231 

Tel: (972) 755-7100 

Fax: (972) 755-7110 

Counsel for Highland Capital Management, L.P.

IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF TEXAS 

DALLAS DIVISION 

THE CHARITABLE DAF FUND, L.P., 

 Plaintiff, 

vs. 

HIGHLAND CAPITAL MANAGEMENT, L.P., 

 Defendant. 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

§ 

Case No. 3:21-cv-01710-N 

APPENDIX IN SUPPORT OF HIGHLAND 

CAPITAL MANAGEMENT, L.P.’S MOTION TO DISMISS 

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001111

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Ex. Description Appx. # 

1. Order (i) Confirming the Fifth Amended Plan of Reorganization of 

Highland Capital Management, L.P. (as Modified) and (ii) Granting 

Related Relief, Case No. 19-34054-sgj, D.I. 1943 (Bankr. N.D. Tex. Feb. 

22, 2021) 

1-162 

2. Fifth Amended Plan of Reorganization of Highland Capital Management, 

L.P. (as Modified), Case No. 19-34054-sgj, D.I. 1808 (Bankr. N.D. Tex. 

Jan. 22, 2021) 

163-229 

3. Notice of Occurrence of Effective Date of Confirmed Fifth Amended Plan 

of Reorganization of Highland Capital Management, L.P., Case No. 19-

34054-sgj, D.I. 2700 (Bankr. N.D. Tex. Aug. 11, 2021) 

230-234 

[Remainder of Page Intentionally Blank] 

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001112

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Dated: October 5, 2021. PACHULSKI STANG ZIEHL & JONES LLP 

Jeffrey N. Pomerantz (CA Bar No. 143717) 

Ira D. Kharasch (CA Bar No. 109084) 

John A. Morris (NY Bar No. 266326) 

Gregory V. Demo (NY Bar No. 5371992) 

Hayley R. Winograd (NY Bar No. 5612569) 

10100 Santa Monica Blvd., 13th Floor 

Los Angeles, CA 90067 

Telephone: (310) 277-6910 

Facsimile: (310) 201-0760 

Email: jpomerantz@pszjlaw.com 

 ikharasch@pszjlaw.com 

 jmorris@pszjlaw.com 

 gdemo@pszjlaw.com 

 hwinograd@pszjlaw.com 

-andHAYWARD PLLC

/s/ Zachery Z. Annable 

 Melissa S. Hayward 

Texas Bar No. 24044908 

MHayward@HaywardFirm.com 

Zachery Z. Annable 

Texas Bar No. 24053075 

ZAnnable@HaywardFirm.com 

10501 N. Central Expy, Ste. 106 

Dallas, Texas 75231 

Tel: (972) 755-7100 

Fax: (972) 755-7110 

Counsel for Highland Capital Management, L.P.

 

 

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CERTIFICATE OF SERVICE 

I hereby certify that, on October 5, 2021, a true and correct copy of the foregoing Appendix 

was served electronically upon all parties registered to receive electronic notice in this case via the 

Court’s CM/ECF system. 

/s/ Zachery Z. Annable

Zachery Z. Annable 

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001114

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EXHIBIT 

Appx. 0001

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Exhibit 1 Page 1 of 162

001115

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DOCS_SF:104487.21 36027/002

IN THE UNITED STATES BANKRUPTCY COURT 

FOR THE NORTHERN DISTRICT OF TEXAS 

DALLAS DIVISION 

In re: 

HIGHLAND CAPITAL MANAGEMENT, L.P.,1

Debtor. 

) 

) 

) 

) 

) 

) 

Chapter 11 

Case No. 19-34054-sgj11 

ORDER (I) CONFIRMING THE FIFTH AMENDED 

PLAN OF REORGANIZATION OF HIGHLAND CAPITAL 

MANAGEMENT, L.P. (AS MODIFIED) AND (II) GRANTING RELATED RELIEF 

The Bankruptcy Court2

 having: 

a. entered, on November 24, 2020, the Order (A) Approving the Adequacy of the 

Disclosure Statement, (B) Scheduling A Hearing to Confirm the Fifth Amended 

Plan of Reorganization (C) Establishing Deadline for Filing Objections to 

Confirmation of Plan, (D) Approving Form of Ballots, Voting Deadline and 

Solicitation Procedures, and (E) Approving Form and Manner of Notice [Docket 

No. 1476] (the “Disclosure Statement Order”), pursuant to which the Bankruptcy 

Court approved the adequacy of the Disclosure Statement Relating to the Fifth 

1

 The Debtor’s last four digits of its taxpayer identification number are (6725). The headquarters and service address 

for the above-captioned Debtor is 300 Crescent Court, Suite 700, Dallas, TX 75201. 

2

 Capitalized terms used but not otherwise defined herein have the meanings given to them in the Plan (as defined 

below). The rules of interpretation set forth in Article I of the Plan apply to this Confirmation Order. 

______________________________________________________________________

Signed February 22, 2021

The following constitutes the ruling of the court and has the force and effect therein described.

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Appx. 0002

 ̈1¤}HV5"6 2R«

1934054210222000000000018

Docket #1943 Date Filed: 02/22/2021

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001116

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Amended Plan of Reorganization of Highland Capital Management, L.P. [Docket 

No. 1473] (the “Disclosure Statement”) under section 1125 of the Bankruptcy Code 

and authorized solicitation of the Disclosure Statement; 

b. set January 5, 2021, at 5:00 p.m. prevailing Central Time (the “Objection 

Deadline”), as the deadline for filing objections to confirmation of the Fifth 

Amended Plan of Reorganization of Highland Capital Management, L.P. (As 

Modified) [Docket No. 1808] (as amended, supplemented or modified, the “Plan”); 

c. set January 5, 2021, at 5:00 p.m. prevailing Central Time, as the deadline for voting 

on the Plan (the “Voting Deadline”) in accordance with the Disclosure Statement 

Order; 

d. initially set January 13, 2021, at 9:30 a.m. prevailing Central Time, as the date and 

time to commence the hearing to consider confirmation of the Plan pursuant to 

Bankruptcy Rules 3017 and 3018, sections 1126, 1128, and 1129 of the Bankruptcy 

Code, and the Disclosure Statement Order, which hearing was continued to January 

26, 2021, at 9:30 a.m. prevailing Central Time and further continued to February 2, 

2021; 

e. reviewed: (i) the Plan; (ii) the Disclosure Statement; and (iii) Notice of (I) Entry of 

Order Approving Disclosure Statement; (II) Hearing to Confirm; and (III) Related 

Important Dates (the “Confirmation Hearing Notice”), the form of which is 

attached as Exhibit 1-B to the Disclosure Statement Order; 

f. reviewed: (i) the Debtor’s Notice of Filing of Plan Supplement for the Third 

Amended Plan of Reorganization of Highland Capital Management, L.P. [Docket 

No. 1389] filed November 13, 2020; (ii) Debtor’s Notice of Filing of Plan 

Supplement for the Fifth Amended Plan of Reorganization of Highland Capital 

Management, L.P. [Docket No. 1606] filed on December 18, 2020; (iii) the 

Debtor’s Notice of Filing of Plan Supplement for the Fifth Amended Plan of 

Reorganization of Highland Capital Management, L.P. [Docket No. 1656] filed on 

January 4, 2021; (iv) Notice of Filing Plan Supplement to the Fifth Amended Plan 

of Reorganization of Highland Capital Management, L.P. (with Technical 

Modifications)t dated January 22, 2021 [Docket No. 1811]; and (v) Debtor’s Notice 

of Filing of Plan Supplement to the Fifth Amended Plan of Reorganization of 

Highland of Highland Capital Management, L.P. (As Modified) on February 1, 

2021 [Docket No. 1875]; (collectively, the documents listed in (i) through (v) of 

this paragraph, the “Plan Supplements”); 

g. reviewed: (i) the Notice of (I) Executory Contracts and Unexpired Leases to be 

Assumed by the Debtor Pursuant to the Fifth Amended Plan, (II) Cure Amounts, if 

Any, and (III) Related Procedures in Connection Therewith filed on December 30, 

2020 [Docket No. 1648]; (ii) the Second Notice of (I) Executory Contracts and 

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Unexpired Leases to be Assumed by the Debtor Pursuant to the Fifth Amended 

Plan, (II) Cure Amounts, if Any, and (III) Related Procedures in Connection 

Therewith filed on January 11, 2021 [Docket No.1719]; (iii) the Third Notice of 

(I) Executory Contracts and Unexpired Leases to be Assumed by the Debtor 

Pursuant to the Fifth Amended Plan, (II) Cure Amounts, if Any, and (III) Related 

Procedures in Connection Therewith filed on January 15, 2021 [Docket No. 1749]; 

(iv) the Notice of Withdrawal of Certain Executory Contracts and Unexpired 

Leases from List of Executory Contracts and Unexpired Leases to be Assumed by 

the Debtor Pursuant to the Fifth Amended Plan [Docket No. 1791]; (v) the Fourth 

Notice of (I) Executory Contracts and Unexpired Leases to be Assumed by the 

Debtor Pursuant to the Fifth Amended Plan (II) Cure Amounts, if Any, and (III) 

Released Procedures in Connection Therewith filed on January 27, 2021 [Docket 

No. 1847]; (vi) the Notice of Hearing on Agreed Motion to (I) Assume 

Nonresidential Real Property Lease with Crescent TC Investors, L.P. Upon 

Confirmation of Plan and (II) Extend Assumption Deadline filed on January 28, 

2021 [Docket No. 1857]; and (vii) the Fifth Notice of (I) Executory Contracts and 

Unexpired Leases to be Assumed by the Debtor Pursuant to the Fifth Amended Plan 

(II) Cure Amounts, if Any, and (III) Released Procedures in Connection Therewith

filed on February 1, 2021 [Docket No. 1873] (collectively, the documents referred 

to in (i) to (vii) are referred to as “List of Assumed Contracts”); 

h. reviewed: (i) the Debtor’s Memorandum of Law in Support of Confirmation of the 

Fifth Amended Plan of Reorganization of Highland Capital Management, L.P. 

[Docket No. 1814] (the “Confirmation Brief”); (ii) the Debtor’s Omnibus Reply to 

Objections to Confirmation of the Fifth Amended Chapter 11 Plan of 

Reorganization of Highland Capital Management; [Docket No. 1807]; and (iii) the 

Certification of Patrick M. Leathem With Respect to the Tabulation of Votes on the 

Fifth Amended Plan of Reorganization of Highland Capital Management, L.P.

[Docket No. 1772] and Supplemental Certification of Patrick M. Leathem With 

Respect to the Tabulation of Votes on the Fifth Amended Plan of Reorganization of 

Highland Capital Management, L.P. [Docket No. 1887] filed on February 3, 2021 

(together, the “Voting Certifications”). 

i. reviewed: (i) the Notice of Affidavit of Publication dated December 3, 2020 [Docket 

No. 1505]; (ii) the Certificate of Service dated December 23, 2020 [Docket No. 

1630]; (iii) the Supplemental Certificate of Service dated December 24, 2020 

[Docket No. 1637]; (iv) the Second Supplemental Certificate of Service dated 

December 31, 2020 [Docket No. 1653]; (v) the Certificate of Service dated 

December 23, 2020 [Docket No. 1627]; (vi) the Certificate of Service dated January 

6, 2021 [Docket No. 1696]; (vii) the Certificate of Service dated January 7, 2021 

[Docket No. 1699]; (viii) the Certificate of Service dated January 7, 2021 [Docket 

No 1700]; (ix) the Certificate of Service dated January 15, 2021 [Docket No. 1761]; 

(x) the Certificate of Service dated January 19, 2021 [Docket No. 1775]; (xi) the 

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Certificate of Service dated January 20, 2021 [Docket No. 1787]; (xii) the 

Certificate of Service dated January 26, 2021[Docket No. 1844]; (xiii) the 

Certificate of Service dated January 27, 2021 [Docket No. 1854]; (xiv) the 

Certificate of Service dated February 1, 2021 [Docket No. 1879]; (xv) the 

Certificates of Service dated February 3, 2021 [Docket No. 1891 and 1893]; and 

(xvi) the Certificates of Service dated February 5, 2021 [Docket Nos. 1906, 1907, 

1908 and 1909] (collectively, the “Affidavits of Service and Publication”); 

j. reviewed all filed3 pleadings, exhibits, statements, and comments regarding 

approval of the Disclosure Statement and confirmation of the Plan, including all 

objections, statements, and reservations of rights; 

k. conducted a hearing to consider confirmation of the Plan, which commenced on 

February 2, 2021, at 9:30 a.m. prevailing Central Time and concluded on February 

3, 2021, and issued its oral ruling on February 8, 2021 (collectively, the 

“Confirmation Hearing); 

l. heard the statements and arguments made by counsel in respect of confirmation of 

the Plan and having considered the record of this Chapter 11 Case and taken judicial 

notice of all papers and pleadings filed in this Chapter 11 Case; and 

m. considered all oral representations, testimony, documents, filings, and other 

evidence regarding confirmation of the Plan, including (a) all of the exhibits 

admitted into evidence;4

 (b) the sworn testimony of (i) James P. Seery, Jr., the 

Debtor’s Chief Executive Officer and Chief Restructuring Officer and a member of 

the Board of Directors of Strand Advisors, Inc. (“Strand”), the Debtor’s general 

partner; (ii) John S. Dubel, a member of the Board of Strand; (iii) Marc Tauber, a 

Vice President at Aon Financial Services; and (iv) Robert Jason Post, the Chief 

Compliance Officer of NexPoint Advisors, LP (collectively, the “Witnesses”); (c) 

the credibility of the Witnesses; and (d) the Voting Certifications. 

NOW, THEREFORE, after due deliberation thereon and good cause appearing therefor, 

the Bankruptcy Court hereby makes and issues the following findings of fact and conclusions of 

law: 

3

 Unless otherwise indicated, use of the term “filed” herein refers also to the service of the applicable document filed 

on the docket in this Chapter 11 Case, as applicable. 

4

 The Court admitted the following exhibits into evidence: (a) all of the Debtor’s exhibits lodged at Docket No. 1822 

(except TTTTT, which was withdrawn by the Debtor); (b) all of the Debtor’s exhibits lodged at Docket No. 1866; (c) 

all of the Debtor’s exhibits lodged at Docket No. 1877; (d) all of the Debtor’s exhibits lodged at Docket No. 1895; 

and (e) Exhibits 6-12 and 15-17 offered by Mr. James Dondero and lodged at Docket No. 1874. 

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Appx. 0005

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001119

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FINDINGS OF FACT AND CONCLUSIONS OF LAW 

1. Findings of Fact and Conclusions of Law. The findings and conclusions 

set forth herein, together with the findings of fact and conclusions of law set forth in the record 

during the Confirmation Hearing, constitute the Bankruptcy Court’s findings of fact and 

conclusions of law pursuant to Federal Rule of Civil Procedure 52, made applicable to this 

proceeding pursuant to Bankruptcy Rules 7052 and 9014. To the extent any of the following 

findings of fact constitute conclusions of law, they are adopted as such. To the extent that any of 

the following conclusions of law constitute findings of fact, they are adopted as such. 

2. Introduction and Summary of the Plan. Prior to addressing the specific 

requirements under the Bankruptcy Code and Bankruptcy Rules with respect to the confirmation 

of the Plan, the Bankruptcy Court believes it would be useful to first provide the following 

background of the Debtor’s Chapter 11 Case, the parties involved therewith, and some of the major 

events that have transpired culminating in the filing and solicitation of the Plan of this very unusual 

case. Before the Bankruptcy Court is the Debtor’s Fifth Amended Plan of Reorganization of 

Highland Capital Management, L.P., filed on November 24, 2020, as modified on January 22, 

2021 and again on February 1, 2021. The parties have repeatedly referred to the Plan as an “asset 

monetization plan” because it involves the orderly wind-down of the Debtor’s estate, including the 

sale of assets and certain of its funds over time, with the Reorganized Debtor continuing to manage 

certain other funds, subject to the oversight of the Claimant Trust Oversight Board. The Plan 

provides for a Claimant Trust to, among other things, manage and monetize the Claimant Trust 

Assets for the benefit of the Debtor’s economic stakeholders. The Claimant Trustee is responsible 

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001120

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for this process, among other duties specified in the Plan’s Claimant Trust Agreement. There is 

also anticipated to be a Litigation Sub-trust established for the purpose of pursuing certain 

avoidance or other causes of action for the benefit of the Debtor’s economic constituents. 

3. Confirmation Requirements Satisfied. The Plan is supported by the 

Committee and all claimants with Convenience Claims (i.e., general unsecured claims under $1 

million) who voted in Class 7. Claimants with Class 8 General Unsecured Claims, however, voted 

to reject the Plan because, although the Plan was accepted by 99.8% of the amount of Claims in 

that class, only 17 claimants voted to accept the Plan while 27 claimants voted to reject the Plan. 

As a result of such votes, and because Mr. Dondero and the Dondero Related Entities (as defined 

below) objected to the Plan on a variety of grounds primarily relating to the Plan’s release, 

exculpation and injunction provisions, the Bankruptcy Court heard two full days of evidence on 

February 2 and 3, 2021, and considered testimony from five witnesses and thousands of pages of 

documentary evidence in determining whether the Plan satisfies the confirmation standards 

required under the Bankruptcy Code. The Bankruptcy Court finds and concludes that the Plan 

meets all of the relevant requirements of sections 1123, 1124, and 1129, and other applicable 

provisions of the Bankruptcy Code, as more fully set forth below with respect to each of the 

applicable confirmation requirements. 

4. Not Your Garden Variety Debtor. The Debtor’s case is not a garden 

variety chapter 11 case. The Debtor is a multibillion-dollar global investment adviser registered 

with the SEC, pursuant to the Investment Advisers Act of 1940. It was founded in 1993 by James 

Dondero and Mark Okada. Mark Okada resigned from his role with Highland prior to the 

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Exhibit 1 Page 7 of 162

001121

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bankruptcy case being filed on October 16, 2019 (the “Petition Date”). Mr. Dondero controlled 

the Debtor as of the Petition Date but agreed to relinquish control of it on or about January 9, 2020, 

pursuant to an agreement reached with the Committee, as described below. Although Mr. Dondero 

remained with the Debtor as an unpaid employee/portfolio manager after January 9, 2020, his 

employment with the Debtor terminated on October 9, 2020. Mr. Dondero continues to work for 

and/or control numerous non-debtor entities in the complex Highland enterprise. 

5. The Debtor. The Debtor is headquartered in Dallas, Texas. As of the 

Petition Date, the Debtor employed approximately 76 employees. The Debtor is privately-owned: 

(a) 99.5% by the Hunter Mountain Investment Trust; (b) 0.1866% by The Dugaboy Investment 

Trust, a trust created to manage the assets of Mr. Dondero and his family; (c) 0.0627% by Mark 

Okada, personally and through family trusts; and (d) 0.25% by Strand, the Debtor’s general 

partner. 

6. The Highland Enterprise. Pursuant to various contractual arrangements, 

the Debtor provides money management and advisory services for billions of dollars of assets, 

including collateralized loan obligation vehicles (“CLOs”), and other investments. Some of these 

assets are managed by the Debtor pursuant to shared services agreements with certain affiliated 

entities, including other affiliated registered investment advisors. In fact, there are approximately 

2,000 entities in the byzantine complex of entities under the Highland umbrella. None of these 

affiliated entities filed for chapter 11 protection. Most, but not all, of these entities are not 

subsidiaries (direct or indirect) of the Debtor. Many of the Debtor’s affiliated companies are 

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offshore entities, organized in jurisdictions such as the Cayman Islands and Guernsey. See 

Disclosure Statement, at 17-18. 

7. Debtor’s Operational History. The Debtor’s primary means of generating 

revenue has historically been from fees collected for the management and advisory services 

provided to funds that it manages, plus fees generated for services provided to its affiliates. For 

additional liquidity, the Debtor, prior to the Petition Date, would sell liquid securities in the 

ordinary course, primarily through a brokerage account at Jefferies, LLC. The Debtor would also, 

from time to time, sell assets at non-Debtor subsidiaries and cause those proceeds to be distributed 

to the Debtor in the ordinary course of business. The Debtor’s current Chief Executive Officer, 

James P. Seery, Jr., credibly testified at the Confirmation Hearing that the Debtor was “run at a 

deficit for a long time and then would sell assets or defer employee compensation to cover its 

deficits.” The Bankruptcy Court cannot help but wonder if that was necessitated because of 

enormous litigation fees and expenses incurred by the Debtor due to its culture of litigation—as 

further addressed below. 

8. Not Your Garden Variety Creditor’s Committee. The Debtor and this 

chapter 11 case are not garden variety for so many reasons. One of the most obvious standouts in 

this case is the creditor constituency. The Debtor did not file for bankruptcy because of any of the 

typical reasons that large companies file chapter 11. For example, the Debtor did not have a large, 

asset-based secured lender with whom it was in default; it only had relatively insignificant secured 

indebtedness owing to Jeffries, with whom it had a brokerage account, and one other entity, 

Frontier State Bank. The Debtor also did not have problems with its trade vendors or landlords. 

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The Debtor also did not suffer any type of catastrophic business calamity. In fact, the Debtor filed 

for Chapter 11 protection six months before the onset of the COVID-19 pandemic. Rather, the 

Debtor filed for Chapter 11 protection due to a myriad of massive, unrelated, business litigation 

claims that it faced—many of which had finally become liquidated (or were about to become 

liquidated) after a decade or more of contentious litigation in multiple forums all over the world. 

The Committee in this case has referred to the Debtor—under its former chief executive, Mr. 

Dondero—as a “serial litigator.” The Bankruptcy Court agrees with that description. By way of 

example, the members of the Committee (and their history of litigation with the Debtor and others 

in the Highland complex) are as follows: 

a. The Redeemer Committee of the Highland Crusader Fund (the “Redeemer 

Committee”). This Committee member obtained an arbitration award against the 

Debtor in the amount of $190,824,557, inclusive of interest, approximately five 

months before the Petition Date, from a panel of the American Arbitration 

Association. It was on the verge of having that award confirmed by the Delaware 

Chancery Court immediately prior to the Petition Date, after years of disputes that 

started in late 2008 (and included legal proceedings in Bermuda). This creditor’s 

claim was settled during this Chapter 11 Case in the amount of approximately 

$137,696,610 (subject to other adjustments and details not relevant for this 

purpose). 

b. Acis Capital Management, L.P., and Acis Capital Management GP, LLC 

(“Acis”). Acis was formerly in the Highland complex of companies, but was not 

affiliated with Highland as of the Petition Date. This Committee member and its 

now-owner, Joshua Terry, were involved in litigation with the Debtor dating back 

to 2016. Acis was forced by Mr. Terry (who was a former Highland portfolio 

manager) into an involuntary chapter 11 bankruptcy in the Bankruptcy Court for 

the Northern District of Texas, Dallas Division before the Bankruptcy Court in 

2018, after Mr. Terry obtained an approximately $8 million arbitration award and 

judgment against Acis. Mr. Terry ultimately was awarded the equity ownership of 

Acis by the Bankruptcy Court in the Acis bankruptcy case. Acis subsequently 

asserted a multi-million dollar claim against Highland in the Bankruptcy Court for 

Highland’s alleged denuding of Acis to defraud its creditors—primarily Mr. Terry. 

The litigation involving Acis and Mr. Terry dates back to mid-2016 and has 

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continued on with numerous appeals of Bankruptcy Court orders, including one 

appeal still pending at the Fifth Circuit Court of Appeals. There was also litigation 

involving Mr. Terry and Acis in the Royal Court of the Island of Guernsey and in 

a state court in New York. The Acis claim was settled during this Chapter 11 Case, 

in Bankruptcy Court-ordered mediation, for approximately $23 million (subject to 

other details not relevant for this purpose), and is the subject of an appeal being 

pursued by Mr. Dondero. 

c. UBS Securities LLC and UBS AG London Branch (“UBS”). UBS is a 

Committee member that filed a proof of claim in the amount of $1,039,957,799.40 

in this Chapter 11 Case. The UBS Claim was based on a judgment that UBS 

received from a New York state court in 2020. The underlying decision was issued 

in November 2019, after a multi-week bench trial (which had occurred many 

months earlier) on a breach of contract claim against non-Debtor entities in the 

Highland complex. The UBS litigation related to activities that occurred in 2008 

and 2009. The litigation involving UBS and Highland and affiliates was pending 

for more than a decade (there having been numerous interlocutory appeals during 

its history). The Debtor and UBS recently announced an agreement in principle for 

a settlement of the UBS claim (which came a few months after Bankruptcy Courtordered mediation) which will be subject to a 9019 motion to be filed with the 

Bankruptcy Court on a future date. 

d. Meta-E Discovery (“Meta-E”). Meta-E is a Committee member that is a vendor 

who happened to supply litigation and discovery-related services to the Debtor over 

the years. It had unpaid invoices on the Petition Date of more than $779,000. 

It is fair to say that the members of the Committee in this case all have wills of steel. They fought 

hard before and during this Chapter 11 Case. The members of the Committee, all of whom have 

volunteered to serve on the Claimant Trust Oversight Board post-confirmation, are highly 

sophisticated and have had highly sophisticated professionals representing them. They have 

represented their constituency in this case as fiduciaries extremely well. 

9. Other Key Creditor Constituents. In addition to the Committee members 

who were all embroiled in years of litigation with Debtor and its affiliates in various ways, the 

Debtor has been in litigation with Patrick Daugherty, a former limited partner and employee of the 

Debtor, for many years in both Delaware and Texas state courts. Mr. Daugherty filed an amended 

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proof of claim in this Chapter 11 Case for $40,710,819.42 relating to alleged breaches of 

employment-related agreements and for defamation arising from a 2017 press release posted by 

the Debtor. The Debtor and Mr. Daugherty recently announced a settlement of Mr. Daugherty’s 

claim pursuant to which he will receive $750,000 in cash on the Effective Date of the Plan, an 

$8.25 million general unsecured claim, and a $2.75 million subordinated claim (subject to other 

details not relevant for this purpose). Additionally, entities collectively known as “HarbourVest” 

invested more than $70 million with an entity in the Highland complex and asserted a $300 million 

proof of claim against the Debtor in this case, alleging, among other things, fraud and RICO 

violations. HarbourVest’s claim was settled during the bankruptcy case for a $45 million general 

unsecured claim and a $35 million subordinated claim, and that settlement is also being appealed 

by a Dondero Entity. 

10. Other Claims Asserted. Other than the Claims just described, most of the 

other Claims in this Chapter 11 Case are Claims asserted against the Debtor by: (a) entities in the 

Highland complex—most of which entities the Bankruptcy Court finds to be controlled by Mr. 

Dondero; (b) employees who contend that are entitled to large bonuses or other types of deferred 

compensation; and (c) numerous law firms that worked for the Debtor prior to the Petition Date 

and had outstanding amounts due for their prepetition services.

11. Not Your Garden Variety Post-Petition Corporate Governance 

Structure. Yet another reason this is not your garden variety chapter 11 case is its post-petition 

corporate governance structure. Immediately from its appointment, the Committee’s relationship 

with the Debtor was contentious at best. First, the Committee moved for a change of venue from 

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Delaware to Dallas. Second, the Committee (and later, the United States Trustee) expressed its 

then-desire for the appointment of a chapter 11 trustee due to its concerns over and distrust of Mr. 

Dondero, his numerous conflicts of interest, and his history of alleged mismanagement (and 

perhaps worse). 

12. Post-Petition Corporate Governance Settlement with Committee. After 

spending many weeks under the threat of the potential appointment of a trustee, the Debtor and 

Committee engaged in substantial and lengthy negotiations resulting in a corporate governance 

settlement approved by the Bankruptcy Court on January 9, 2020.5

 As a result of this settlement, 

among other things, Mr. Dondero relinquished control of the Debtor and resigned his positions as 

an officer or director of the Debtor and its general partner, Strand. As noted above, Mr. Dondero 

agreed to this settlement pursuant a stipulation he executed,6

 and he also agreed not to cause any 

Related Entity (as defined in the Settlement Motion) to terminate any agreements with the Debtor. 

The January 9 Order also (a) required that the Bankruptcy Court serve as “gatekeeper” prior to the 

commencement of any litigation against the three independent board members appointed to 

oversee and lead the Debtor’s restructuring in lieu of Mr. Dondero and (b) provided for the 

exculpation of those board members by limiting claims subject to the “gatekeeper” provision to 

those alleging willful misconduct and gross negligence. 

5

 This order is hereinafter referred to as the “January 9 Order” and was entered by the Court on January 9, 2020 

[Docket No. 339] pursuant to the Motion of the Debtor to Approve Settlement with Official Committee of Unsecured 

Creditors Regarding the Governance of the Debtor and Procedures for Operation in the Ordinary Course [Docket 

No. 281] (the “Settlement Motion”). 

6 See Stipulation in Support of Motion of the Debtor for Approval of Settlement With the Official Committee of 

Unsecured Creditors Regarding Governance of the Debtor and Procedures for Operations in Ordinary Course

[Docket No. 338] (the “Stipulation”). 

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13. Appointment of Independent Directors. As part of the Bankruptcy 

Court-approved settlement, three eminently qualified independent directors were chosen to lead 

Highland through its Chapter 11 Case. They are: James P. Seery, Jr., John S. Dubel (each chosen 

by the Committee), and Retired Bankruptcy Judge Russell Nelms. These three individuals are 

each technically independent directors of Strand (Mr. Dondero had previously been the sole 

director of Strand and, thus, the sole person in ultimate control of the Debtor). The three 

independent board members’ resumes are in evidence. The Bankruptcy Court later approved Mr. 

Seery’s appointment as the Debtor’s Chief Executive Officer, Chief Restructuring Officer, and 

Foreign Representative. Suffice it to say that this settlement and the appointment of the 

independent directors changed the entire trajectory of the case and saved the Debtor from the 

appointment of a trustee. The Bankruptcy Court and the Committee each trusted the independent 

directors. They were the right solution at the right time. Because of the unique character of the 

Debtor’s business, the Bankruptcy Court believed the appointment of three qualified independent 

directors was a far better outcome for creditors than the appointment of a conventional chapter 11 

trustee. Each of the independent directors brought unique qualities to the table. Mr. Seery, in 

particular, knew and had vast experience at prominent firms with high-yield and distressed 

investing similar to the Debtor’s business. Mr. Dubel had 40 years of experience restructuring 

large complex businesses and serving on boards in this context. And Retired Judge Nelms had not 

only vast bankruptcy experience but seemed particularly well-suited to help the Debtor maneuver 

through conflicts and ethical quandaries. By way of comparison, in the chapter 11 case of Acis, 

the former affiliate of Highland that the Bankruptcy Court presided over and which company was 

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much smaller in size and scope than Highland (managing only 5-6 CLOs), the creditors elected a 

chapter 11 trustee who was not on the normal trustee rotation panel in this district but, rather, was 

a nationally known bankruptcy attorney with more than 45 years of large chapter 11 experience. 

While the Acis chapter 11 trustee performed valiantly, he was sued by entities in the Highland 

complex shortly after he was appointed (which the Bankruptcy Court had to address). The Acis 

trustee was also unable to persuade the Debtor and its affiliates to agree to any actions taken in the 

case, and he finally obtained confirmation of Acis’ chapter 11 plan over the objections of the 

Debtor and its affiliates on his fourth attempt (which confirmation was promptly appealed). 

14. Conditions Required by Independent Directors. Given the experiences 

in Acis and the Debtor’s culture of constant litigation, it was not as easy to get such highly qualified 

persons to serve as independent board members and, later, as the Debtor’s Chief Executive Officer, 

as it would be in an ordinary chapter 11 case. The independent board members were stepping into 

a morass of problems. Naturally, they were worried about getting sued no matter how defensible 

their efforts—given the litigation culture that enveloped Highland historically. Based on the 

record of this Case and the proceedings in the Acis chapter 11 case, it seemed as though everything 

always ended in litigation at Highland. The Bankruptcy Court heard credible testimony that none 

of the independent directors would have taken on the role of independent director without (1) an 

adequate directors and officers’ (“D&O”) insurance policy protecting them; (2) indemnification 

from Strand that would be guaranteed by the Debtor; (3) exculpation for mere negligence claims; 

and (4) a gatekeeper provision prohibiting the commencement of litigation against the independent 

directors without the Bankruptcy Court’s prior authority. This gatekeeper provision was also 

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included in the Bankruptcy Court’s order authorizing the appointment of Mr. Seery as the Debtor’s 

Chief Executive Officer, Chief Restructuring Officer, and Foreign Representative entered on 

July 16, 2020.7

 The gatekeeper provisions in both the January 9 Order and July 16 Order are 

precisely analogous to what bankruptcy trustees have pursuant to the so-called “Barton Doctrine” 

(first articulated in an old Supreme Court case captioned Barton v. Barbour, 104 U.S. 126 (1881)). 

The Bankruptcy Court approved all of these protections in the January 9 Order and the July 16 

Order, and no one appealed either of those orders. As noted above, Mr. Dondero signed the 

Stipulation that led to the settlement that was approved by the January 9 Order. The Bankruptcy 

Court finds that, like the Committee, the independent board members have been resilient and 

unwavering in their efforts to get the enormous problems in this case solved. They seem to have 

at all times negotiated hard and in good faith, which culminated in the proposal of the Plan 

currently before the Bankruptcy Court. As noted previously, they completely changed the 

trajectory of this case. 

15. Not Your Garden Variety Mediators. And still another reason why this 

was not your garden variety case was the mediation effort. In the summer of 2020, roughly nine 

months into the chapter 11 case, the Bankruptcy Court ordered mediation among the Debtor, Acis, 

UBS, the Redeemer Committee, and Mr. Dondero. The Bankruptcy Court selected co-mediators 

because mediation among these parties seemed like such a Herculean task—especially during 

COVID-19 where people could not all be in the same room. Those co-mediators were: Retired 

7 See Order Approving the Debtor’s Motion Under Bankruptcy Code Sections 105(a) and 363(b) Authorizing 

Retention of James P. Seery, Jr., as Chief Executive Officer, Chief Restructuring Officer, and Foreign Representative 

Nunc Pro Tunc to March 15, 2020 [Docket No. 854] entered on July 16, 2020 (the “July 16 Order”) 

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Bankruptcy Judge Alan Gropper from the Southern District of New York, who had a distinguished 

career presiding over complex chapter 11 cases, and Ms. Sylvia Mayer, who likewise has had a 

distinguished career, first as a partner at a preeminent law firm working on complex chapter 11 

cases, and subsequently as a mediator and arbitrator in Houston, Texas. As noted earlier, the 

Redeemer Committee and Acis claims were settled during the mediation—which seemed nothing 

short of a miracle to the Bankruptcy Court—and the UBS claim was settled several months later 

and the Bankruptcy Court believes the ground work for that ultimate settlement was laid, or at 

least helped, through the mediation. And, as earlier noted, other significant claims have been 

settled during this case, including those of HarbourVest (who asserted a $300 million claim) and 

Patrick Daugherty (who asserted a $40 million claim). The Bankruptcy Court cannot stress 

strongly enough that the resolution of these enormous claims—and the acceptance by all of these 

creditors of the Plan that is now before the Bankruptcy Court—seems nothing short of a miracle. 

It was more than a year in the making. 

16. Not Your Garden Variety Plan Objectors (That Is, Those That 

Remain). Finally, a word about the current, remaining objectors to the Plan before the Bankruptcy 

Court. Once again, the Bankruptcy Court will use the phrase “not your garden variety”, which 

phrase applies to this case for many reasons. Originally, there were over a dozen objections filed 

to the Plan. The Debtor then made certain amendments or modifications to the Plan to address 

some of these objections, none of which require further solicitation of the Plan for reasons set forth 

in more detail below. The only objectors to the Plan left at the time of the Confirmation Hearing 

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were Mr. Dondero [Docket No. 1661] and entities that the Bankruptcy Court finds are owned 

and/or controlled by him and that filed the following objections: 

a. Objection to Confirmation of the Debtor’s Fifth Amended Plan of Reorganization

(filed by Get Good Trust and The Dugaboy Investment Trust) [Docket No. 1667]; 

b. Objection to Confirmation of Fifth Amended Plan of Reorganization of Highland 

Capital Management, L.P. (filed by Highland Capital Management Fund Advisors, 

L.P., Highland Fixed Income Fund, Highland Funds I and its series, Highland 

Funds II and its series, Highland Global Allocation Fund, Highland Healthcare 

Opportunities Fund, Highland Income Fund, Highland Merger Arbitrate Fund, 

Highland Opportunistic Credit Fund, Highland Small-Cap Equity Fund, Highland 

Socially Responsible Equity Fund, Highland Total Return Fund, Highland/iBoxx 

Senior Loan ETF, NexPoint Advisors, L.P., NexPoint Capital, Inc., NexPoint Real 

Estate Strategies Fund, NexPoint Strategic Opportunities Fund) [Docket No. 

1670]; 

c. A Joinder to the Objection filed at 1670 by: NexPoint Real Estate Finance Inc., 

NexPoint Real Estate Capital, LLC, NexPoint Residential Trust, Inc., NexPoint 

Hospitality Trust, NexPoint Real Estate Partners, LLC, NexPoint Multifamily 

Capital Trust, Inc., VineBrook Homes Trust, Inc., NexPoint Real Estate Advisors, 

L.P., NexPoint Real Estate Advisors II, L.P., NexPoint Real Estate Advisors III, 

L.P., NexPoint Real Estate Advisors IV, L.P., NexPoint Real Estate Advisors V, 

L.P., NexPoint Real Estate Advisors VI, L.P., NexPoint Real Estate Advisors VII, 

L.P., NexPoint Real Estate Advisors VIII, L.P., and any funds advised by the 

foregoing [Docket No. 1677]; 

d. NexPoint Real Estate Partners LLC’s Objection to Debtor’s Fifth Amended Plan 

of Reorganization (filed by NexPoint Real Estate Partners LLC f/k/a HCRE 

Partners LLC) [Docket No. 1673]; and 

e. NexBank’s Objection to Debtor’s Fifth Amended Plan of Reorganization (filed by 

NexBank Title, Inc., NexBank Securities, Inc., NexBank Capital, Inc., and 

NexBank) [Docket No. 1676]. The entities referred to in (i) through (v) of this 

paragraph are hereinafter referred to as the “Dondero Related Entities”). 

17. Questionability of Good Faith as to Outstanding Confirmation 

Objections. Mr. Dondero and the Dondero Related Entities technically have standing to object to 

the Plan, but the remoteness of their economic interests is noteworthy, and the Bankruptcy Court 

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questions the good faith of Mr. Dondero’s and the Dondero Related Entities’ objections. In fact, 

the Bankruptcy Court has good reason to believe that these parties are not objecting to protect 

economic interests they have in the Debtor but to be disruptors. Mr. Dondero wants his company 

back. This is understandable, but it is not a good faith basis to lob objections to the Plan. As 

detailed below, the Bankruptcy Court has slowed down plan confirmation multiple times and urged 

the parties to talk to Mr. Dondero in an attempt to arrive at what the parties have repeatedly referred 

to as a “grand bargain,” the ultimate goal to resolve the Debtor’s restructuring. The Debtor and 

the Committee represent that they have communicated with Mr. Dondero regarding a grand 

bargain settlement, and the Bankruptcy Court believes that they have. 

18. Remote Interest of Outstanding Confirmation Objectors. To be specific 

about the remoteness of Mr. Dondero’s and the Dondero Related Entities’ interests, the Bankruptcy 

Court will address them each separately. First, Mr. Dondero has a pending objection to the Plan. 

Mr. Dondero’s only economic interest with regard to the Debtor is an unliquidated indemnification 

claim (and, based on everything the Bankruptcy Court has heard, his indemnification claims would 

be highly questionable at this juncture). Mr. Dondero owns no equity in the Debtor directly. Mr. 

Dondero owns the Debtor’s general partner, Strand, which in turn owns a quarter percent of the 

total equity in the Debtor. Second, a joint objection has been filed by The Dugaboy Trust 

(“Dugaboy”) and the Get Good Trust (“Get Good”). The Dugaboy Trust was created to manage 

the assets of Mr. Dondero and his family and owns a 0.1866% limited partnership interest in the 

Debtor. See Disclosure Statement at 7, n.3. The Bankruptcy Court is not clear what economic 

interest the Get Good Trust has, but it likewise seems to be related to Mr. Dondero. Get Good 

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filed three proofs of claim relating to a pending federal tax audit of the Debtor’s 2008 return, which 

the Debtor believes arise from Get Good’s equity security interests and are subject to subordination 

as set forth in its Confirmation Brief. Dugaboy filed three claims against the Debtor: (a) an 

administrative claim relating to the Debtor’s alleged postpetition management of Multi-Strat 

Credit Fund, L.P., (b) a prepetition claim against a subsidiary of the Debtor for which it seeks to 

pierce the corporate veil, each of which the Debtor maintains are frivolous in the Confirmation 

Brief, and (c) a claim arising from its equity security interest in the Debtor, which the Debtor 

asserts should be subordinated. Another group of objectors that has joined together in one 

objection is what the Bankruptcy Court will refer to as the “Highland Advisors and Funds.” See

Docket No. 1863. The Bankruptcy Court understands they assert disputed administrative expense 

claims against the estate that were filed shortly before the Confirmation Hearing on January 23, 

2021 [Docket No. 1826], and during the Confirmation Hearing on February 3, 2021 [Docket No. 

1888]. At the Confirmation Hearing, Mr. Post testified on behalf of the Highland Advisors and 

Funds that the Funds have independent board members that run the Funds, but the Bankruptcy 

Court was not convinced of their independence from Mr. Dondero because none of the so-called 

independent board members have ever testified before the Bankruptcy Court and all have been 

engaged with the Highland complex for many years. Notably, the Court questions Mr. Post’s 

credibility because, after more than 12 years of service, he abruptly resigned from the Debtor in 

October 2020 at the exact same time that Mr. Dondero resigned at the Board of Directors’ request, 

and he is currently employed by Mr. Dondero. Moreover, Dustin Norris, a witness in a prior 

proceeding (whose testimony was made part of the record at the Confirmation Hearing), recently 

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testified on behalf of the Highland Advisors and Funds in another proceeding that Mr. Dondero 

owned and/or controlled these entities. Finally, various NexBank entities objected to the Plan. 

The Bankruptcy Court does not believe they have liquidated claims against the Debtor. Mr. 

Dondero appears to be in control of these entities as well. 

19. Background Regarding Dondero Objecting Parties. To be clear, the 

Bankruptcy Court has allowed all these objectors to fully present arguments and evidence in 

opposition to confirmation, even though their economic interests in the Debtor appear to be 

extremely remote and the Bankruptcy Court questions their good faith. Specifically, the 

Bankruptcy Court considers them all to be marching pursuant to the orders of Mr. Dondero. In 

the recent past, Mr. Dondero has been subject to a temporary restraining order and preliminary 

injunction by the Bankruptcy Court for interfering with Mr. Seery’s management of the Debtor in 

specific ways that were supported by evidence. Around the time that this all came to light and the 

Bankruptcy Court began setting hearings on the alleged interference, Mr. Dondero’s company 

phone, which he had been asked to turn in to Highland, mysteriously went missing. The 

Bankruptcy Court merely mentions this in this context as one of many reasons that the Bankruptcy 

Court has to question the good faith of Mr. Dondero and his affiliates in raising objections to 

confirmation of the Plan. 

20. Other Confirmation Objections. Other than the objections filed by Mr. 

Dondero and the Dondero Related Entities, the only other pending objection to the Plan is the 

United States Trustee’s Limited Objection to Confirmation of Debtor’s Fifth Amended Plan of 

Reorganization [Docket No. 1671], which objected to the Plan’s exculpation, injunction, and 

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Debtor release provisions. In juxtaposition, to these pending objections, the Bankruptcy Court 

notes that the Debtor resolved the following objections to the Plan: 

a. CLO Holdco, Ltd.’s Joinder to Objection to Confirmation of Fifth Amended Plan 

of Reorganization of Highland Capital Management, L.P. and Supplemental 

Objections to Plan Confirmation [Docket No. 1675]. This Objection has been 

resolved pursuant to mutually agreed language by the parties set forth in paragraph 

VV of the Confirmation Order; 

b. Objection of Dallas County, City of Allen, Allen ISD, City of Richardson, and 

Kaufman County to Confirmation of the Fifth Amended Plan of Reorganization of 

Highland Capital Management, L.P. [Docket No. 1662]. This Objection has been 

resolved pursuant to mutually agreed language by the parties set forth in paragraph 

QQ of the Confirmation Order; 

c. Senior Employees’ Limited Objection to Debtor’s Fifth Amended Plan of 

Reorganization (filed by Scott Ellington, Thomas Surgent, Frank Waterhouse, 

Isaac Leventon) [Docket No. 1669]. This Objection has been resolved pursuant to 

mutually agreed language by the parties set forth in paragraph 82 and paragraphs 

RR and SS of the Confirmation Order; 

d. Limited Objection of Jack Yang and Brad Borud to Fifth Amended Plan of 

Reorganization of Highland Capital Management, L.P. [Docket No. 1666] and the 

amended joinder filed by Davis Deadman, Paul Kauffman and Todd Travers 

[Docket No. 1679]. This Objection and the amended joinder were resolved by 

agreement of the parties pursuant to modifications to the Plan filed by the Debtor; 

e. United States’ (IRS) Limited Objection to Debtor’s Fifth Amended Plan of 

Reorganization [Docket No. 1668]. This Objection has been resolved pursuant to 

mutually agreed language by the parties set forth in paragraphs TT and UU of the 

Confirmation Order; and 

f. Patrick Hagaman Daugherty’s Objection to Confirmation of Fifth Amended Plan 

of Reorganization [Docket No. 1678]. This objection was resolved by the parties 

pursuant to the settlement of Mr. Daugherty’s claim announced on the record of the 

Confirmation Hearing. 

21. Capitalized Terms. Capitalized terms used herein, but not defined herein, 

shall have the respective meanings attributed to such terms in the Plan and the Disclosure 

Statement, as applicable. 

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22. Jurisdiction and Venue. The Bankruptcy Court has jurisdiction over the 

Debtor’s Chapter 11 Case pursuant to 28 U.S.C. §§ 157 and 1334. This is a core proceeding 

pursuant to 28 U.S.C. § 157(b)(2). Venue of this proceeding and this Chapter 11 Case is proper 

in this district and in the Bankruptcy Court pursuant to 28 U.S.C. §§ 1408 and 1409. 

23. Chapter 11 Petition. On the Petition Date, the Debtor commenced a 

voluntary case under chapter 11 of the Bankruptcy Code in the United States Bankruptcy Court 

for the District of Delaware, which case was transferred to the Bankruptcy Court on December 19, 

2019. The Debtor continues to operate its business and manage its property as debtor in possession 

pursuant to sections 1107(a) and 1108 of the Bankruptcy Code. No trustee or examiner has been 

appointed in this Chapter 11 Case. The Office of the United States Trustee appointed the 

Committee on October 29, 2019. 

24. Judicial Notice. The Bankruptcy Court takes judicial notice of the docket 

in this Chapter 11 Case maintained by the clerk of the Bankruptcy Court and the court-appointed 

claims agent, Kurtzman Carson Consultants LLC (“KCC”), including, without limitation, all 

pleadings, notices, and other documents filed, all orders entered, and all evidence and arguments 

made, proffered or adduced at the hearings held before the Bankruptcy Court during this Chapter 

11 Case, including, without limitation, the hearing to consider the adequacy of the Disclosure 

Statement and the Confirmation Hearing, as well as all pleadings, notices, and other documents 

filed, all orders entered, and all evidence and arguments made, proffered, or adduced at hearings 

held before the Bankruptcy Court or the District Court for the Northern District of Texas in 

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connection with an adversary proceeding or appellate proceeding, respectively, related to this 

Chapter 11 Case. 

25. Plan Supplement Documents. Prior to the Confirmation Hearing, the 

Debtor filed each of the Plan Supplements. The Plan Supplements contain, among other 

documents, the Retained Causes of Action, the Claimant Trust Agreement, the Litigation SubTrust Agreement, the Senior Employee Stipulation, the Related Entity List, the Schedule of 

Employees, the Reorganized Limited Partnership Agreement, supplements to the Liquidation 

Analysis/Financial Projections, the Schedule of Contracts and Leases to be Assumed, and the other 

Plan Documents set forth therein (collectively, the “Plan Supplement Documents”). 

26. Retained Causes of Action Adequately Preserved. The Bankruptcy 

Court finds that the list of Retained Causes of Action included in the Plan Supplements sufficiently 

describes all potential Retained Causes of Action, provides all persons with adequate notice of any 

Causes of Action regardless of whether any specific claim to be brought in the future is listed 

therein or whether any specific potential defendant or other party is listed therein, and satisfies 

applicable law in all respects to preserve all of the Retained Causes of Action. The definition of 

the Causes of Action and Schedule of Retained Causes of Action, and their inclusion in the Plan, 

specifically and unequivocally preserve the Causes of Action for the benefit of the Reorganized 

Debtor, the Claimant Trust, or the Litigation Sub-Trust, as applicable. 

27. Plan Modifications Are Non-Material. In addition to the Plan 

Supplements, the Debtor made certain non-material modifications to the Plan, which are reflected 

in (i) the Redline of Fifth Amended Plan of Reorganization of Highland Capital Management, L.P. 

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(as Modified) filed on January 22, 2021 [Docket No. 1809], and (ii) Exhibit B to the Debtor’s 

Notice of Filing of Plan Supplement to Fifth Amended Plan of Reorganization of Highland Capital 

Management, L.P. (as Modified) filed on February 1, 2021 [Docket No. 1875] (collectively, the 

“Plan Modifications”). Section 1127(a) of the Bankruptcy Code provides that a plan proponent 

may modify its plan at any time before confirmation so long as such modified plan meets the 

requirements of sections 1122 and 1123 of the Bankruptcy Code. None of the modifications set 

forth in the Plan Supplements or the Plan Modifications require any further solicitation pursuant 

to sections 1125, 1126, or 1127 of the Bankruptcy Code and Bankruptcy Rule 3019, because, 

among other things, they do not materially adversely change the treatment of the claims of any 

creditors or interest holders who have not accepted, in writing, such supplements and 

modifications. Among other things, there were changes to the projections that the Debtor filed 

shortly before the Confirmation Hearing (which included projected distributions to creditors and 

a comparison of projected distributions under the Plan to potential distributions under a 

hypothetical chapter 7 liquidation). The Plan Supplements and Plan Modifications did not mislead 

or prejudice any creditors or interest holders nor do they require that Holders of Claims or Equity 

Interests be afforded an opportunity to change previously cast votes to accept or reject the Plan. 

Specifically, the Amended Liquidation Analysis/Financial Projections filed on February 1, 2021 

[Docket No. 1875] do not constitute any material adverse change to the treatment of any creditors 

or interest holders but, rather, simply update the estimated distributions based on Claims that were 

settled in the interim and provide updated financial data. The filing and notice of the Plan 

Supplements and Plan Modifications were appropriate and complied with the requirements of 

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section 1127(a) of the Bankruptcy Code and the Bankruptcy Rules, and no other solicitation or 

disclosure or further notice is or shall be required. The Plan Supplements and Plan Modifications 

each became part of the Plan pursuant section 1127(a) of the Bankruptcy Code. The Debtor or 

Reorganized Debtor, as applicable, is authorized to modify the Plan or Plan Supplement 

Documents following entry of this Confirmation Order in a manner consistent with section 1127(b) 

of the Bankruptcy Code, the Plan, and, if applicable, the terms of the applicable Plan Supplement 

Document. 

28. Notice of Transmittal, Mailing and Publication of Materials. As is 

evidenced by the Voting Certifications and the Affidavits of Service and Publication, the 

transmittal and service of the Plan, the Disclosure Statement, Ballots, and Confirmation Hearing 

Notice were adequate and sufficient under the circumstances, and all parties required to be given 

notice of the Confirmation Hearing (including the deadline for filing and serving objections to the 

confirmation of the Plan) have been given due, proper, timely, and adequate notice in accordance 

with the Disclosure Statement Order and in compliance with the Bankruptcy Code, the Bankruptcy 

Rules, the Local Rules, and applicable non-bankruptcy law, and such parties have had an 

opportunity to appear and be heard with respect thereto. No other or further notice is required. 

The publication of the Confirmation Hearing Notice, as set forth in the Notice of Affidavit of 

Publication dated December 3, 2020 [Docket No. 1505], complied with the Disclosure Statement 

Order. 

29. Voting. The Bankruptcy Court has reviewed and considered the Voting 

Certifications. The procedures by which the Ballots for acceptance or rejection of the Plan were 

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distributed and tabulated, including the tabulation as subsequently amended to reflect the 

settlement of certain Claims to be Allowed in Class 7, were fairly and properly conducted and 

complied with the Disclosure Statement Order, the Bankruptcy Code, the Bankruptcy Rules, and 

the Local Rules. 

30. Bankruptcy Rule 3016(a). In accordance with Bankruptcy Rule 3016(a), 

the Plan is dated and identifies the Debtor as the proponent of the Plan. 

31. Plan Compliance with Bankruptcy Code (11 U.S.C. § 1129(a)(1)). As 

set forth below, the Plan complies with all of the applicable provisions of the Bankruptcy Code, 

thereby satisfying section 1129(a)(1) of the Bankruptcy Code. 

32. Proper Classification (11 U.S.C. §§ 1122, 1123(a)(1)). Section 1122 of 

the Bankruptcy Code provides that a plan may place a claim or interest in a particular class only if 

such claim or interest is substantially similar to the other claims or interest of such class. The 

Claims and Equity Interests placed in each Class are substantially similar to other Claims and 

Equity Interests, as the case may be, in each such Class. Valid business, factual, and legal reasons 

exist for separately classifying the various Classes of Claims and Equity Interests created under 

the Plan, and such Classes do not unfairly discriminate between Holders of Claims and Equity 

Interests. 

33. Classification of Secured Claims. Class 1 (Jefferies Secured Claim) and 

Class 2 (Frontier Secured Claim) each constitute separate secured claims held by Jefferies LLC 

and Frontier State Bank, respectively, and it is proper and consistent with section 1122 of the 

Bankruptcy Code to separately classify the claims of these secured creditors. Class 3 (Other 

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Secured Claims) consists of other secured claims (to the extent any exist) against the Debtor, are 

not substantially similar to the Secured Claims in Class 1 or Class 2, and are also properly 

separately classified. 

34. Classification of Priority Claims. Class 4 (Priority Non-Tax Claims) 

consists of Claims entitled to priority under section 507(a), other than Priority Tax Claims, and are 

properly separately classified from non-priority unsecured claims. Class 5 (Retained Employee 

Claims) consists of the potential claims of employees who may be retained by the Debtor on the 

Effective Date, which claims will be Reinstated under the Plan, are not substantially similar to 

other Claims against the Debtor, and are properly classified. 

35. Classification of Unsecured Claims. Class 6 (PTO Claims) consists solely 

of the claims of the Debtor’s employees for unpaid paid time off in excess of the $13,650 statutory 

cap amount under sections 507(a)(4) and (a)(5) of the Bankruptcy Code and are dissimilar from 

other unsecured claims in Class 7 and Class 8. Class 7 (Convenience Claims) allows holders of 

eligible and liquidated Claims (below a certain threshold dollar amount) to receive a cash payout 

of the lesser of 85% of the Allowed amount of the creditor’s Claim or such holder’s pro rata share 

of the Convenience Claims Cash Pool. Class 7 (Convenience Claims) are provided for 

administrative convenience purposes in order to allow creditors, most of whom are either trade 

creditors or holders of professional claims, to receive treatment provided under Class 7 in lieu of 

the treatment of Class 8 (General Unsecured Claims). The Plan also provides for reciprocal “opt 

out” mechanisms to allow holders of Class 7 Claims to elect to receive the treatment for Class 8 

Claims. Class 8 creditors primarily constitute the litigation claims of the Debtor. Class 8 Creditors 

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will receive Claimant Trust Interests which will be satisfied pursuant to the terms of the Plan. 

Class 8 also contains an “opt out” mechanism to allow holders of liquidated Class 8 Claims at or 

below a $1 million threshold to elect to receive the treatment of Class 7 Convenience Claims. The 

Claims in Class 7 (primarily trade and professional Claims against the Debtor) are not substantially 

similar to the Claims in Class 8 (primarily the litigation Claims against the Debtor), and are 

appropriately separately classified. Valid business reasons also exist to classify creditors in Class 

7 separately from creditors in Class 8. Class 7 creditors largely consist of liquidated trade or 

service providers to the Debtor. In addition, the Claims of Class 7 creditors are small relative to 

the large litigation claims in Class 8. Furthermore, the Class 8 Claims were overwhelmingly 

unliquidated when the Plan was filed. The nature of the Class 7 Claims as being largely liquidated 

created an expectation of expedited payment relative to the largely unliquidated Claims in Class 

8, which consists in large part of parties who have been engaged in years, and in some cases over 

a decade of litigation with the Debtor. Separate classification of Class 7 and Class 8 creditors was 

the subject of substantial arm’s-length negotiations between the Debtor and the Committee to 

appropriately reflect these relative differences. 

36. Classification of Equity Interests. The Plan properly separately classifies 

the Equity Interests in Class 10 (Class B/C Limited Partnership Interests) from the Equity Interests 

in Class 11 (Class A Limited Partnership Interests) because they represent different types of equity 

security interests in the Debtor and different payment priorities. 

37. Elimination of Vacant Classes. Section III.C of the Plan provides for the 

elimination of Classes that do not have at least one holder of a Claim or Equity Interest that is 

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Allowed in an amount greater than zero for purposes of voting to accept or reject the Plan, and are 

disregarded for purposes of determining whether the Plan satisfies section 1129(a)(8) of the 

Bankruptcy Code with respect to such Class. The purpose of this provision is to provide that a 

Class that does not have voting members shall not be included in the tabulation of whether that 

Class has accepted or rejected the Plan. Pursuant to the Voting Certifications, the only voting 

Class of Claims or Equity Interests that did not have any members is Class 5 (Retained 

Employees). As noted above, Class 5 does not have any voting members because any potential 

Claims in Class 5 would not arise, except on account of any current employees of the Debtor who 

may be employed as of the Effective Date, which is currently unknown. Thus, the elimination of 

vacant Classes provided in Article III.C of the Plan does not violate section 1122 of the Bankruptcy 

Code. Class 5 is properly disregarded for purposes of determining whether or not the Plan has 

been accepted under Bankruptcy Code section 1129(a)(8) because there are no members in that 

Class. However, the Plan properly provides for the treatment of any Claims that may potentially 

become members of Class 5 as of the Effective Date in accordance with the terms of the Plan. The 

Plan therefore satisfies section 1122 of the Bankruptcy Code. 

38. Classification of Claims and Designation of Non-Classified Claims (11 

U.S.C. §§ 1122, 1123(a)(1)). Section 1123(a)(1) of the Bankruptcy Code requires that the Plan 

specify the classification of claims and equity security interests pursuant to section 1122 of the 

Bankruptcy Code, other than claims specified in sections 507(a)(2), 507(a)(3), or 507(a)(8) of the 

Bankruptcy Code. In addition to Administrative Claims, Professional Fee Claims, and Priority 

Tax Claims, each of which need not be classified pursuant to section 1123(a)(1) of the Bankruptcy 

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Code, the Plan designates eleven (11) Classes of Claims and Equity Interests. The Plan satisfies 

sections 1122 and 1123(a)(1) of the Bankruptcy Code. 

39. Specification of Unimpaired Classes (11 U.S.C. § 1123(a)(2)). Article III 

of the Plan specifies that each of Class 1 (Jefferies Secured Claim), Class 3 (Other Secured 

Claims), Class 4 (Priority Non-Tax Claims), Class 5 (Retained Employee Claims), and Class 6 

(PTO Claims) are Unimpaired under the Plan. Thus, the requirement of section 1123(a)(2) of the 

Bankruptcy Code is satisfied. 

40. Specification of Treatment of Impaired Classes (11 U.S.C. § 

1123(a)(3)). Article III of the Plan designates each of Class 2 (Frontier Secured Claim), Class 7 

(Convenience Claims), Class 8 (General Unsecured Claims), Class 9 (Subordinated Claims), Class 

10 (Class B/C Limited Partnership Interests), and Class 11 (Class A Limited Partnership Interests) 

as Impaired and specifies the treatment of Claims and Equity Interests in such Classes. Thus, the 

requirement of section 1123(a)(3) of the Bankruptcy Code is satisfied. 

41. No Discrimination (11 U.S.C. § 1123(a)(4)). The Plan provides for the 

same treatment by the Plan proponent for each Claim or Equity Interest in each respective Class 

unless the Holder of a particular Claim or Equity Interest has agreed to a less favorable treatment 

of such Claim or Equity Interest. The Plan satisfies this requirement because Holders of Allowed 

Claims or Equity Interests in each Class will receive the same rights and treatment as other Holders 

of Allowed Claims or Equity Interests within such holder’s respective class, subject only to the 

voluntary “opt out” options afforded to members of Class 7 and Class 8 in accordance with the 

terms of the Plan. Thus, the requirement of section 1123(a)(4) of the Bankruptcy Code is satisfied. 

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42. Implementation of the Plan (11 U.S.C. § 1123(a)(5)). Article IV of the 

Plan sets forth the means for implementation of the Plan which includes, but is not limited to, the 

establishment of: (i) the Claimant Trust; (ii) the Litigation Sub-Trust; (iii) the Reorganized Debtor; 

and (iv) New GP LLC, in the manner set forth in the Plan Documents, the forms of which are 

included in the Plan Supplements. 

a. The Claimant Trust. The Claimant Trust Agreement provides for the 

management of the Claimant Trust, as well as the Reorganized Debtor with the 

Claimant Trust serving as the managing member of New GP LLC (a wholly-owned 

subsidiary of the Claimant Trust that will manage the Reorganized Debtor as its 

general partner). The Claimant Trust, the Claimant Trustee, the management and 

monetization of the Claimant Trust Assets, and the management of the Reorganized 

Debtor (through the Claimant Trust’s role as managing member of New GP LLC) 

and the Litigation Sub-Trust will all be managed and overseen by the Claimant 

Trust Oversight Committee. Additionally, the Plan provides for the transfer to the 

Claimant Trust of all of the Debtor’s rights, title, and interest in and to all of the 

Claimant Trust Assets in accordance with section 1141 of the Bankruptcy Code and 

for the Claimant Trust Assets to automatically vest in the Claimant Trust free and 

clear of all Claims, Liens, encumbrances, or interests subject only to the Claimant 

Trust Interests and the Claimant Trust Expenses, as provided for in the Claimant 

Trust Agreement. The Claimant Trust will administer the Claimant Trust Assets as 

provided under the Plan and the Claimant Trust Agreement contained in the Plan 

Supplements. 

b. The Litigation Sub-Trust. The Plan and the Litigation Sub-Trust Agreement 

provide for the transfer to the Litigation Sub-Trust all of the Claimant Trust’s rights, 

title, and interest in and to all of the Estate Claims (as transferred to the Claimant 

Trust by the Debtor) in accordance with section 1141 of the Bankruptcy Code and 

for the Estate Claims to automatically vest in the Litigation Sub-Trust free and clear 

of all Claims, Liens, encumbrances, or interests subject only to the Litigation SubTrust Interests and the Litigation Sub-Trust Expenses, as provided for in the 

Litigation Sub-Trust Agreement. The Litigation Trustee is charged with 

investigating, pursuing, and otherwise resolving any Estate Claims (including those 

with respect to which the Committee has standing to pursue prior to the Effective 

Date pursuant to the January 9 Order) pursuant to the terms of the Litigation SubTrust Agreement and the Plan, regardless of whether any litigation with respect to 

any Estate Claim was commenced by the Debtor or the Committee prior to the 

Effective Date. 

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c. The Reorganized Debtor. The Reorganized Debtor will administer the 

Reorganized Debtor Assets, which includes managing the wind down of the 

Managed Funds. 

The precise terms governing the execution of these restructuring transactions are set forth in greater 

detail in the applicable definitive documents included in the Plan Supplements, including the 

Claimant Trust Agreement, the Litigation Sub-Trust Agreement, and the Schedule of Retained 

Causes of Action. The Plan, together with the documents and forms of agreement included in the 

Plan Supplements, provides a detailed blueprint for the transactions contemplated by the Plan. The 

Plan’s various mechanisms provide for the Debtor’s continued management of its business as it 

seeks to liquidate the Debtor’s assets, wind down its affairs, and pay the Claims of the Debtor’s 

creditors. Upon full payment of Allowed Claims, plus interest as provided in the Plan, any residual 

value would then flow to the holders of Class 10 (Class B/C Limited Partnership Interests), and 

Class 11 (Class A Limited Partnership Interests). Finally, Mr. Seery testified that the Debtor 

engaged in substantial and arm’s length negotiations with the Committee regarding the Debtor’s 

post-Effective Date corporate governance, as reflected in the Plan. Mr. Seery testified that he 

believes the selection of the Claimant Trustee, Litigation Trustee, and members of the Claimant 

Trust Oversight Board are in the best interests of the Debtor’s economic constituents. Thus, the 

requirements of section 1123(a)(5) of the Bankruptcy Code are satisfied. 

43. Non-Voting Equity Securities (11 U.S.C. § 1123(a)(6)). The Debtor is 

not a corporation and the charter documents filed in the Plan Supplements otherwise comply with 

section 1123(a)(6) of the Bankruptcy Code. Therefore, the requirement of section 1123(a)(6) of 

the Bankruptcy Code is satisfied. 

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44. Selection of Officers and Directors (11 U.S.C. § 1123(a)(7)). Article IV 

of the Plan provides for the Claimant Trust to be governed and administered by the Claimant 

Trustee. The Claimant Trust, the management of the Reorganized Debtor, and the management 

and monetization of the Claimant Trust Assets and the Litigation Sub-Trust will be managed by 

the Claimant Trust Oversight Board. The Claimant Trust Oversight Board will consist of: (1) Eric 

Felton, as representative of the Redeemer Committee; (2) Joshua Terry, as representative of Acis; 

(3) Elizabeth Kozlowski, as representative of UBS; (4) Paul McVoy, as representative of Meta-E 

Discovery; and (5) David Pauker. Four of the members of the Claimant Trust Oversight 

Committee are the holders of several of the largest Claims against the Debtor and/or are current 

members of the Committee. Each of these creditors has actively participated in the Debtor’s case, 

both through their fiduciary roles as Committee members and in their individual capacities as 

creditors. They are therefore intimately familiar with the Debtor, its business, and assets. The 

fifth member of the Claimant Trustee Oversight Board, David Pauker, is a disinterested 

restructuring advisor and turnaround manager with more than 25 years of experience advising 

public and private companies and their investors, and he has substantial experience overseeing, 

advising or investigating troubled companies in the financial services industry and has advised or 

managed such companies on behalf of boards or directors, court-appointed trustees, examiners and 

special masters, government agencies, and private investor parties. The members of the Claimant 

Trust Oversight Board will serve without compensation, except for Mr. Pauker, who will receive 

payment of $250,000 for his first year of service, and $150,000 for subsequent years. 

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45. Selection of Trustees. The Plan Supplements disclose that Mr. Seery will 

serve as the Claimant Trustee and Marc Kirschner will serve as the Litigation Trustee. As noted 

above, Mr. Seery has served as an Independent Board member since January 2020, and as the 

Chief Executive Officer and Chief Restructuring Officer since July 2020, and he has extensive 

management and restructuring experience, as evidenced from his curriculum vitae which is part of 

the record. The evidence shows that Mr. Seery is intimately familiar with the Debtor’s 

organizational structure, business, and assets, as well as how Claims will be treated under the Plan. 

Accordingly, it is reasonable and in the Estate’s best interests to continue Mr. Seery’s employment 

post-emergence as the Claimant Trustee. Mr. Seery, upon consultation with the Committee, 

testified that he intends to employ approximately 10 of the Debtor’s employees to enable him to 

manage the Debtor’s business until the Claimant Trust effectively monetizes its remaining assets, 

instead of hiring a sub-servicer to accomplish those tasks. Mr. Seery testified that he believes that 

the Debtor’s post-confirmation business can most efficiently and cost-effectively be supported by 

a sub-set of the Debtor’s current employees, who will be managed internally. Mr. Seery shall 

initially be paid $150,000 per month for services rendered after the Effective Date as Claimant 

Trustee; however, Mr. Seery’s long-term salary as Claimant Trustee and the terms of any bonuses 

and severance are subject to further negotiation by Mr. Seery and the Claimant Trust Oversight 

Board within forty-five (45) days after the Effective Date. The Bankruptcy Court has also 

reviewed Mr. Kirschner’s curriculum vitae. Mr. Kirschner has been practicing law since 1967 and 

has substantial experience in bankruptcy litigation matters, particularly with respect to his prior 

experience as a litigation trustee for several litigation trusts, as set forth on the record of the 

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Confirmation Hearing and in the Confirmation Brief. Mr. Kirschner shall be paid $40,000 per 

month for the first three months and $20,000 per month thereafter, plus a success fee related to 

litigation recoveries. The Committee and the Debtor had arm’s lengths negotiations regarding the 

post-Effective Date corporate governance structure of the Reorganized Debtor and believe that the 

selection of the Claimant Trustee, the Litigation Trustee, and the Claimant Trust Oversight 

Committee are in the best interests of the Debtor’s economic stakeholders. Section 1123(a)(7) of 

the Bankruptcy Code is satisfied. 

46. Debtor’s Compliance with Bankruptcy Code (11 U.S.C. § 1129(a)(2)). 

Pursuant to section 1129(a)(2) of the Bankruptcy Code, the Debtor has complied with the 

applicable provisions of the Bankruptcy Code, including sections 1122, 1123, 1124, 1125, and 

1126 of the Bankruptcy Code, the Bankruptcy Rules, and the Disclosure Statement Order 

governing notice, disclosure, and solicitation in connection with the Plan, the Disclosure 

Statement, the Plan Supplements, and all other matters considered by the Bankruptcy Court in 

connection with this Chapter 11 Case. 

47. Debtor’s Solicitation Complied with Bankruptcy Code and Disclosure 

Statement Order. Before the Debtor solicited votes on the Plan, the Bankruptcy Court entered 

the Disclosure Statement Order. In accordance with the Disclosure Statement Order and evidenced 

by the Affidavits of Service and Publication, the Debtor appropriately served (i) the Solicitation 

Packages (as defined in the Disclosure Statement Order) on the Holders of Claims in Classes 2, 7, 

8 and 9 and Holders of Equity Interests in Classes 10 and 11 who were entitled to vote on the Plan; 

and (ii) the Notice of Nonvoting Status (as defined in the Disclosure Statement Order) and the 

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Confirmation Hearing Notice to the Holders of Claims in Classes 1, 3, 4, 5 and 6, who were not 

entitled to vote on the Plan pursuant to the Disclosure Statement Order. The Disclosure Statement 

Order approved the contents of the Solicitation Packages provided to Holders of Claims and Equity 

Interests entitled to vote on the Plan, the notices provided to parties not entitled to vote on the Plan, 

and the deadlines for voting on and objecting to the Plan. The Debtor and KCC each complied 

with the content and delivery requirements of the Disclosure Statement Order, thereby satisfying 

sections 1125(a) and (b) of the Bankruptcy Code, as evidenced by the Affidavits of Service and 

Publication. The Debtor also satisfied section 1125(c) of the Bankruptcy Code, which provides 

that the same disclosure statement must be transmitted to each holder of a claim or interest in a 

particular class. The Debtor caused the same Disclosure Statement to be transmitted to all holders 

of Claims and Equity Interests entitled to vote on the Plan. The Debtor has complied in all respects 

with the solicitation requirements of section 1125 of the Bankruptcy Code and the Disclosure 

Statement Order. The Bankruptcy Court rejects the arguments of the Mr. Dondero and certain 

Dondero Related Entities that the changes made to certain assumptions and projections from the 

Liquidation Analysis annexed as Exhibit C to the Disclosure Statement (the “Liquidation 

Analysis”) to the Amended Liquidation Analysis/Financial Projections require resolicitation of the 

Plan. The Bankruptcy Court heard credible testimony from Mr. Seery regarding the changes to 

the Liquidation Analysis as reflected in the Amended Liquidation Analysis/Financial Projections. 

Based on the record, including the testimony of Mr. Seery, the Bankruptcy Court finds that the 

changes between the Liquidation Analysis and the Amended Liquidation Analysis/Financial 

Projections do not constitute materially adverse change to the treatment of Claims or Equity 

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Interests. Instead, the changes served to update the projected distributions based on Claims that 

were settled after the approval of the Disclosure Statement and to otherwise incorporate more 

recent financial data. Such changes were entirely foreseeable given the large amount of 

unliquidated Claims at the time the Disclosure Statement was approved and the nature of the 

Debtor’s assets. The Bankruptcy Court therefore finds that holders of Claims and Equity Interests 

were not misled or prejudiced by the Amended Liquidation Analysis/Financial Projections and the 

Plan does not need to be resolicited. 

48. Plan Proposed in Good Faith and Not by Means Forbidden by Law (11 

U.S.C. § 1129(a)(3)). The Debtor has proposed the Plan in good faith and not by any means 

forbidden by law, thereby satisfying section 1129(a)(3) of the Bankruptcy Code. In determining 

that the Plan has been proposed in good faith, the Bankruptcy Court has examined the totality of 

the circumstances surrounding the filing of this Chapter 11 Case, the Plan itself, and the extensive, 

unrebutted testimony of Mr. Seery in which he described the process leading to Plan’s formulation. 

Based on the totality of the circumstances and Mr. Seery’s testimony, the Bankruptcy Court finds 

that the Plan is the result of extensive arm’s-length negotiations among the Debtor, the Committee, 

and key stakeholders, and promotes the objectives and purposes of the Bankruptcy Code. 

Specifically, the Debtor’s good faith in proposing the Plan is supported by the following facts 

adduced by Mr. Seery: 

a. The Independent Board determined that it should consider all potential 

restructuring alternatives, including pursuit of a traditional restructuring and the 

continuation of the Debtor’s business, a potential sale of the Debtor’s assets in one 

or more transactions, an asset monetization plan similar to that described in the 

Plan, and a so-called “grand bargain” plan that would involve Mr. Dondero’s 

sponsorship of a plan with a substantial equity infusion. 

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b. The Debtor subsequently engaged in arm’s-length, good faith negotiations with the 

Committee over an asset monetization Plan commencing in June 2020, which 

negotiations occurred over the next several months. 

c. Negotiations between the Debtor and the Committee were often contentious over 

disputes, including, but not limited to, the post-confirmation corporate governance 

structure and the scope of releases contemplated by the Plan. 

d. While negotiations with the Committee progressed, the Independent Board engaged 

in discussions with Mr. Dondero regarding a potential “grand bargain” plan which 

contemplated a significant equity infusion by Mr. Dondero, and which Mr. Seery 

personally spent hundreds of hours pursuing over many months. 

e. On August 3, 2020, the Bankruptcy Court entered the Order Directing Mediation

[Docket No. 912] pursuant to which the Bankruptcy Court ordered the Debtor, the 

Committee, UBS, Acis, the Redeemer Committee, and Mr. Dondero into 

mediation. As a result of this mediation, the Debtor negotiated the settlement of 

the claims of Acis and Mr. Terry, which the Bankruptcy Court approved on October 

28, 2020 [Docket No. 1302]. 

f. On August 12, 2020, the Debtor filed its Chapter 11 Plan of Reorganization of 

Highland Capital Management, L.P. [Docket No. 944] (the “Initial Plan”) and 

related disclosure statement (the “Initial Disclosure Statement”) which were not 

supported by either the Committee or Mr. Dondero. The Independent Board filed 

the Initial Plan and Initial Disclosure Statement in order to act as a catalyst for 

continued discussions with the Committee while it simultaneously worked with Mr. 

Dondero on the “grand bargain” plan. 

g. The Bankruptcy Court conducted a contested hearing on the Initial Disclosure 

Statement on October 27, 2020. The Committee and other parties objected to 

approval of the Disclosure Statement at the Initial Disclosure Statement hearing, 

which was eventually continued to November 23, 2020. 

h. Following the Initial Disclosure Statement hearing, the Debtor continued to 

negotiate with the Committee and ultimately resolved the remaining material 

disputes and led to the Bankruptcy Court’s approval of the Disclosure Statement on 

November 23, 2020. 

i. Even after obtaining the Bankruptcy Court’s approval of the Disclosure Statement, 

the Debtor and the Committee continued to negotiate with Mr. Dondero and the 

Committee over a potential “pot plan” as an alternative to the Plan on file with the 

Bankruptcy Court, but such efforts were unsuccessful. This history conclusively 

demonstrates that the Plan is being proposed in good faith within the meaning of 

section 1129(a)(3). 

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49. Payments for Services or Costs and Expenses (11 U.S.C. § 1129(a)(4)). 

Article II.B of the Plan provides that Professionals will file all final requests for payment of 

Professional Fee Claims no later than 60 days after the Effective Date, thereby providing an 

adequate period of time for interested parties to review such claims. The procedures set forth in 

the Plan for the Bankruptcy Court’s approval of the fees, costs, and expenses to be paid in 

connection with this chapter 11 Case, or in connection with the Plan and incident to this Chapter 

11 Case, satisfy the objectives of and are in compliance with section 1129(a)(4) of the Bankruptcy 

Code. 

50. Directors, Officers, and Insiders (11 U.S.C. § 1129(a)(5)). Article IV.B 

of the Plan provides for the appointment of the Claimant Trustee, Litigation Trustee, and the 

Claimant Trust Oversight Committee and the members thereto. For the reasons more fully 

explained in paragraphs 44-45 of this Confirmation Order with respect to the requirement of 

section 1123(a)(7) of the Bankruptcy Code, the Debtor has disclosed the nature of compensation 

of any insider to be employed or retained by the Reorganized Debtor, if applicable, and 

compensation for any such insider. The appointment of such individuals is consistent with the 

interests of Claims and Equity Interests and with public policy. Thus, the Plan satisfies section 

1129(a)(5) of the Bankruptcy Code. 

51. No Rate Changes (11 U.S.C. § 1129(a)(6)). The Plan does not provide for 

any rate change that requires regulatory approval. Section 1129(a)(6) of the Bankruptcy Code is 

thus not applicable. 

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52. Best Interests of Creditors (11 U.S.C. § 1129(a)(7)). The “best interests” 

test is satisfied as to all Impaired Classes under the Plan, as each Holder of a Claim or Equity 

Interest in such Impaired Classes will receive or retain property of a value, as of the Effective Date 

of the Plan, that is not less than the amount that such Holder would so receive or retain if the 

Debtor were liquidated under chapter 7 of the Bankruptcy Code. On October 15, 2020, the Debtor 

filed the Liquidation Analysis [Docket 1173], as prepared by the Debtor with the assistance of its 

advisors and which was attached as Exhibit C to the Disclosure Statement. On January 29, 2021, 

in advance of Mr. Seery’s deposition in connection with confirmation of the Plan, the Debtor 

provided an updated version of the Liquidation Analysis to the then-objectors of the Plan, 

including Mr. Dondero and the Dondero Related Entities. On February 1, 2021, the Debtor filed 

the Amended Liquidation Analysis/Financial Projections. The Amended Liquidation 

Analysis/Financial Projections included updates to the Debtor’s projected asset values, revenues, 

and expenses to reflect: (1) the acquisition of an interest in an entity known as “HCLOF” that the 

Debtor will acquire as part of its court-approved settlement with HarbourVest and that was valued 

at $22.5 million; (2) an increase in the value of certain of the Debtor’s assets due to changes in 

market conditions and other factors; (3) expected revenues and expenses arising in connection with 

the Debtor’s continued management of the CLOs pursuant to management agreements that the 

Debtor decided to retain; (4) increases in projected expenses for headcount (in addition to adding 

two or three employees to assist in the management of the CLOs, the Debtor also increased 

modestly the projected headcount as a result of its decision not to engage a Sub-Servicer) and 

professional fees; and (5) an increase in projected recoveries on notes resulting from the 

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acceleration of term notes owed to the Debtor by the following Dondero Related Entities: 

NexPoint Advisors, L.P.; Highland Capital Management Services, Inc.; and HCRE Partners, LLC 

(n/k/a NexPoint Real Estate Partners, LLC). Under the Plan, as of the Confirmation Date, (a) Class 

7 General Unsecured Creditors are projected to receive 85% on account of their claims; and (b) 

Class 8 General Unsecured Creditors are projected to receive at least approximately 71% on 

account of their Claims. Under a hypothetical chapter 7 liquidation, all general unsecured creditors 

are projected to receive approximately 55% on account of their Claims. The Bankruptcy Court 

finds that the distributions that Class 7 and 8 General Unsecured Creditors are projected to receive 

under the Plan substantially exceeds that which they would receive under a chapter 7 liquidation 

based on Mr. Seery’s testimony, including the following credible reasons he posited, among 

others: 

a. The nature of the Debtor’s assets is complex. Certain assets relate to complicated 

real estate structures and private equity investments in operating businesses. Mr. 

Seery’s extensive experience with the Debtor during the thirteen months since his 

appointment as an Independent Director and later Chief Executive Officer and 

Chief Restructuring Officer, provides him with a substantial learning curve in 

connection with the disposition of the Debtor’s assets and are reasonably expected 

to result in him being able to realize tens of millions of dollars more value than 

would a chapter 7 trustee. 

b. Assuming that a hypothetical chapter 7 trustee could even operate the Debtor’s 

business under chapter 7 of the Bankruptcy Code and hire the necessary personnel 

with the relevant knowledge and experience to assist him or her in selling the 

Debtor’s assets, a chapter 7 trustee would likely seek to dispose of the Debtor’s 

assets in a forced sale liquidation which would generate substantially less value for 

the Debtor’s creditors than the asset monetization plan contemplated by the Plan. 

c. A chapter 7 trustee would be unlikely to retain the Debtor’s existing professionals 

to assist in its efforts to monetize assets, resulting in delays, increased expenses, 

and reduced asset yields for the chapter 7 estate. 

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d. The chapter 7 estate would be unlikely to maximize value as compared to the asset 

monetization process contemplated by the Plan because potential buyers are likely 

to perceive a chapter 7 trustee as engaging in a quick, forced “fire sale” of assets; 

and 

e. The Debtor’s employees, who are vital to its efforts to maximum value and 

recoveries for stakeholders, may be unwilling to provide services to a chapter 7 

trustee. 

Finally, there is no evidence to support the objectors’ argument that the Claimant Trust 

Agreement’s disclaimed liability for ordinary negligence by the Claimant Trustee compared to a 

chapter 7 trustee’s liability has any relevance to creditor recoveries in a hypothetical chapter 7 

liquidation. Thus, section 1129(a)(7) of the Bankruptcy Code is satisfied. 

53. Acceptance by Certain Classes (11 U.S.C. § 1129(a)(8)). Classes 1, 3, 4, 

5 and 6 are Unimpaired under the Plan. Class 2 (Frontier Secured Claim), Class 7 (Convenience 

Claims), and Class 9 (Subordinated Claims) have each voted to accept the Plan in accordance with 

the Bankruptcy Code, thereby satisfying section 1129(a)(8) as to those Classes. However, Class 

8 (General Unsecured Claims), Class 10 (Class B/C Limited Partnership Interests), and Class 11 

(Class A Limited Partnership Interests) have not accepted the Plan. Accordingly, section 

1129(a)(8) of the Bankruptcy Code has not been satisfied. The Plan, however, is still confirmable 

because it satisfies the nonconsensual confirmation provisions of section 1129(b), as set forth 

below. 

54. Treatment of Administrative, Priority, Priority Tax Claims, and 

Professional Fee Claims (11 U.S.C. § 1129(a)(9)). The treatment of Administrative Claims, 

Priority Claims, and Professional Fee Claims pursuant to Article III of the Plan, and as set forth 

below with respect to the resolution of the objections filed by the Internal Revenue Service and 

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certain Texas taxing authorities satisfies the requirements of sections 1129(a)(9) of the Bankruptcy 

Code. 

55. Acceptance by Impaired Class (11 U.S.C. § 1129(a)(10)). Class 2 

(Frontier Secured Claims) and Class 7 (Convenience Claims) are each Impaired Classes of Claims 

that voted to accept the Plan, determined without including any acceptance of the Plan by any 

insider. Therefore, the requirement of section 1129(a)(10) of the Bankruptcy Code is satisfied. 

56. Feasibility (11 U.S.C. § 1129(a)(11)). Article IV of the Plan provides for 

the implementation of the Plan through the Claimant Trust, the Litigation Sub-Trust, and the 

Reorganized Debtor. The Plan provides that the Claimant Trust, among other things, will monetize 

and distribute the Debtor’s remaining assets. The Disclosure Statement, the Amended Liquidation 

Analysis/Financial Projections, and the other evidence presented at the Confirmation Hearing 

provide a reasonable probability of success that the Debtor will be able to effectuate the provisions 

of the Plan. The Plan contemplates the establishment of the Claimant Trust upon the Effective 

Date, which will monetize the Estate’s assets for the benefit of creditors. Mr. Seery testified that 

the Class 2 Frontier Secured Claim will be paid over time pursuant to the terms of the New Frontier 

Note and the Reorganized Debtor will have sufficient assets to satisfy its obligations under this 

note. The Claims of the Holders of Class 7 Claims (as well as those Class 8 creditors who validly 

opted to receive the treatment of Class 7 Claims) are expected to be satisfied shortly after the 

Effective Date. Holders of Class 8 Claims (including any holders of Class 7 Claims who opted to 

receive the treatment provided to Class 8 Claims) are not guaranteed any recovery and will 

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periodically receive pro rata distributions as assets are monetized pursuant to the Plan and the 

Claimant Trust Agreement. Thus, section 1129(a)(11) of the Bankruptcy Code is satisfied. 

57. Payment of Fees (11 U.S.C. § 1129(a)(12)). All fees payable under 28 

U.S.C. § 1930 have been paid or will be paid on or before the Effective Date pursuant to Article 

XII.A of the Plan, thus satisfying the requirement of section 1129(a)(12) of the Bankruptcy Code. 

The Debtor has agreed that the Reorganized Debtor, the Claimant Trust, and the Litigation SubTrust shall be jointly and severally liable for payment of quarterly fees to the Office of the United 

States Trustee pursuant to 28 U.S.C. § 1930 through the entry of the Final Decree for the Debtor 

or the dismissal or conversion of the Chapter 11 Case. 

58. Retiree Benefits. The Plan provides for the assumption of the Pension Plan 

(to the extent such Pension Plan provides “retiree benefits” and is governed by section 1114 of the 

Bankruptcy Code). Thus, the Plan complies with section 1129(a)(13) of the Bankruptcy Code, to 

the extent applicable.

59. Miscellaneous Provisions (11 U.S.C. §§ 1129(a)(14)-(16)). Sections 

1129(a)(14)-(16) of the Bankruptcy Code are inapplicable as the Debtor (i) has no domestic 

support obligations (section 1129(a)(14)), (ii) is not an individual (section 1129(a)(15)), and (iii) 

is not a nonprofit corporation (section 1129(a)(16)). 

60. No Unfair Discrimination; Fair and Equitable Treatment (11 U.S.C. § 

1129(b)). The classification and treatment of Claims and Equity Interests in Classes 8, 10 and 11, 

which have not accepted the Plan, is proper pursuant to section 1122 of the Bankruptcy Code, does 

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not discriminate unfairly, and is fair and equitable pursuant to section 1129(b)(1) of the Bankruptcy 

Code. 

a. Class 8. The Plan is fair and equitable with respect to Class 8 General Unsecured 

Claims. While Equity Interests in Class 10 and Class 11 will receive a contingent 

interest in the Claimant Trust under the Plan (the “Contingent Interests”), the 

Contingent Interests will not vest unless and until holders of Class 8 General 

Unsecured Claims and Class 9 Subordinated Claims receive distributions equal to 

100% of the amount of their Allowed Claims plus interest as provided under the 

Plan and Claimant Trust Agreement. Accordingly, as the holders of Equity 

Interests that are junior to the Claims in Class 8 and Class 9 will not receive or 

retain under the Plan on account of such junior claim interest any property unless 

and until the Claims in Class 8 and Class 9 are paid in full plus applicable interest, 

the Plan is fair and equitable with respect to holders of Class 8 General Unsecured 

Claims pursuant to section 1129(b)(2)(B) of the Bankruptcy Code and the reasoning 

of In re Introgen Therapuetics 429 B.R 570 (Bankr. W.D. Tex. 2010). 

b. Class 10 and Class 11. There are no Claims or Equity Interests junior to the Equity 

Interests in Class 10 and Class 11. Equity Interests in Class 10 and 11 will neither 

receive nor retain any property under the Plan unless Allowed Claims in Class 8 

and Class 9 are paid in full plus applicable interest pursuant to the terms of the Plan 

and Claimant Trust Agreement. Thus, the Plan does not violate the absolute priority 

rule with respect to Classes 10 and 11 pursuant to Bankruptcy Code section 

1129(b)(2)(C). The Plan does not discriminate unfairly as to Equity Interests. As 

noted above, separate classification of the Class B/C Partnership Interests from the 

Class A Partnerships Interests is appropriate because they constitute different 

classes of equity security interests in the Debtor, and each are appropriately 

separately classified and treated. 

Accordingly, the Plan does not violate the absolute priority rule, does not discriminate unfairly, 

and is fair and equitable with respect to each Class that has rejected the Plan. Thus, the Plan 

satisfies the requirements of section 1129(b) of the Bankruptcy Code with respect to Classes 8, 10, 

and 11. 

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61. Only One Plan (11 U.S.C. § 1129(c)). The Plan is the only chapter 11 plan 

confirmed in this Chapter 11 Case, and the requirements of section 1129(c) of the Bankruptcy 

Code are therefore satisfied. 

62. Principal Purpose (11 U.S.C. § 1129(d)). Mr. Seery testified that the 

principal purpose of the Plan is neither the avoidance of taxes nor the avoidance of the application 

of section 5 of the Securities Act of 1933, and no governmental unit has objected to the 

confirmation of the Plan on any such grounds. Accordingly, section 1129(d) of the Bankruptcy 

Code is inapplicable. 

63. Satisfaction of Confirmation Requirements. Based upon the foregoing, 

the Plan satisfies the requirements for confirmation set forth in section 1129 of the Bankruptcy 

Code and should be confirmed. 

64. Good Faith Solicitation (11 U.S.C. § 1125(e)). The Debtor, the 

Independent Directors, and the Debtor’s employees, advisors, Professionals, and agents have acted 

in good faith within the meaning of section 1125(e) of the Bankruptcy Code and in compliance 

with the applicable provisions of the Bankruptcy Code and Bankruptcy Rules in connection with 

all of their respective activities relating to the solicitation of acceptances of the Plan and their 

participation in the activities described in section 1125 of the Bankruptcy Code, and they are 

entitled to the protections afforded by section 1125(e) of the Bankruptcy Code. 

65. Discharge (11 U.S.C. § 1141(d)(3)). The Debtor is entitled to a discharge 

of debts pursuant to section 1141(d)(3)(B) of the Bankruptcy Code. Under the Plan, the Claimant 

Trust or Reorganized Debtor, as applicable, will continue to manage funds and conduct business 

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in the same manner as the Debtor did prior to Plan confirmation, which includes the management 

of the CLOs, Multi-Strat, Restoration Capital, the Select Fund and the Korea Fund. Although the 

Plan projects that it will take approximately two years to monetize the Debtor’s assets for fair 

value, Mr. Seery testified that while the Reorganized Debtor and Claimant Trust will be 

monetizing their assets, there is no specified time frame by which this process must conclude. Mr. 

Seery’s credible testimony demonstrates that the Debtor will continue to engage in business after 

consummation of the Plan, within the meaning of Section 1141(d)(3)(b) and that the Debtor is 

entitled to a discharge pursuant to section 1141(d)(1) of the Bankruptcy Code. 

66. Retention of Jurisdiction. The Bankruptcy Court may properly retain 

jurisdiction over the matters set forth in Article XI of the Plan and/or section 1142 of the 

Bankruptcy Code to the maximum extent under applicable law. 

67. Additional Plan Provisions (11 U.S.C. § 1123(b)). The Plan’s provisions 

are appropriate, in the best interests of the Debtor and its Estate, and consistent with the applicable 

provisions of the Bankruptcy Code, Bankruptcy Rules, and Local Rules. 

68. Executory Contracts and Unexpired Leases (11 U.S.C. § 1123(b)(2)). 

The Debtor has exercised reasonable business judgment with respect to the rejection of the 

Executory Contracts and Unexpired Leases pursuant the terms of the Plan and this Confirmation 

Order, and such rejections are justified and appropriate in this Chapter 11 Case. The Debtor also 

filed the List of Assumed Contracts, which contain notices to the applicable counterparties to the 

contracts set forth on Exhibit “FF” to Plan Supplement filed on February 1, 2021 [Docket No. 

1875] and which exhibit sets forth the list of executory contracts and unexpired leases to be 

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assumed by the Debtor pursuant to the Plan (collectively, the “Assumed Contracts”). With respect 

to the Assumed Contracts, only one party objected to the assumption of any of the Assumed 

Contracts, but that objection was withdrawn.8

 Any modifications, amendments, supplements, and 

restatements to the Assumed Contracts that may have been executed by the Debtor during the 

Chapter 11 Case shall not be deemed to alter the prepetition nature of the Assumed Contracts or 

the validity, priority, or amount of any Claims that may arise in connection therewith. Assumption 

of any Assumed Contract pursuant to the Plan and full payment of any applicable Cure pursuant 

to the Plan shall result in the full release and satisfaction of any Cures, Claims, or defaults, whether 

monetary or nonmonetary, including defaults of provisions restricting the change in control or 

ownership interest composition or other bankruptcy-related defaults, arising under any assumed 

Executory Contract or Unexpired Lease at any time prior to the effective date of assumption. 

69. Compromises and Settlements Under and in Connection with the Plan 

(11 U.S.C. § 1123(b)(3)). All of the settlements and compromises pursuant to and in connection 

with the Plan, comply with the requirements of section 1123(b)(3) of the Bankruptcy Code and 

Bankruptcy Rule 9019. 

70. Debtor Release, Exculpation and Injunctions (11 U.S.C. § 1123(b)). The 

Debtor Release, Exculpation, and Injunction provisions provided in the Plan (i) are within the 

jurisdiction of the Bankruptcy Court under 28 U.S.C. § 1334; (ii) are integral elements of the 

transactions incorporated into the Plan, and inextricably bound with the other provisions of the 

Plan; (iii) confer material benefit on, and are in the best interests of, the Debtor, its Estate, and its 

8 See Notice of Withdrawal of James Dondero’s Objection Debtor’s Proposed Assumption of Contracts and Cure 

Amounts Proposed in Connection Therewith [Docket No. 1876] 

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creditors; (iv) are fair, equitable, and reasonable; (v) are given and made after due notice and 

opportunity for hearing; (vi) satisfy the requirements of Bankruptcy Rule 9019; and (vii) are 

consistent with the Bankruptcy Code and other applicable law, and as set forth below. 

71. Debtor Release. Section IX.D of the Plan provides for the Debtor’s release 

of the Debtor’s and Estate’s claims against the Released Parties. Releases by a debtor are 

discretionary and can be provided by a debtor to persons who have provided consideration to the 

Debtor and its estate pursuant to section 1123(b)(3)(A) of the Bankruptcy Code. Contrary to the 

objections raised by Mr. Dondero and certain of the Dondero Related Entities, the Debtor Release 

is appropriately limited to release claims held by the Debtor and does not purport to release the 

claims held by the Claimant Trust, Litigation Sub-Trust, or other third parties. The Plan does not 

purport to release any claims held by third parties and the Bankruptcy Court finds that the Debtor 

Release is not a “disguised” release of any third party claims as asserted by certain objecting 

parties. The limited scope of the Debtor Release in the Plan was extensively negotiated with the 

Committee, particularly with the respect to the Debtor’s conditional release of claims against 

employees, as identified in the Plan, and the Plan’s conditions and terms of such releases. The 

Plan does not release (i) any obligations of any party under the Plan or any document, instrument, 

or agreement executed to implement the Plan, (ii) the rights or obligations of any current employee 

of the Debtor under any employment agreement or plan, (iii) the rights of the Debtor with respect 

to any confidentiality provisions or covenants restricting competition in favor of the Debtor under 

any employment agreement with a current or former employee of the Debtor, (iv) any Avoidance 

Actions, or (v) any Causes of Action arising from willful misconduct, criminal misconduct, actual 

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fraud, or gross negligence of such applicable Released Party as determined by Final Order of the 

Bankruptcy Court or any other court of competent jurisdiction. The Debtor Release also contains 

conditions to such releases as set forth in Article X.D of the Plan with respect to employees (the 

“Release Conditions”). Until the an employee satisfies the Release Conditions or the Release 

Conditions otherwise terminate, any claims against such employee will be tolled so that if the 

Release Conditions are not met the Litigation Trustee may pursue claims against an employee at a 

later date. The evidence before the Bankruptcy Court, including, but not limited to Mr. Seery’s 

testimony, demonstrates that the Debtor is not aware of any claims against any of the Released 

Parties, that the Released Parties have been instrumental in assisting the Debtor’s efforts toward 

confirmation of the Plan and that, therefore, the releases are a quid pro quo for the Released 

Parties’ significant contributions to a highly complex and contentious restructuring. The 

Committee, whose members hold approximately $200 million in claims against the Estate, is 

highly sophisticated and is represented by highly sophisticated professionals, and has actively and 

vigorously negotiated the terms of the Debtor Release, which was the subject of significant 

controversy at the Initial Disclosure Statement hearing held by the Bankruptcy Court on October 

27, 2020. 

72. Exculpation. Section IX.C of the Plan provides for the exculpation of 

certain Exculpated Parties to the extent provided therein (the “Exculpation Provision”). As 

explained below, the Exculpation Provision is appropriate under the unique circumstances of this 

litigious Chapter 11 Case and consistent with applicable Fifth Circuit precedent. First, with respect 

to the Independent Directors, their agents, and their advisors, including any employees acting at 

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their direction, the Bankruptcy Court finds and concludes that it has already exculpated these 

parties for acts other than willful misconduct and gross negligence pursuant to the January 9 Order. 

The January 9 Order was specifically agreed to by Mr. Dondero, who was in control of the Debtor 

up until entry of the January 9 Order. The January 9 Order was not appealed. In addition to the 

appointment of the Independent Directors in an already contentious and litigious case, the January 

9 Order set the standard of care for the Independent Directors and specifically exculpated them for 

negligence. Mr. Seery and Mr. Dubel each testified that they had input into the contents of the 

January 9 Order and would not have agreed to their appointment as Independent Directors if the 

January 9 Order did not include the protections set forth in paragraph 10 of the January 9 Order. 

Paragraph 10 of the January 9 Order (1) requires that parties wishing to sue the Independent 

Directors or their agents and advisors must first seek approval from the Bankruptcy Court before 

doing so; (2) sets the standard of care for the Independent Directors during the Chapter 11 Case 

and exculpated the Independent Directors for acts other than willful misconduct or gross 

negligence; (3) only permits suits against the Independent Directors to proceed for colorable claims 

of willful misconduct and gross negligence upon order of the Bankruptcy Court; and (4) does not 

expire by its terms. 

73. Existing Exculpation of Independent Directors. The Bankruptcy Court 

also finds and concludes that it has already exculpated Mr. Seery acting in the capacity as Chief 

Executive Officer and Chief Restructuring Officer pursuant to the July 16 Order. The Bankruptcy 

Court concludes its previous approval of the exculpation of the Independent Directors, their agents, 

advisors and employees working at their direction pursuant to the January 9 Order, and the Chief 

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Executive Officer and Chief Restructuring Officer pursuant to the July 16 Order constitutes the 

law of this case and are res judicata pursuant to In re Republic Supply Co. v. Shoaf, 815 F.2d 1046 

(5th Cir.1987). The January 9 Order and July 16 Order cannot be collaterally attacked based on 

the objectors’ objection to the exculpation of the Independent Directors, their agents, and advisors, 

including any employees acting at their direction, as well as the Chief Executive Officer and Chief 

Restructuring Officer, that the Bankruptcy Court already approved pursuant to the January 9 Order 

and the July 16 Order. 

74. The Exculpation Provision Complies with Applicable Law. Separate 

and apart from the res judicata effect of the January 9 Order and the July 16 Order, the Bankruptcy 

Court also finds and concludes that the Exculpation Provision is consistent with applicable law, 

including In re Pacific Lumber Co., 584 F.3d 229 (5th Cir. 2009), for several reasons: 

a. First, the statutory basis for Pacific Lumber’s denial of exculpation for certain 

parties other than a creditors’ committee and its members is that section 524(e) of 

the Bankruptcy Code “only releases the debtor, not co-liable third parties.” Pacific 

Lumber, 253 F.3d. at 253. However, Pacific Lumber does not prohibit all 

exculpations under the Bankruptcy Code and the court in such case specifically 

approved the exculpations of a creditors’ committee and its members on the 

grounds that “11 U.S.C. § 1103(c), which lists the creditors’ committee’s powers, 

implies committee members have qualified immunity for actions within the scope 

of their duties.... [I]f members of the committee can be sued by persons unhappy 

with the committee’s performance during the case or unhappy with the outcome of 

the case, it will be extremely difficult to find members to serve on an official 

committee.” Pacific Lumber, 253 F.3d at 253 (quoting Lawrence P. King, et al, 

Collier on Bankruptcy, ¶ 1103.05[4][b] (15th Ed. 2008]). Pacific Lumber’s

rationale for permitted exculpation of creditors’ committees and their members 

(which was clearly policy-based and based on a creditors’ committee qualified 

immunity flowing from their duties under section 1103(c) of the Bankruptcy Code 

and their disinterestedness and importance in chapter 11 cases) does not preclude 

exculpation to other parties in a particular chapter 11 case that perform similar roles 

to a creditors’ committee and its members. The Independent Directors, and by 

extension the Chief Executive Officer and Chief Restructuring Officer, were not 

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part of the Debtor’s enterprise prior to their appointment by the Bankruptcy Court 

under the January 9 Order. The Bankruptcy Court appointed the Independent 

Directors in lieu of a chapter 11 trustee to address what the Bankruptcy Court 

perceived as serious conflicts of interest and fiduciary duty concerns with the thenexisting management prior to January 9, 2020, as identified by the Committee. In 

addition, the Bankruptcy Court finds that the Independent Directors expected to be 

exculpated from claims of negligence, and would likely have been unwilling to 

serve in contentious cases absent exculpation. The uncontroverted testimony of 

Mr. Seery and Mr. Dubel demonstrates that the Independent Directors would not 

have agreed to accept their roles without the exculpation and gatekeeper provision 

in the January 9 Order. Mr. Dubel also testified as to the increasing important role 

that independent directors are playing in complex chapter 11 restructurings and that 

unless independent directors could be assured of exculpation for simple negligence 

in contentious bankruptcy cases they would be reluctant to accept appointment in 

chapter 11 cases which would adversely affect the chapter 11 restructuring process. 

The Bankruptcy Court concludes that the Independent Directors were appointed 

under the January 9 Order in order to avoid the appointment of a chapter 11 trustee 

and are analogous to a creditors’ committee rather than an incumbent board of 

directors. The Bankruptcy Court also concludes that if independent directors 

cannot be assured of exculpation for simple negligence in contentious bankruptcy 

cases, they may not be willing to serve in that capacity. Based upon the foregoing, 

the Bankruptcy Court concludes that Pacific Lumber’s policy of exculpating 

creditors’ committees and their members from “being sued by persons unhappy 

with the committee’s performance during the case or unhappy with the outcome of 

the case” is applicable to the Independent Directors in this Chapter 11 Case.9

 

b. Second, the Bankruptcy Court also concludes that Pacific Lumber does not 

preclude the exculpation of parties if there is a showing that “costs [that] the 

released parties might incur defending against such suits alleging such negligence 

are likely to swamp either the Exculpated Parties or the reorganization.” Pacific 

Lumber, 584 F.3d at 252. If ever there was a risk of that happening in a chapter 11 

reorganization, it is this one. Mr. Seery credibly testified that Mr. Dondero stated 

outside the courtroom that if Mr. Dondero’s pot plan does not get approved, that 

Mr. Dondero will “burn the place down.” The Bankruptcy Court can easily expect 

that the proposed Exculpated Parties might expect to incur costs that could swamp 

them and the reorganization based on the prior litigious conduct of Mr. Dondero 

and his controlled entities that justify their inclusion in the Exculpation Provision. 

9

 The same reasoning applies to the inclusion of Strand in the Exculpation Provision because Strand is the general 

partner of the Debtor through which each of the Independent Board members act. 

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75. Injunction. Section IX.D of the Plan provides for a Plan inunction to 

implement and enforce the Plan’s release, discharge and release provisions (the “Injunction 

Provision”). The Injunction Provision is necessary to implement the provisions in the Plan. Mr. 

Seery testified that the Claimant Trustee will monetize the Debtor’s assets in order to maximize 

their value. In order to accomplish this goal, the Claimant Trustee needs to be able to pursue this 

objective without the interference and harassment of Mr. Dondero and his related entities, 

including the Dondero Related Entities. Mr. Seery also testified that if the Claimant Trust was 

subject to interference by Mr. Dondero, it would take additional time to monetize the Debtor’s 

assets and those assets could be monetized for less money to the detriment of the Debtor’s 

creditors. The Bankruptcy Court finds and concludes that the Injunction Provision is consistent 

with and permissible under Bankruptcy Code sections 1123(a), 1123(a)(6), 1141(a) and (c), and 

1142. The Bankruptcy Court rejects assertions by certain objecting parties that the Injunction 

Provision constitutes a “third-party release.” The Injunction Provision is appropriate under the 

circumstances of this Chapter 11 Case and complies with applicable bankruptcy law. The 

Bankruptcy Court also concludes that the terms “implementation” and “consummation” are neither 

vague nor ambiguous 

76. Gatekeeper Provision. Section IX.F of the Plan contains a provision 

contained in paragraph AA of this Confirmation Order and which the Debtor has referred to as a 

gatekeeper provision (the “Gatekeeper Provision”). The Gatekeeper Provision requires that 

Enjoined Parties first seek approval of the Bankruptcy Court before they may commence an action 

against Protected Parties. Thereafter, if the Bankruptcy Court determines that the action is 

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colorable, the Bankruptcy Court may, if it has jurisdiction, adjudicate the action. The Bankruptcy 

Court finds that the inclusion of the Gatekeeper Provision is critical to the effective and efficient 

administration, implementation, and consummation of the Plan. The Bankruptcy Court also 

concludes that the Bankruptcy Court has the statutory authority as set forth below to approve the 

Gatekeeper Provision. 

77. Factual Support for Gatekeeper Provision. The facts supporting the need 

for the Gatekeeper Provision are as follows. As discussed earlier in this Confirmation Order, prior 

to the commencement of the Debtor’s bankruptcy case, and while under the direction of Mr. 

Dondero, the Debtor had been involved in a myriad of litigation, some of which had gone on for 

years and, in some cases, over a decade. Substantially all of the creditors in this case are either 

parties who were engaged in litigation with the Debtor, parties who represented the Debtor in 

connection with such litigation and had not been paid, or trade creditors who provided litigationrelated services to the Debtor. During the last several months, Mr. Dondero and the Dondero 

Related Entities have harassed the Debtor, which has resulted in further substantial, costly, and 

time-consuming litigation for the Debtor. Such litigation includes: (i) entry of a temporary 

restraining order and preliminary injunction against Mr. Dondero [Adv. Proc. No. 20-03190 

Docket No. 10 and 59] because of, among other things, his harassment of Mr. Seery and employees 

and interference with the Debtor’s business operations; (ii) a contempt motion against Mr. 

Dondero for violation of the temporary restraining order, which motion is still pending before the 

Bankruptcy Court [Adv. Proc. No. 20-03190 Docket No. 48]; (iii) a motion by Mr. Dondero’s 

controlled investors in certain CLOs managed by the Debtor that the Bankruptcy Court referred to 

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as frivolous and a waste of the Bankruptcy Court’s time [Docket No. 1528] which was denied by 

the Court [Docket No. 1605]; (iv) multiple plan confirmation objections focused on ensuring the 

Dondero Related Entities be able to continue their litigation against the Debtor and its successors 

post-confirmation [Docket Nos. 1661, 1667, 1670, 1673, 1676, 1677 and 1868]; (v) objections to 

the approval of the Debtor’s settlements with Acis and HarbourVest and subsequent appeals of the 

Bankruptcy Court’s order approving each of those settlements [Docket Nos. 1347 and 1870]; and 

(vi) a complaint and injunction sought against Mr. Dondero’s affiliated entities to prevent them 

from violating the January 9 Order and entry of a restraining order against those entities [Adv Proc. 

No. 21-03000 Docket No 1] (collectively, the “Dondero Post-Petition Litigation”). 

78. Findings Regarding Dondero Post-Petition Litigation. The Bankruptcy 

Court finds that the Dondero Post-Petition Litigation was a result of Mr. Dondero failing to obtain 

creditor support for his plan proposal and consistent with his comments, as set forth in Mr. Seery’s 

credible testimony, that if Mr. Dondero’s plan proposal was not accepted, he would “burn down 

the place.” The Bankruptcy Court concludes that without appropriate protections in place, in the 

form of the Gatekeeper Provision, Mr. Dondero and his related entities will likely commence 

litigation against the Protected Parties after the Effective Date and do so in jurisdictions other than 

the Bankruptcy Court in an effort to obtain a forum which Mr. Dondero perceives will be more 

hospitable to his claims. The Bankruptcy Court also finds, based upon Mr. Seery’s testimony, that 

the threat of continued litigation by Mr, Dondero and his related entities after the Effective Date 

will impede efforts by the Claimant Trust to monetize assets for the benefit of creditors and result 

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in lower distributions to creditors because of costs and distraction such litigation or the threats of 

such litigation would cause. 

79. Necessity of Gatekeeper Provision. The Bankruptcy Court further finds 

that unless the Bankruptcy Court approves the Gatekeeper Provision, the Claimant Trustee and the 

Claimant Trust Oversight Board will not be able to obtain D&O insurance, the absence of which 

will present unacceptable risks to parties currently willing to serve in such roles. The Bankruptcy 

Court heard testimony from Mark Tauber, a Vice President with AON Financial Services, the 

Debtor’s insurance broker (“AON”), regarding his efforts to obtain D&O insurance. Mr. Tauber 

credibly testified that of all the insurance carriers that AON approached to provide D&O insurance 

coverage after the Effective Date, the only one willing to do so without an exclusion for claims 

asserted by Mr. Dondero and his affiliates otherwise requires that this Order approve the 

Gatekeeper Provision. Based on the foregoing, the Bankruptcy Court finds that the Gatekeeper 

Provision is necessary and appropriate in light of the history of the continued litigiousness of Mr. 

Dondero and his related entities in this Chapter 11 Case and necessary to the effective and efficient 

administration, implementation and consummation of the Plan and is appropriate pursuant to 

Carroll v. Abide (In re Carroll) 850 F.3d 811 (5th Cir. 2017). Approval of the Gatekeeper 

Provision will prevent baseless litigation designed merely to harass the post-confirmation entities 

charged with monetizing the Debtor’s assets for the benefit of its economic constituents, will avoid 

abuse of the court system and preempt the use of judicial time that properly could be used to 

consider the meritorious claims of other litigants. Any suit against a Protected Party would 

effectively be a suit against the Debtor, and the Debtor may be required to indemnify the Protected 

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Parties under the Limited Partnership Agreement, which will remain in effect through the Effective 

Date, or those certain Indemnification and Guaranty Agreements, dated January 9, 2020, between 

Strand, the Debtor, and each Independent Director, following the Confirmation Date as each such 

agreement will be assumed pursuant to 11 U.S.C. § 365 pursuant to the Plan. 

80. Statutory Authority to Approve Gatekeeper Provision. The 

Bankruptcy Court finds it has the statutory authority to approve the Gatekeeper Provision under 

sections 1123(a)(5), 1123(b)(6), 1141, 1142(b), and 105(a). The Gatekeeper Provision is also 

within the spirit of the Supreme Court’s “Barton Doctrine.” Barton v. Barbour, 104 U.S. 126 

(1881). The Gatekeeper Provision is also consistent with the notion of a prefiling injunction to 

deter vexatious litigants, that has been approved by the Fifth Circuit in such cases as Baum v. Blue 

Moon Ventures, LLC, 513 F.3d 181, 189 (5th Cir. 2008), and In re Carroll, 850 F.3d 811 (5th Cir. 

2017). 

81. Jurisdiction to Implement Gatekeeper Provision. The Bankruptcy Court 

finds that it will have jurisdiction after the Effective Date to implement the Gatekeeper Provision 

as post-confirmation bankruptcy court jurisdiction has been interpreted by the Fifth Circuit under 

United States Brass Corp. v. Travelers Ins. Group, Inc. (In re United States Brass Corp.), 301 F.3d 

296 (5th Cir. 2002) and EOP-Colonnade of Dallas Ltd. P’Ship v. Faulkner (In re Stonebridge 

Techs., Inc.), 430 F.3d 260 (5th Cir. 2005). Based upon the rationale of the Fifth Circuit in Villegas 

v. Schmidt, 788 F.3d 156, 158-59 (5th Cir. 2015), the Bankruptcy Court’s jurisdiction to act as a 

gatekeeper does not violate Stern v. Marshall. The Bankruptcy Court’s determination of whether 

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a claim is colorable, which the Bankruptcy Court has jurisdiction to determine, is distinct from 

whether the Bankruptcy Court would have jurisdiction to adjudicate any claim it finds colorable. 

82. Resolution of Objections of Scott Ellington and Isaac Leventon. Each 

of Scott Ellington (“Mr. Ellington”) and Isaac Leventon (“Mr. Leventon”) (each, a “Senior 

Employee Claimant”) has asserted certain claims for liquidated but unpaid bonus amounts for the 

following periods: 2016, 2017, and 2018, as set forth in Exhibit A to that certain Senior Employees’ 

Limited Objection to Debtor’s Fifth Amended Plan of Reorganization [Docket No. 1669] (the 

“Senior Employees’ Objection”) (for each of Mr. Ellington and Mr. Leventon, the “Liquidated 

Bonus Claims”). 

a. Mr. Ellington has asserted Liquidated Bonus Claims in the aggregate amount of 

$1,367,197.00, and Mr. Leventon has asserted Liquidated Bonus Claims in the 

aggregate amount of $598,198.00. Mr. Ellington received two Ballots10 – a Ballot 

for Class 7 of the Plan and a Ballot for Class 8 of the Plan. Mr. Ellington completed 

and timely returned both of such Ballots, voted to reject the Plan, and elected to 

have his Class 8 Liquidated Bonus Claims treated under Class 7 of the Plan, subject 

to the objections and reservations of rights set forth in the Senior Employees’ 

Objection. If Mr. Ellington is permitted to elect Class 7 treatment for his Liquidated 

Bonus Claims, then the maximum amount of his Liquidated Bonus Claims will be 

$1,000,000. 

b. Mr. Leventon received two Ballots—a Ballot for Class 7 of the Plan and a Ballot 

for Class 8 of the Plan. Mr. Leventon completed and timely returned both of such 

Ballots and voted each such Ballots to rejected the Plan. 

c. The Senior Employees’ Objection, among other things, objects to the Plan on the 

grounds that the Debtor improperly disputes the right of Mr. Ellington to elect Class 

7 treatment for his Liquidated Bonus Claims and Mr. Leventon’s entitlement to 

receive Class 7 Convenience Class treatment for his Liquidated Bonus Claims. The 

Debtor contended that neither Mr. Ellington or Mr. Leventon were entitled to elect 

to receive Class 7 Convenience Class treatment on account of their Liquidated 

10 As defined in the Plan, “Ballot” means the forms(s) distributed to holders of Impaired Claims or Equity Interests 

entitled to vote on the Plan on which to indicate their acceptance or rejection of the Plan. 

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Bonus Claims under the terms of the Plan, the Disclosure Statement Order or 

applicable law. 

d. The Debtor and Mr. Ellington and Mr. Leventon negotiated at arms’ length in an 

effort to resolve all issues raised in the Senior Employee’s Objection, including 

whether or not Mr. Ellington and Mr. Leventon were entitled to Class 7 

Convenience Class treatment of their Liquidated Bonus Claims. As a result of such 

negotiation, the Debtor, Mr. Ellington, and Mr. Leventon have agreed to the 

settlement described in paragraphs 82(e) through 82(k) below and approved and 

effectuated pursuant to decretal paragraphs RR through SS (the “Senior Employees' 

Settlement”). 

e. Under the terms of the Senior Employees' Settlement, the Debtor has the right to 

elect one of two treatments of the Liquidated Bonus Claims for a Senior Employee 

Claimant. Under the first treatment option (“Option A”), the Liquidated Bonus 

Claims will be entitled to be treated in Class 7 of the Plan, and the Liquidated Bonus 

Claims will be entitled to receive payment in an amount equal to 70.125% of the 

Class 7 amount of the Liquidated Bonus Claims, subject to the Liquidated Bonus 

Claims becoming Allowed Claims under the terms of the Plan. Under this 

calculation, Mr. Ellington would be entitled to receive $701,250.00 on account of 

his Class 7 Convenience Class Claim when and as Allowed under the Plan, and Mr. 

Leventon would be entitled to receive $413,175.10 on account of his Class 7 

Convenience Class Claim when and as Allowed under the Plan. If, however, any 

party in interest objects to the allowance of the Senior Employee Claimant's 

Liquidated Bonus Claims and does not prevail in such objection, then such Senior 

Employee Claimant will be entitled to a payment in an amount equal to 85% of his 

Allowed Liquidated Bonus Claims (subject, in the case of Mr. Ellington, to the cap 

imposed on Class 7 Claims). In addition, under Option A, each of Mr. Ellington 

and Mr. Leventon would retain their respective rights to assert that the Liquidated 

Bonus Claims are entitled to be treated as Administrative Expense Claims, as 

defined in Article I.B.2. of the Plan, in which case the holder of such Liquidated 

Bonus Claims would be entitled to payment in full of the Allowed Liquidated 

Bonus Claims. Under Option A, parties in interest would retain the right to object 

to any motion seeking payment of the Liquidated Bonus Amounts as 

Administrative Expenses. 

f. Under the second treatment option (“Option B”), the Debtor would agree that the 

Senior Employee Claimant has Allowed Liquidated Bonus Claims, no longer 

subject to objection by any party in interest, in the amounts of the Liquidated Bonus 

Claims (subject, in the case of Mr. Ellington, to the cap imposed by Class 7). If the 

Debtor elects Option B as to a Senior Employee Claimant, then such Senior 

Employee Claimant would be entitled to a payment on account of his Allowed 

Liquidated Bonus Claims in an amount equal to 60% of the amount of the 

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Liquidated Bonus Claims (which, in Mr. Ellington’s case, would be $600,000 and 

in Mr. Leventon’s case, would be $358,918.80), and such payment would be the 

sole recovery on account of such Allowed Liquidated Bonus Claims. 

g. The Debtor may, with the consent of the Committee, elect Option B with respect to 

a Senior Employee Claimant at any time prior to the occurrence of the Effective 

Date. If the Debtor does not make an election, then Option A will apply. 

h. Under either Option A or Option B, Mr. Ellington and Mr. Leventon will retain all 

their rights with respect to all Claims other than the Liquidated Bonus Amounts, 

including, but not limited to, their Class 6 PTO Claims, other claims asserted as 

Class 8 General Unsecured Claims, the Senior Employees’ claims for 

indemnification against the Debtor, and any other claims that they may assert 

constitute Administrative Expense Claims, and any other such Claims are subject 

to the rights of any party in interest to object to such Claims, and the Debtor reserves 

any all of its rights and defenses in connection therewith. 

i. Subject to entry of this Confirmation Order and as set forth and announced on the 

record at the hearing on confirmation of the Plan and no party objecting thereto, 

Mr. Ellington and Mr. Leventon agreed to change the votes in their respective 

Ballots from rejection to acceptance of the Plan and to withdraw the Senior 

Employees’ Objection. 

j. The Senior Employees’ Settlement represents a valid exercise of the Debtor’s 

business judgment and satisfies the requirements for a compromise under 

Bankruptcy Rule 9019(a). 

k. For the avoidance of doubt, neither Mr. Leventon nor Mr. Ellington shall be a 

Released Party under the Plan regardless of how the Senior Employee Claimants’ 

Claims are to be treated hereunder. 

Based upon the foregoing findings, and upon the record made before the Bankruptcy Court 

at the Confirmation Hearing, and good and sufficient cause appearing therefor, it is hereby 

ORDERED, ADJUDGED AND DECREED THAT:

A. Confirmation of the Plan. The Plan is approved in its entirety and 

CONFIRMED under section 1129 of the Bankruptcy Code. The terms of the Plan, including the 

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001176

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Plan Supplements and Plan Modifications, are incorporated by reference into and are an integral 

part of this Confirmation Order.11

B. Findings of Fact and Conclusions of Law. The findings of fact and the 

conclusions of law set forth in this Confirmation Order and on the record of the Confirmation 

Hearing constitute findings of fact and conclusions of law in accordance with Bankruptcy Rule 

7052, made applicable to this proceeding by Bankruptcy Rule 9014. All findings of fact and 

conclusion of law announced by the Bankruptcy Court at the Confirmation Hearing in relation to 

confirmation of the Plan are hereby incorporated into this Confirmation Order. To the extent that 

any of the following constitutes findings of fact or conclusions of law, they are adopted as such. 

To the extent any findings of fact or conclusions of law set forth in this Confirmation Order 

(including any findings of fact or conclusions of law announced by the Bankruptcy Court at the 

Confirmation Hearing and incorporated herein) constitutes an order of the Bankruptcy Court, and 

is adopted as such. 

C. Objections. Any resolution or disposition of objections to confirmation of 

the Plan or otherwise ruled upon by the Bankruptcy Court on the record of the Confirmation 

Hearing is hereby incorporated by reference. All objections and all reservations of rights 

pertaining to confirmation of the Plan that have not been withdrawn, waived or settled are 

overruled on the merits, except as otherwise specifically provided in this Confirmation Order. 

D. Plan Supplements and Plan Modifications. The filing with the 

Bankruptcy Court of the Plan Supplements and the Plan Modifications constitutes due and 

11 The Plan is attached hereto as Exhibit A. 

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sufficient notice thereof. Accordingly, pursuant to section 1127(a) of the Bankruptcy Code and 

Bankruptcy Rule 3019, the Plan Modifications and the Plan Supplements do not require additional 

disclosure under section 1125 of the Bankruptcy Code or resolicitation of votes under section 1126 

of the Bankruptcy Code, nor do they require that Holders of Claims or Equity Interests be afforded 

an opportunity to change previously cast acceptances or rejections of the Plan. The Plan 

Modifications and the Plan Supplements constitute the Plan pursuant to section 1127(a) of the 

Bankruptcy Code. Accordingly, the Plan, as modified, is properly before the Bankruptcy Court 

and all votes cast with respect to the Plan prior to such modification shall be binding and shall 

apply with respect to the Plan. 

E. Deemed Acceptance of Plan. In accordance with section 1127 of the 

Bankruptcy Code and Bankruptcy Rule 3019, all Holders of Claims and Equity Interests who voted 

to accept the Plan (or whom are conclusively presumed to accept the Plan) are deemed to have 

accepted the Plan as modified by the Plan Modifications. No holder of a Claim shall be permitted 

to change its vote as a consequence of the Plan Modifications. 

F. Vesting of Assets in the Reorganized Debtor. Except as otherwise 

provided in the Plan or this Confirmation Order, on or after the Effective Date, all Reorganized 

Debtor Assets will vest in the Reorganized Debtor, free and clear of all Liens, Claims, charges or 

other encumbrances pursuant to section 1141(c) of the Bankruptcy Code, except with respect to 

such Liens, Claims, charges, and other encumbrances that are specifically preserved under the Plan 

upon the Effective Date. The Reorganized Debtor shall be the exclusive trustee of the Reorganized 

Debtor Assets for purposes of 31 U.S.C. § 3713(b) and 26 U.S.C. § 6012(b)(3), as well as the 

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representative of the Estate appointed pursuant to section 1123(b)(3)(B) of the Bankruptcy Code 

with respect to the Reorganized Debtor Assets. 

G. Effectiveness of All Actions. All actions contemplated by the Plan, 

including all actions in connection with the Claimant Trust Agreement, the Senior Employee 

Stipulation, the New GP LLC Documents, the New Frontier Note, the Reorganized Limited 

Partnership Agreement, the Litigation Sub-Trust Agreement, and the other Plan Documents, are 

authorized to be taken on, prior to, or after the Effective Date, as applicable, under this 

Confirmation Order, without further application to or order of the Bankruptcy Court, or further 

action by the directors, managers, officers or partners of the Debtor or the Reorganized Debtor and 

with the effect that such actions had been taken by unanimous action of such parties. 

H. Restructuring Transactions. The Debtor or Reorganized Debtor, as 

applicable, are authorized to enter into and effectuate the Restructuring provided under the Plan, 

including, without limitation, the entry into and consummation of the transactions contemplated 

by the Claimant Trust Agreement, the Senior Employee Stipulation, the New GP LLC Documents, 

the New Frontier Note, the Reorganized Limited Partnership Agreement, the Litigation Sub-Trust 

Agreement, and the other Plan Documents, and may take any actions as may be necessary or 

appropriate to effect a corporate restructuring of its business or a corporate restructuring of the 

overall corporate structure of the Reorganized Debtor, as and to the extent provided in the Plan. 

Any transfers of assets or equity interests effected or any obligations incurred through the 

Restructuring pursuant to the Plan are hereby approved and shall not constitute fraudulent 

conveyances or fraudulent transfers or otherwise be subject to avoidance. 

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I. Preservation of Causes of Action. Unless a Cause of Action against a 

Holder of a Claim or an Equity Interest or other Entity is expressly waived, relinquished, released, 

compromised or settled in the Plan or any Final Order (including, without limitation, this 

Confirmation Order), such Cause of Action is expressly reserved for later adjudication by the 

Reorganized Debtor, the Litigation Sub-Trust, or the Claimant Trust, as applicable (including, 

without limitation, Causes of Action not specifically identified or of which the Debtor may 

presently be unaware or that may arise or exist by reason of additional facts or circumstances 

unknown to the Debtor at this time or facts or circumstances that may change or be different from 

those the Debtor now believes to exist) and, therefore, no preclusion doctrine, including, without 

limitation, the doctrines of res judicata, collateral estoppel, issue preclusion, claim preclusion, 

waiver, estoppel (judicial, equitable or otherwise) or laches will apply to such Causes of Action as 

a consequence of the confirmation, effectiveness, or consummation of the Plan based on the 

Disclosure Statement, the Plan, or this Confirmation Order, except where such Causes of Action 

have been expressly released in the Plan or any other Final Order (including, without limitation, 

this Confirmation Order). In addition, the right of the Reorganized Debtor, the Claimant Trust, or 

the Litigation Sub-Trust to pursue or adopt any claims alleged in any lawsuit in which the Debtor 

is a plaintiff, defendant or an interested party, against any Entity, including, without limitation, the 

plaintiffs or co-defendants in such lawsuits, is expressly reserved. 

J. Independent Board of Directors of Strand. The terms of the current 

Independent Directors shall expire on the Effective Date without the need for any further or other 

action by any of the Independent Directors. For avoidance of doubt, the Assumed Contracts 

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include the Indemnification and Guaranty Agreement between Highland Capital Management, 

Strand Advisors, Inc. and James Seery; the Indemnification and Guaranty Agreement between 

Highland Capital Management, Strand Advisors, Inc. and John Dubel and Indemnification and 

Guaranty Agreement between Highland Capital Management, Strand Advisors, Inc. and Russell 

Nelms and shall each remain in full force and effect notwithstanding the expiration of the terms of 

any Independent Directors. 

K. Cancellation of Equity Interests and Issuance of New Partnership 

Interests. On the Effective Date, all Class A Limited Partnership Interests, including the Class A 

Limited Partnership Interests held by Strand, as general partner, and Class B/C Limited 

Partnerships in the Debtor will be deemed cancelled, and all obligations or debts owed by, or 

Claims against, the Debtor on account of, or based upon, such Class A Limited Partnership 

Interests and Class B/C Limited Partnership Interests shall be deemed as cancelled, released, and 

discharged, including all obligations or duties by the Debtor relating to the Equity Interests in any 

of the Debtor’s formation documents, including the Limited Partnership Agreement. As of the 

Effective Date and pursuant to the Plan, new Class A Limited Partnership Interests in the 

Reorganized Debtor will be issued to the Claimant Trust and New GP LLC. The Claimant Trust, 

as limited partner, will ratify New GP LLC’s appointment as general partner of the Reorganized 

Debtor, and on and following the Effective Date, the Claimant Trust will be the Reorganized 

Debtor’s limited partner and New GP LLC will be its general partner. The Claimant Trust, as 

limited partner, and New GP LLC, as general partner, will execute the Reorganized Limited 

Partnership Agreement, which will amend and restate, in all respects, the Debtor’s current Limited 

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Partnership Agreement. Following the Effective Date, the Reorganized Debtor will be managed 

consistent with the terms of the Reorganized Limited Partnership Agreement by New GP LLC. 

The sole managing member of New GP LLC will be the Claimant Trust, and the Claimant Trustee 

will be the sole officer of New GP LLC on the Effective Date. 

L. Transfer of Assets to Claimant Trust. On or prior to the Effective Date, 

the Debtor shall irrevocably transfer and shall be deemed to have irrevocably transferred to the 

Claimant Trust all of its rights, title, and interest in and to all of the Claimant Trust Assets, and in 

accordance with section 1141 of the Bankruptcy Code, the Claimant Trust Assets shall 

automatically vest in the Claimant Trust free and clear of all Claims, Liens, encumbrances, or 

interests subject only to the Claimant Trust Interests and the Claimant Trust Expenses, as provided 

for in the Claimant Trust Agreement, and such transfer shall be exempt from any stamp, real estate 

transfer, mortgage from any stamp, transfer, reporting, sales, use, or other similar tax. Following 

the Effective Date, the Claimant Trust will administer the Claimant Trust Assets pursuant to the 

Plan and the Claimant Trust Agreement. 

M. Transfer of Estate Claims to Litigation Sub-Trust. On or prior to the 

Effective Date, the Claimant Trust shall irrevocably transfer and shall be deemed to have 

irrevocably transferred to the Litigation Sub-Trust all of the Claimant Trust’s rights, title, and 

interest in and to all of the Estate Claims as successor in interest to the Debtor, and in accordance 

with section 1141 of the Bankruptcy Code, the Estate Claims shall automatically vest in the 

Litigation Sub-Trust free and clear of all Claims, Liens, encumbrances, or interests subject only to 

the Litigation Sub-Trust Interests and Litigation Sub-Trust Expenses. The Litigation Trustee will 

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be authorized to investigate, pursue, and otherwise resolve the Estate Claims pursuant to the terms 

of the Litigation Sub-Trust Agreement and the Plan, including as successor in interest to the Debtor 

or Committee, as applicable, in any litigation commenced prior to the Effective Date in which 

Estate Claims are asserted. 

N. Compromise of Controversies. In consideration for the distributions and 

other benefits, including releases, provided under the Plan, the provisions of the Plan constitute a 

good faith compromise and settlement of all Claims, Equity Interests, and controversies resolved 

under the Plan and the entry of this Confirmation Order constitutes approval of such compromise 

and settlement under Bankruptcy Rule 9019. 

O. Objections to Claims. The Claims Objection Deadline shall be the date 

that is 180 days after the Effective Date, provided, however, that the Claims Objection Deadline 

may be extended by the Bankruptcy Court upon a motion by the Claimant Trustee and as otherwise 

provided under the Plan. 

P. Assumption of Contracts and Leases. Effective as of the date of this 

Confirmation Order, each of the Assumed Contacts shall be assumed by the Debtor without the 

need for any further notice to or action, order, or approval of the Bankruptcy Court, under section 

365 of the Bankruptcy Code and the payment of Cures, if any, shall be paid in accordance with the 

Plan. Each Assumed Contract shall include all modifications, amendments, supplements, 

restatements, or other agreements related thereto, and all rights related thereto, if any, including 

all easements, licenses, permits, rights, privileges, immunities, options, rights of first refusal, and 

any other interests. Modifications, amendments, supplements, and restatements to any of the 

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001183

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Assumed Contracts that have been executed by the Debtor during the Chapter 11 Case shall not 

be deemed to alter the prepetition nature of such Assumed Contracts or the validity, priority, or 

amount of any Claims that may arise in connection therewith. Assumption of the Assumed 

Contracts pursuant to Article V.A of the Plan and full payment of any applicable Cure pursuant to 

the Plan shall result in the full release and satisfaction of any Cures, Claims, or defaults, whether 

monetary or nonmonetary, including defaults of provisions restricting the change in control or 

ownership interest composition, or other bankruptcy-related defaults, arising under any Assumed 

Contracts. 

Q. Rejection of Contracts and Leases. Unless previously assumed during the 

pendency of the Chapter 11 Case or pursuant to the Plan, all other Executory Contracts and 

Unexpired Leases are rejected as of the date of the entry of this Confirmation Order and pursuant 

to the terms of the Plan. To the extent that any party asserts any damages resulting from the 

rejection of any Executory Contract or Unexpired Lease, such claim must be filed within thirty 

(30) days following entry of this Confirmation Order, or such claim will be forever barred and 

disallowed against the Reorganized Debtor. 

R. Assumption of Issuer Executory Contracts. On the Confirmation Date, 

the Debtor will assume the agreements set forth on Exhibit B hereto (collectively, the “Issuer 

Executory Contracts”) pursuant to section 365 of the Bankruptcy Code and Article V of the Plan. 

In full and complete satisfaction of its obligation to cure outstanding defaults under section 

365(b)(1) of the Bankruptcy Code, the Debtor or, as applicable, any successor manager under the 

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001184

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Issuer Executory Contracts (collectively, the “Portfolio Manager”) will pay to the Issuers12 a 

cumulative amount of $525,000 (the “Cure Amount”) as follows: 

a. $200,000 in cash on the date that is five business days from the Effective Date, with 

such payment paid directly to Schulte Roth & Zabel LLP (“SRZ”) in the amount of 

$85,714.29, Jones Walker LLP (“JW”) in the amount of $72,380.95, and Maples 

Group (“Maples” and collectively with SRZ and JW, the “Issuers’ Counsel”) in the 

amount of $41,904.76 as reimbursement for the attorney’s fees and other legal 

expenses incurred by the Issuers in connection with the Debtor’s bankruptcy case; 

and 

b. $325,000 in four equal quarterly payments of $81,250.00 (each, a “Payment”), 

which amounts shall be paid to SRZ in the amount of $34,821.43, JW in the amount 

of $29,404.76, and Maples in the amount of $17,023.81 as additional 

reimbursement for the attorney’s fees and other legal expenses incurred by the 

Issuers in connection with the Debtor’s bankruptcy case (i) from any management 

fees actually paid to the Portfolio Manager under the Issuer Executory Contracts 

(the “Management Fees”), and (ii) on the date(s) Management Fees are required to 

be paid under the Issuer Executory Contracts (the “Payment Dates”), and such 

obligation shall be considered an irrevocable direction from the Debtor and the 

Bankruptcy Court to the relevant CLO Trustee to pay, on each Payment Date, the 

Payment to Issuers’ Counsel, allocated in the proportion set forth in such 

agreement; provided, however, that (x) if the Management Fees are insufficient to 

make any Payment in full on a Payment Date, such shortfall, in addition to any 

other amounts due hereunder, shall be paid out of the Management Fees owed on 

the following Payment Date, and (y) nothing herein shall limit either Debtor’s 

liability to pay the amounts set forth herein, nor the recourse of the Issuers or 

Issuers’ Counsel to the Debtor, in the event of any failure to make any Payment. 

S. Release of Issuer Claims. Effective as of the Confirmation Date, and to 

the maximum extent permitted by law, each Issuer on behalf of itself and each of its current and 

former advisors, trustees, directors, officers, managers, members, partners, employees, 

beneficiaries, shareholders, agents, participants, subsidiaries, parents, successors, designees, and 

12 The “Issuers” are: Brentwood CLO, Ltd., Gleneagles CLO, Ltd., Greenbriar CLO, Ltd., Highland CLO 2018-1, 

Ltd., Highland Legacy Limited, Highland Loan Funding V Ltd., Highland Park CDO I, Ltd., Pam Capital Funding 

LP, Rockwall CDO II Ltd., Rockwall CDO Ltd., Southfork CLO Ltd., Stratford CLO Ltd., Westchester CLO, Ltd., 

Aberdeen Loan Funding, Ltd., Eastland CLO, Ltd., Grayson CLO, Ltd., Highland Credit Opportunities CDO Ltd., 

Jasper CLO, Ltd., Liberty Cayman Holdings, Ltd., Liberty CLO, Ltd., Red River CLO, Ltd., Valhalla CLO, Ltd. 

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001185

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assigns hereby forever, finally, fully, unconditionally, and completely releases, relieves, acquits, 

remises, and exonerates, and covenants never to sue, (i) the Debtor and (ii) the Professionals 

retained by the Debtor and the Committee in the Chapter 11 Case, the Independent Directors, the 

CEO/CRO, and with respect to the Persons listed in this subsection (ii), such Person’s Related 

Persons (collectively, the “Debtor Released Parties”), for and from any and all claims, debts, 

liabilities, demands, obligations, promises, acts, agreements, liens, losses, costs and expenses 

(including, without limitation, attorney’s fees and related costs), damages, injuries, suits, actions, 

and causes of action of whatever kind or nature, whether known or unknown, suspected or 

unsuspected, matured or unmatured, liquidated or unliquidated, contingent or fixed, at law or in 

equity, statutory or otherwise, including, without limitation, any claims, defenses, and affirmative 

defenses, whether known or unknown, including, without limitation, those which were or could 

have been asserted in, in connection with, or with respect to the Bankruptcy Case (collectively, the 

“Issuer Released Claims”). 

T. Release of Debtor Claims against Issuer Released Parties. Upon entry 

of this Order, and to the maximum extent permitted by law, the Debtor hereby forever, finally, 

fully, unconditionally, and completely releases, relieves, acquits, remises, and exonerates, and 

covenants never to sue [(i) each Issuer and (ii) Wendy Ebanks, (iii) Yun Zheng, (iv) Laura 

Chisholm, (v) Mora Goddard, (vi) Stacy Bodden, (vii) Suzan Merren (viii) Scott Dakers, (ix) Samit 

Ghosh, (x) Inderjit Singh, (xi) Ellen Christian, (xii) Andrew Dean, (xiii) Betsy Mortel, (xiv) David 

Hogan, (xv) Cleveland Stewart, (xvi) Rachael Rankin, (xvii) Otelia Scott, (xviii) Martin Couch, 

(xx) Ferona Bartley-Davis, (xxi) Charlotte Cloete, (xxii) Christina McLean, (xxiii) Karen Ellerbe, 

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001186

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(xxiv) Gennie Kay Bigord, (xxv) Evert Brunekreef, (xxvii) Evan Charles Burtton (collectively, 

the “Issuer Released Parties”),] for and from any and all claims, debts, liabilities, demands, 

obligations, promises, acts, agreements, liens, losses, costs and expenses (including, without 

limitation, attorney’s fees and related costs), damages, injuries, suits, actions, and causes of action 

of whatever kind or nature, whether known or unknown, suspected or unsuspected, matured or 

unmatured, liquidated or unliquidated, contingent or fixed, at law or in equity, statutory or 

otherwise, including, without limitation, any claims, defenses, and affirmative defenses, whether 

known or unknown, which were or could have been asserted in, in connection with, or with respect 

to the Bankruptcy Case (collectively, the “Debtor Released Claims”); provided, however, that 

notwithstanding anything herein to the contrary, the release contained herein will apply to the 

Issuer Released Parties set forth in subsection (ii) above only with respect to Debtor Released 

Claims arising from or relating to the Issuer Executory Contracts. Notwithstanding anything in 

this Order to the contrary, the releases set forth in paragraphs S and T hereof will not apply with 

respect to the duties, rights, or obligations of the Debtor or any Issuer hereunder. 

U. Authorization to Consummate. The Debtor is authorized to consummate 

the Plan after the entry of this Confirmation Order subject to satisfaction or waiver of the 

conditions precedent to the Effective Date of the Plan set forth in Article VIII.A of the Plan. The 

Plan shall not become effective unless and until the conditions set forth in Article VIII.A of the 

Plan have been satisfied, or otherwise waived pursuant to Article VIII.B of the Plan. 

V. Professional Compensation. All requests for payment of Professional Fee 

Claims for services rendered and reimbursement of expenses incurred prior to the Effective Date 

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001187

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must be filed no later than sixty (60) days after the Effective Date. The Bankruptcy Court shall 

determine the Allowed amounts of such Professional Fee Claims after notice and an opportunity 

for hearing in accordance with the procedures established by the Bankruptcy Code and the 

Bankruptcy Court. The Debtor shall fund the Professional Fee Reserve as provided under the Plan. 

The Reorganized Debtor shall pay Professional Fee Claims in Cash in the amounts the Bankruptcy 

Court allows. The Debtor is authorized to pay the pre-Effective Date fees and expenses of all 

ordinary course professionals in the ordinary course of business without the need for further 

Bankruptcy Court order or approval. From and after the Effective Date, any requirement that 

Professionals comply with sections 327 through 331 and 1103 (if applicable) of the Bankruptcy 

Code in seeking retention or compensation for services rendered after such date shall terminate, 

and the Reorganized Debtor or Claimant Trustee, as applicable, may employ and pay any 

Professional or Entity employed in the ordinary course of the Debtor’s business without any further 

notice to or action, order, or approval of the Bankruptcy Court. 

W. Release, Exculpation, Discharge, and Injunction Provisions. The 

following release, exculpation, discharge, and injunction provisions set forth in the Plan are 

approved and authorized in their entirety, and such provisions are effective and binding on 

all parties and Entities to the extent provided therein. 

X. Discharge of Claims and Termination of Interests. To the fullest extent 

provided under section 1141(d)(1)(A) and other applicable provisions of the Bankruptcy Code, 

except as otherwise expressly provided by the Plan or this Confirmation Order, all consideration 

distributed under the Plan will be in exchange for, and in complete satisfaction, settlement, 

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001188

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discharge, and release of, all Claims and Equity Interests of any kind or nature whatsoever against 

the Debtor or any of its Assets or properties, and regardless of whether any property will have been 

distributed or retained pursuant to the Plan on account of such Claims or Equity Interests. Except 

as otherwise expressly provided by the Plan or this Confirmation Order, upon the Effective Date, 

the Debtor and its Estate will be deemed discharged and released under and to the fullest extent 

provided under section 1141(d)(1)(A) and other applicable provisions of the Bankruptcy Code 

from any and all Claims and Equity Interests of any kind or nature whatsoever, including, but not 

limited to, demands and liabilities that arose before the Confirmation Date, and all debts of the 

kind specified in section 502(g), 502(h), or 502(i) of the Bankruptcy Code. 

Y. Exculpation. Subject in all respects to Article XII.D of the Plan, to the 

maximum extent permitted by applicable law, no Exculpated Party will have or incur, and each 

Exculpated Party is hereby exculpated from, any claim, obligation, suit, judgment, damage, 

demand, debt, right, Cause of Action, remedy, loss, and liability for conduct occurring on or after 

the Petition Date in connection with or arising out of (i) the filing and administration of the Chapter 

11 Case; (ii) the negotiation and pursuit of the Disclosure Statement, the Plan, or the solicitation 

of votes for, or confirmation of, the Plan; (iii) the funding or consummation of the Plan (including 

the Plan Supplement) or any related agreements, instruments, or other documents, the solicitation 

of votes on the Plan, the offer, issuance, and Plan Distribution of any securities issued or to be 

issued pursuant to the Plan, including the Claimant Trust Interests, whether or not such Plan 

Distributions occur following the Effective Date; (iv) the implementation of the Plan; and (v) any 

negotiations, transactions, and documentation in connection with the foregoing clauses (i)-(v); 

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001189

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provided, however, the foregoing will not apply to (a) any acts or omissions of an Exculpated Party 

arising out of or related to acts or omissions that constitute bad faith, fraud, gross negligence, 

criminal misconduct, or willful misconduct or (b) Strand or any Employee other than with respect 

to actions taken by such Entities from the date of appointment of the Independent Directors through 

the Effective Date. The Plan’s exculpation shall be in addition to, and not in limitation of, all other 

releases, indemnities, exculpations, any other applicable law or rules, or any other provisions of 

the Plan, including Article IV.C.2 of the Plan, protecting such Exculpated Parties from liability. 

Z. Releases by the Debtor. On and after the Effective Date, each Released 

Party is deemed to be, hereby conclusively, absolutely, unconditionally, irrevocably, and forever 

released and discharged by the Debtor and the Estate, in each case on behalf of themselves and 

their respective successors, assigns, and representatives, including, but not limited to, the Claimant 

Trust and the Litigation Sub-Trust from any and all Causes of Action, including any derivative 

claims, asserted on behalf of the Debtor, whether known or unknown, foreseen or unforeseen, 

matured or unmatured, existing or hereafter arising, in law, equity, contract, tort or otherwise, that 

the Debtor or the Estate would have been legally entitled to assert in their own right (whether 

individually or collectively) or on behalf of the holder of any Claim against, or Interest in, a Debtor 

or other Person. Notwithstanding anything contained herein to the contrary, the foregoing release 

does not release: (i) any obligations of any party under the Plan or any document, instrument, or 

agreement executed to implement the Plan, (ii) the rights or obligations of any current employee 

of the Debtor under any employment agreement or plan, (iii) the rights of the Debtor with respect 

to any confidentiality provisions or covenants restricting competition in favor of the Debtor under 

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001190

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any employment agreement with a current or former employee of the Debtor, (iv) any Avoidance 

Actions, or (v) any Causes of Action arising from willful misconduct, criminal misconduct, actual 

fraud, or gross negligence of such applicable Released Party as determined by Final Order of the 

Bankruptcy Court or any other court of competent jurisdiction. 

AA. Injunction. Upon entry of this Confirmation Order, all Enjoined 

Parties are and shall be permanently enjoined, on and after the Effective Date, from taking 

any actions to interfere with the implementation or consummation of the Plan. Except as 

expressly provided in the Plan, this Confirmation Order, or a separate order of the 

Bankruptcy Court, all Enjoined Parties are and shall be permanently enjoined, on and after 

the Effective Date, with respect to any Claims and Equity Interests, from directly or 

indirectly (i) commencing, conducting, or continuing in any manner, any suit, action, or 

other proceeding of any kind (including any proceeding in a judicial, arbitral, administrative 

or other forum) against or affecting the Debtor or the property of the Debtor, (ii) enforcing, 

levying, attaching (including any prejudgment attachment), collecting, or otherwise 

recovering, enforcing, or attempting to recover or enforce, by any manner or means, any 

judgment, award, decree, or order against the Debtor or the property of the Debtor, (iii) 

creating, perfecting, or otherwise enforcing in any manner, any security interest, lien or 

encumbrance of any kind against the Debtor or the property of the Debtor, (iv) asserting any 

right of setoff, directly or indirectly, against any obligation due to the Debtor or against

property or interests in property of the Debtor, except to the limited extent permitted under 

Sections 553 and 1141 of the Bankruptcy Code, and (v) acting or proceeding in any manner, 

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001191

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in any place whatsoever, that does not conform to or comply with the provisions of the Plan. 

The injunctions set forth in the Plan and this Confirmation Order shall extend to, and apply 

to any act of the type set forth in any of clauses (i)-(v) of the immediately preceding 

paragraph against any successors of the Debtor, including, but not limited to, the 

Reorganized Debtor, the Litigation Sub-Trust, and the Claimant Trust and their respective 

property and interests in property. Subject in all respects to Article XII.D of the Plan, no 

Enjoined Party may commence or pursue a claim or cause of action of any kind against any 

Protected Party that arose or arises from or is related to the Chapter 11 Case, the negotiation 

of the Plan, the administration of the Plan or property to be distributed under the Plan, the 

wind down of the business of the Debtor or Reorganized Debtor, the administration of the 

Claimant Trust or the Litigation Sub-Trust, or the transactions in furtherance of the 

foregoing without the Bankruptcy Court (i) first determining, after notice and a hearing, 

that such claim or cause of action represents a colorable claim of any kind, including, but 

not limited to, negligence, bad faith, criminal misconduct, willful misconduct, fraud, or gross 

negligence against a Protected Party and (ii) specifically authorizing such Enjoined Party to 

bring such claim or cause of action against any such Protected Party; provided, however, the 

foregoing will not apply to a claim or cause of action against Strand or against any Employee 

other than with respect to actions taken, respectively, by Strand or by such Employee from 

the date of appointment of the Independent Directors through the Effective Date. The 

Bankruptcy Court will have sole and exclusive jurisdiction to determine whether a claim or 

cause of action is colorable and, only to the extent legally permissible and as provided for in 

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001192

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Article XI of the Plan, shall have jurisdiction to adjudicate the underlying colorable claim or 

cause of action. 

BB. Duration of Injunction and Stays. Unless otherwise provided in the 

Plan, in this Confirmation Order, or in a Final Order of the Bankruptcy Court, (i) all 

injunctions and stays entered during the Chapter 11 Case and in existence on the 

Confirmation Date, shall remain in full force and effect in accordance with their terms; and 

(ii) the automatic stay arising under section 362 of the Bankruptcy Code shall remain in full 

force and effect subject to Section 362(c) of the Bankruptcy Code, and to the extent necessary 

if the Debtor does not receive a discharge, the Bankruptcy Court will enter an equivalent 

order under Section 105.

CC. Continuance of January 9 Order and July 16 Order. Unless otherwise 

provided in the Plan, in this Confirmation Order, or in a Final Order of the Bankruptcy Court, each 

of the Order Approving Settlement with Official Committee of Unsecured Creditors Regarding 

Governance of the Debtor and Procedures for Operations in the Ordinary Course, entered by the 

Bankruptcy Court on January 9, 2020 [Docket No. 339] and Order Approving the Debtor’s Motion 

Under Bankruptcy Code Sections 105(a) and 363(b) Authorizing Retention of James P. Seery, Jr., 

as Chief Executive Officer, Chief Restructuring Officer, and Foreign Representative Nunc Pro 

Tunc to March 15, 2020 [Docket No. 854] entered on July 16, 2020 shall remain in full force and 

effect from the Confirmation Date and following the Effective Date. 

DD. No Governmental Releases. Nothing in this Confirmation Order or the 

Plan shall effect a release of any claim by the United States Government or any of its agencies or 

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001193

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any state and local authority whatsoever, including without limitation any claim arising under the 

Internal Revenue Code, the environmental laws or any criminal laws of the United States or any 

state and local authority against any party or person, nor shall anything in this Confirmation Order 

or the Plan enjoin the United States or any state or local authority from bringing any claim, suit, 

action, or other proceedings against any party or person for any liability of such persons whatever, 

including without limitation any claim, suit, or action arising under the Internal Revenue Code, 

the environmental laws or any criminal laws of the United States or any state and local authority 

against such persons, nor shall anything in this Confirmation Order or the Plan exculpate any party 

or person from any liability to the United States Government or any of its agencies or any state 

and local authority whatsoever, including any liabilities arising under the Internal Revenue Code, 

the environmental laws, or any criminal laws of the United States or any state and local authority 

against any party or person.

EE. Exemption from Transfer Taxes. Pursuant to section 1146(a) of the 

Bankruptcy Code, any transfers (whether from the Debtor to the Reorganized Debtor or to any 

other Person) of property under the Plan or pursuant to: (a) the issuance, distribution, transfer, or 

exchange of any debt, equity security, or other interest in the Debtor or the Reorganized Debtor; 

(b) the Restructuring transactions pursuant to the Plan; (c) the creation, modification, 

consolidation, termination, refinancing, and/or recording of any mortgage, deed of trust, or other 

security interest, or the securing of additional indebtedness by such or other means; (d) the making, 

assignment, or recording of any lease or sublease; or (e) the making, delivery, or recording of any 

deed or other instrument of transfer under, in furtherance of, or in connection with, the Plan, 

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001194

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including any deeds, bills of sale, assignments, or other instrument of transfer executed in 

connection with any transaction arising out of, contemplated by, or in any way related to the Plan, 

shall not be subject to any document recording tax, stamp tax, conveyance fee, intangibles or 

similar tax, mortgage tax, real estate transfer tax, mortgage recording tax, Uniform Commercial 

Code filing or recording fee, regulatory filing or recording fee, or other similar tax or governmental 

assessment to the fullest extent contemplated by section 1146(a) of the Bankruptcy Code, and upon 

entry of this Confirmation Order, the appropriate state or local governmental officials or agents 

shall forego the collection of any such tax or governmental assessment and accept for filing and 

recordation of any of the foregoing instruments or other documents without the payment of any 

such tax, recordation fee, or governmental assessment. 

FF. Cancellation of Notes, Certificates and Instruments. Except for the 

purpose of evidencing a right to a distribution under the Plan and except as otherwise set forth in 

the Plan or as otherwise provided in this Confirmation Order, on the Effective Date, all agreements, 

instruments, Securities and other documents evidencing any prepetition Claim or Equity Interest 

and any rights of any Holder in respect thereof shall be deemed cancelled, discharged, and of no 

force or effect. The holders of or parties to such cancelled instruments, Securities, and other 

documentation will have no rights arising from or related to such instruments, Securities, or other 

documentation or the cancellation thereof, except the rights provided for pursuant to the Plan, and 

the obligations of the Debtor thereunder or in any way related thereto will be fully released, 

terminated, extinguished and discharged, in each case without further notice to or order of the 

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001195

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Bankruptcy Court, act or action under applicable law, regulation, order, or rule or any requirement 

of further action, vote or other approval or authorization by any Person. 

GG. Documents, Mortgages, and Instruments. Each federal, state, 

commonwealth, local, foreign, or other governmental agency is authorized to accept any and all 

documents, mortgages, and instruments necessary or appropriate to effectuate, implement, or 

consummate the Plan, including the Restructuring transactions contemplated under the Plan, and 

this Confirmation Order. 

HH. Post-Confirmation Modifications. Subject section 1127(b) of the 

Bankruptcy Code and the Plan, the Debtor and the Reorganized Debtor expressly reserve their 

rights to revoke or withdraw, or to alter, amend, or modify materially the Plan, one or more times 

after Confirmation and, to the extent necessary, may initiate proceedings in the Bankruptcy Court 

to so alter, amend, or modify the Plan, or remedy any defect or omission, or reconcile any 

inconsistencies in the Plan or this Confirmation Order, in such manner as may be necessary to 

carry out the purposes and intent of the Plan. Any such modification or supplement shall be 

considered a modification of the Plan and shall be made in accordance with Article XII.B of the 

Plan. 

II. Applicable Nonbankruptcy Law. The provisions of this Confirmation 

Order, the Plan and related documents, or any amendments or modifications thereto, shall apply 

and be enforceable notwithstanding any otherwise applicable nonbankruptcy law. 

JJ. Governmental Approvals Not Required. This Confirmation Order shall 

constitute all approvals and consents required, if any, by the laws, rules, or regulations of any state, 

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001196

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federal, or other governmental authority with respect to the dissemination, implementation, or 

consummation of the Plan and the Disclosure Statement, any certifications, documents, 

instruments or agreements, and any amendments or modifications thereto, and any other acts 

referred to in, or contemplated by, the Plan and the Disclosure Statement. 

KK. Notice of Effective Date. As soon as reasonably practicable after the 

Effective Date, the Reorganized Debtor shall file notice of the Effective Date and shall serve a 

copy of the same on all Holders of Claims and Equity Interests, and all parties who have filed with 

the Bankruptcy Court requests to receive notices in accordance with Bankruptcy Rules 2002 and 

3020(c). Notwithstanding the above, no notice of Confirmation or Consummation or service of 

any kind shall be required to be mailed or made upon any Entity to whom the Debtor mailed notice 

of the Confirmation Hearing, but received such notice returned marked “undeliverable as 

addressed,” “moved, left no forwarding address” or “forwarding order expired,” or similar reason, 

unless the Debtor has been informed in writing by such Entity, or is otherwise aware, of that 

Entity’s new address. The above-referenced notices are adequate under the particular 

circumstances of this Chapter 11 Case and no other or further notice is necessary. 

LL. Substantial Consummation. On the Effective Date, the Plan shall be 

deemed to be substantially consummated under sections 1101 and 1127 of the Bankruptcy Code. 

MM. Waiver of Stay. For good cause shown, the stay of this Confirmation Order 

provided by any Bankruptcy Rule is waived, and this Confirmation Order shall be effective and 

enforceable immediately upon its entry by the Bankruptcy Court. 

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001197

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NN. References to and Omissions of Plan Provisions. References to articles, 

sections, and provisions of the Plan 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 failure to specifically include 

or to refer to any particular article, section, or provision of the Plan in this Confirmation Order 

shall not diminish or impair the effectiveness of such article, section, or provision, it being the 

intent of the Bankruptcy Court that the Plan be confirmed in its entirety, except as expressly 

modified herein, and incorporated herein by this reference. 

OO. Headings. Headings utilized herein are for convenience and reference only, 

and do not constitute a part of the Plan or this Confirmation Order for any other purpose. 

PP. Effect of Conflict. This Confirmation Order supersedes any Bankruptcy 

Court order issued prior to the Confirmation Date that may be inconsistent with this Confirmation 

Order. If there is any inconsistency between the terms of the Plan and the terms of this 

Confirmation Order, the terms of this Confirmation Order govern and control. If there is any 

inconsistency between the terms of this Confirmation Order and the terms of a final, executed Plan 

Supplement Document, the terms of the final, executed Plan Supplement Document will govern 

and control. 

QQ. Resolution of Objection of Texas Taxing Authorities. Dallas County, 

Kaufman County, City of Allen, Allen ISD and City of Richardson (collectively, the “Tax 

Authorities”) assert that they are the holders of prepetition and administrative expense claims for 

2019, 2020 and 2021 ad valorem real and business personal property taxes. The ad valorem 

property taxes for tax year 2020 shall be paid in accordance with and to the extent required under 

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001198

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DOCS_SF:104487.21 36027/002

applicable nonbankruptcy law. In the event the 2020 taxes are paid after February 1, 2021, the 

Tax Authorities may assert any rights and amounts they claim are owed with respect to penalties 

and interest that have accrued through the date of payment and the Debtor and Reorganized Debtor 

reserve any all rights and defenses in connection therewith. 

a. The Debtor/Reorganized Debtor shall pay all amounts owed to the Tax Authorities

for tax year 2021 in accordance with and to the extent required under applicable 

nonbankruptcy law. The Tax Authorities shall not be required to file and serve an 

administrative expense claim and request for payment as a condition of allowance 

of their administrative expense claims pursuant to 11 U.S.C. Section 503(b)(1)(D). 

With regard to year 2019 ad valorem property taxes, the Tax Authorities will 

receive payment of their prepetition claims within 30 days of the Effective Date of 

the Plan. The payment will include interest from the Petition Date through the 

Effective Date and from the Effective Date through payment in full at the state 

statutory rate pursuant to 11 U.S.C. Sections 506(b), 511, and 1129, if applicable, 

subject to all of the Debtor’s and Reorganized Debtor’s rights and defenses in 

connection therewith. Notwithstanding any other provision in the Plan, the Tax 

Authorities shall (i) retain the liens that secure all prepetition and postpetition 

amounts ultimately owed to them, if any, as well as (ii) the state law priority of 

those liens until the claims are paid in full. 

b. The Tax Authorities’ prepetition claims and their administrative expense claims 

shall not be discharged until such time as the amounts owed are paid in full. In the 

event of a default asserted by the Taxing Authorities, the Tax Authorities shall 

provide notice Debtor or Reorganized Debtor, as applicable, and may demand cure 

of any such asserted default. Subject to all of its rights and defenses, the Debtor or 

Reorganized Debtor shall have fifteen (15) days from the date of the notice to cure 

the default. If the alleged default is not cured, the Tax Authorities may exercise 

any of their respective rights under applicable law and pursue collection of all 

amounts owed pursuant to state law outside of the Bankruptcy Court, subject in all 

respects to the Debtor’s and Reorganized Debtor’s applicable rights and defenses. 

The Debtor/Reorganized Debtor shall be entitled to any notices of default required 

under applicable nonbankruptcy law and each of the Taxing Authorities, the Debtor 

and the Reorganized Debtor reserve any and all of their respective rights and 

defenses in connection therewith. The Debtor’s and Reorganized Debtor’s rights 

and defenses under Texas Law and the Bankruptcy Code with respect to this 

provision of the Confirmation Order, including their right to dispute or object to the 

Tax Authorities’ Claims and liens, are fully preserved. 

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001199

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RR. Resolution of Objections of Scott Ellington and Isaac Leventon. 

Pursuant to Bankruptcy Rule 9019(a), the Senior Employees’ Settlement is approved in all 

respects. The Debtor may, only with the consent of the Committee, elect Option B for a Senior 

Employee Claimant by written notice to such Senior Employee Claimant on or before the 

occurrence of the Effective Date. If the Debtor does not elect Option B, then Option A will govern 

the treatment of the Liquidated Bonus Claims. 

a. Notwithstanding any language in the Plan, the Disclosure Statement, or this 

Confirmation Order to the contrary, if Option A applies to the Liquidated Bonus 

Claims of a Senior Employee Claimant, then the Liquidated Bonus Claims of such 

Senior Employee Claimant will receive the treatment described in paragraph 82(e) 

hereof, and if the Debtor timely elects Option B with respect to the Liquidated 

Bonus Claims of a Senior Employee Claimant, then the Liquidated Bonus Claims 

of such Senior Employee will receive the treatment described in paragraph 82(f) 

hereof. 

b. The Senior Employees’ Settlement is hereby approved, without prejudice to the 

respective rights of Mr. Ellington and Mr. Leventon to assert all their remaining 

Claims against the Debtor’s estate, including, but not limited to, their Class 6 PTO 

Claims, their remaining Class 8 General Unsecured Claims, any indemnification 

claims, and any Administrative Expense Claims that they may assert and is without 

prejudice to the rights of any party in interest to object to any such Claims. 

c. Pursuant to Bankruptcy Rule 3018(a), Mr. Ellington and Mr. Leventon were 

permitted to change their votes on the Plan. Accordingly, Mr. Ellington’s votes on 

his Ballots in Class 7 and Class 8 of the Plan were changed from a rejection of the 

Plan to acceptance of the Plan, and Mr. Leventon’s votes on his Ballots in Class 7 

and Class 8 of the Plan were, changed from rejections of the Plan to acceptances of 

the Plan. 

d. The Senior Employees’ Objection is deemed withdrawn. 

SS. No Release of Claims Against Senior Employee Claimants. For the 

avoidance of doubt, the Senior Employees’ Settlement, as approved herein, shall not, and shall not 

be deemed to, release any Claims or Causes of Action held by the Debtor against either Senior 

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001200

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Employee Claimant nor shall either Senior Employee Claimant be, or be deemed to be, a “Released 

Party” under the Plan. 

TT. Resolution of Objection of Internal Revenue Service. Notwithstanding 

any other provision or term of the Plan or Confirmation Order, the following Default Provision 

shall control as to the United States of America, Internal Revenue Service (“IRS”) and all of its 

claims, including any administrative claim (the “IRS Claim”): 

(a) Notwithstanding any other provision in the Plan, if the Debtor, the Reorganized Debtor, 

or any successor in interest fails to pay when due any payment required to be made on 

federal taxes, the IRS Claim, or other payment required to be made to the IRS under the 

terms and provisions of this Plan, the Confirmation Order, or the Internal Revenue Code 

(26 U.S.C.), or fails to timely file any required federal tax return, or if any other event of 

default as set forth in the Plan occurs, the IRS shall be entitled to give the Debtor, the 

Reorganized Debtor and/or any successor in interest and their counsel of record, by United 

States Certified Mail, written notice of the failure and/or default with demand that it be 

cured, and if the failure and/or default is not cured within 14 days of the date of said notice 

and demand, then the following shall apply to the IRS: 

(1) The administrative collection powers and the rights of the IRS shall 

be reinstated as they existed prior to the filing of the bankruptcy petition, 

including, but not limited to, the assessment of taxes, the filing of a notice 

of Federal tax lien and the powers of levy, seizure, and collection as 

provided under the Internal Revenue Code; 

(2) The automatic stay of 11 U.S.C. § 362 and any injunction of the 

Plan or in the Confirmation Order shall, with regard to the IRS only, lift or 

terminate without further notice or hearing by the Bankruptcy Court, and 

the entire prepetition liability owed to the IRS, together with any unpaid 

postpetition tax liabilities, may become due and payable immediately; and 

(3) The IRS shall have the right to proceed to collect from the Debtor, 

the Reorganized Debtor or any successor in interest any of the prepetition 

tax liabilities and related penalties and interest through administrative or 

judicial collection procedures available under the United States Code as if 

no bankruptcy petition had been filed and as if no plan had been confirmed. 

(b) If the IRS declares the Debtor, the Reorganized Debtor, or any successor-in-interest to 

be in default of the Debtor’s, the Reorganized Debtor’s and/ or any successor- in-interest’s 

obligations under the Plan, then entire prepetition liability of an IRS’ Allowed Claim, 

together with any unpaid postpetition tax liabilities shall become due and payable 

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001201

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immediately upon written demand to the Debtor, Reorganized Debtor and/or any 

successor-in-interest. Failure of the IRS to declare a failure and/or default does not 

constitute a waiver by the United States or its agency the IRS of the right to declare that 

the Debtor, Reorganized Debtor, and/or any successor in interest is in default. 

(c) The IRS shall only be required to send two notices of failure and/or default, and upon 

the third event of a failure and/or default, the IRS shall be entitled to proceed as set out in 

paragraphs (1), (2), and/or (3) herein above without further notice to the Debtor, the 

Reorganized Debtor, or any successor in interest, or its counsel. The collection statute 

expiration date for all unpaid federal tax liabilities shall be extended pursuant to nonbankruptcy law. 

(d) The Internal Revenue Service shall not be bound by any release provisions in the Plan 

that would release any liability of the responsible persons of the Debtor, the Reorganized 

Debtor, and/or any successor in interest to the IRS. The Internal Revenue Service may 

take such actions as it deems necessary to assess any liability that may be due and owing 

by the responsible persons of the Debtor, the Reorganized Debtor and/or any successor in 

interest to the Internal Revenue Service. 

(e) Nothing contained in the Plan or the Confirmation Order shall be deemed to be a waiver 

or relinquishment of any rights, claims, causes of action, rights of setoff or recoupment, 

rights to appeal tax assessments, or other legal or equitable defenses that the Debtor or 

Reorganized Debtor have under non-bankruptcy law in connection with any claim, liability 

or cause of action of the United States and its agency the Internal Revenue Service. 

(f) The term “any payment required to be made on federal taxes,” as used herein above, is 

defined as: any payment or deposit required by the Internal Revenue Code to be made by 

the Debtor from and after the Confirmation Date, or the Reorganized Debtor and/or any 

successor in interest from and after the Effective Date, to the date the IRS Claim is together 

with interest paid in full. The term “any required tax return,” as used herein above, is 

defined as: any tax return or report required by the Internal Revenue Code to be made by 

the Debtor from and after the Confirmation Date, or the Reorganized Debtor and/or any 

successor in interest from and after the Effective Date, to the date the IRS Claim is together 

with interest paid in full. 

UU. IRS Proof of Claim. Notwithstanding anything in the Plan or in this 

Confirmation Order, until all required tax returns are filed with and processed by the IRS, the IRS’s 

proof of claim will not be deemed fixed for purposes of Section 502 of the Bankruptcy Code and 

may be amended in order to reflect the IRS’ assessment of the Debtor’s unpaid priority and general 

unsecured taxes, penalties and interest. 

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001202

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VV. CLO Holdco, Ltd. Settlement Notwithstanding anything contained 

herein to the contrary, nothing in this Order is or is intended to supersede the rights and obligations 

of either the Debtor or CLO Holdco contained in that certain Settlement Agreement between CLO 

Holdco, Ltd., and Highland Capital Management, L.P., dated January 25,2021 [Docket No. 1838-

1] (the “CLOH Settlement Agreement”). In the event of any conflict between the terms of this 

Order and the terms of the CLOH Settlement Agreement, the terms of the CLOH Settlement 

Agreement will govern. 

WW. Retention of Jurisdiction. The Bankruptcy Court may properly, and upon 

the Effective Date shall, to the maximum extent permitted under applicable law, retain jurisdiction 

over all matters arising out of, and related to, this Chapter 11 Case, including the matters set forth 

in Article XI of the Plan and section 1142 of the Bankruptcy Code. 

XX. Payment of Statutory Fees; Filing of Quarterly Reports. All fees 

payable pursuant to 28 U.S.C. § 1930 shall be paid on or before the Effective Date. The 

Reorganized Debtor, the Claimant Trust, and the Litigation Sub-Trust shall be jointly and severally 

liable for payment of quarterly fees to the Office of the United States Trustee pursuant to 28 U.S.C. 

§ 1930 through the entry of the Final Decree for the Debtor or the dismissal or conversion of the 

Chapter 11 Case. Notwithstanding anything to the contrary in the Plan, the U.S. Trustee shall not 

be required to file any proofs of claim with respect to quarterly fees payable pursuant to 28 U.S.C. 

§ 1930. 

YY. Dissolution of the Committee. On the Effective Date, the Committee will 

dissolve, and the members of the Committee and the Committee’s Professionals will cease to have 

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001203

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any role arising from or relating to the Chapter 11 Case, except in connection with final fee 

applications of Professionals for services rendered prior to the Effective Date (including the right 

to object thereto). Notwithstanding the foregoing, any Committee member or Professional may 

serve following the Effective Date with respect to the Claimant Trust Oversight Board or Litigation 

Sub-Trust. The Professionals retained by the Committee and the members thereof will not be 

entitled to assert any fee claims for any services rendered to the Committee or expenses incurred 

in the service of the Committee after the Effective Date, except for reasonable fees for services 

rendered, and actual and necessary costs incurred, in connection with any applications for 

allowance of Professional Fees pending on the Effective Date or filed and served after the Effective 

Date pursuant to the Plan. Nothing in the Plan shall prohibit or limit the ability of the Debtor’s or 

Committee’s Professionals to represent either of the Trustees or to be compensated or reimbursed 

per the Plan, the Claimant Trust Agreement, and/or Litigation Sub-Trust in connection with such 

representation. 

ZZ. Miscellaneous. After the Effective Date, the Debtor or Reorganized 

Debtor, as applicable, shall have no obligation to file with the Bankruptcy Court or serve on any 

parties reports that the Debtor or Reorganized Debtor, as applicable, were obligated to file under 

the Bankruptcy Code or a court order, including monthly operating reports (even for those periods 

for which a monthly operating report was not filed before the Effective Date), ordinary course 

professional reports, reports to any parties otherwise required under the “first” and “second” day 

orders entered in this Chapter 11 Case (including any cash collateral financing orders entered in 

this Chapter 11 Case) and monthly or quarterly reports for Professionals; provided, however, that 

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001204

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the Debtor or Reorganized Debtor, as applicable, will comply with the U.S. Trustee’s post 

confirmation reporting requirements. 

###END OF ORDER###

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001205

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Exhibit A 

Fifth Amended Plan (as Modified) 

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001206

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IN THE UNITED STATES BANKRUPTCY COURT 

FOR THE NORTHERN DISTRICT OF TEXAS 

DALLAS DIVISION 

In re: 

HIGHLAND CAPITAL MANAGEMENT, L.P.,1

Debtor. 

) 

) 

) 

) 

) 

) 

) 

Chapter 11 

Case No. 19-34054-sgj11 

FIFTH AMENDED PLAN OF REORGANIZATION OF HIGHLAND 

CAPITAL MANAGEMENT, L.P. (AS MODIFIED) 

PACHULSKI STANG ZIEHL & JONES LLP 

Jeffrey N. Pomerantz (CA Bar No.143717) 

Ira D. Kharasch (CA Bar No. 109084) 

Gregory V. Demo (NY Bar No. 5371992) 

10100 Santa Monica Boulevard, 13th Floor 

Los Angeles, CA 90067 

Telephone: (310) 277-6910 

Facsimile: (310) 201-0760 

Email: jpomerantz@pszjlaw.com 

 ikharasch@pszjlaw.com 

 gdemo@pszjlaw.com 

HAYWARD & ASSOCIATES PLLC 

Melissa S. Hayward (TX Bar No. 24044908) 

Zachery Z. Annable (TX Bar No. 24053075) 

10501 N. Central Expy, Ste. 106 

Dallas, TX 75231 

Telephone: (972) 755-7100 

Facsimile: (972) 755-7110 

Email: MHayward@HaywardFirm.com 

 ZAnnable@HaywardFirm.com: 

Counsel for the Debtor and Debtor-in-Possession 

1

 The Debtor’s last four digits of its taxpayer identification number are (6725). The headquarters and service address 

for the above-captioned Debtor is 300 Crescent Court, Suite 700, Dallas, TX 75201. 

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001207

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- i - 

ARTICLE I. RULES OF INTERPRETATION, COMPUTATION OF TIME, 

GOVERNING LAW AND DEFINED TERMS .............................................. 1

A. Rules of Interpretation, Computation of Time and Governing Law ..................... 1

B. Defined Terms ...................................................................................................... 2

ARTICLE II. ADMINISTRATIVE EXPENSES AND PRIORITY TAX CLAIMS................. 16

A. Administrative Expense Claims .......................................................................... 16

B. Professional Fee Claims ...................................................................................... 17

C. Priority Tax Claims ............................................................................................. 17

ARTICLE III. CLASSIFICATION AND TREATMENT OF CLASSIFIED CLAIMS 

AND EQUITY INTERESTS ......................................................................... 18

A. Summary ............................................................................................................. 18

B. Summary of Classification and Treatment of Classified Claims and 

Equity Interests ................................................................................................... 18

C. Elimination of Vacant Classes ............................................................................ 19

D. Impaired/Voting Classes ..................................................................................... 19

E. Unimpaired/Non-Voting Classes ........................................................................ 19

F. Impaired/Non-Voting Classes ............................................................................. 19

G. Cramdown ........................................................................................................... 19

H. Classification and Treatment of Claims and Equity Interests ............................. 19

I. Special Provision Governing Unimpaired Claims .............................................. 24

J. Subordinated Claims ........................................................................................... 24

ARTICLE IV. MEANS FOR IMPLEMENTATION OF THIS PLAN ..................................... 24

A. Summary ............................................................................................................. 24

B. The Claimant Trust ............................................................................................. 25

1. Creation and Governance of the Claimant Trust and Litigation 

Sub-Trust................................................................................................. 25 

2. Claimant Trust Oversight Committee ..................................................... 26 

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001208

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- ii - 

3. Purpose of the Claimant Trust. ............................................................... 27 

4. Purpose of the Litigation Sub-Trust. ....................................................... 27 

5. Claimant Trust Agreement and Litigation Sub-Trust Agreement. ......... 27 

6. Compensation and Duties of Trustees. ................................................... 29 

7. Cooperation of Debtor and Reorganized Debtor. ................................... 29 

8. United States Federal Income Tax Treatment of the Claimant 

Trust. ....................................................................................................... 29 

9. Tax Reporting. ........................................................................................ 30 

10. Claimant Trust Assets. ............................................................................ 30 

11. Claimant Trust Expenses. ....................................................................... 31 

12. Trust Distributions to Claimant Trust Beneficiaries. .............................. 31 

13. Cash Investments. ................................................................................... 31 

14. Dissolution of the Claimant Trust and Litigation Sub-Trust. ................. 31 

C. The Reorganized Debtor ..................................................................................... 32

1. Corporate Existence ................................................................................ 32 

2. Cancellation of Equity Interests and Release.......................................... 32 

3. Issuance of New Partnership Interests .................................................... 32 

4. Management of the Reorganized Debtor ................................................ 33 

5. Vesting of Assets in the Reorganized Debtor ......................................... 33 

6. Purpose of the Reorganized Debtor ........................................................ 33 

7. Distribution of Proceeds from the Reorganized Debtor Assets; 

Transfer of Reorganized Debtor Assets .................................................. 33 

D. Company Action ................................................................................................. 34

E. Release of Liens, Claims and Equity Interests.................................................... 35

F. Cancellation of Notes, Certificates and Instruments........................................... 35

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001209

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- iii - 

G. Cancellation of Existing Instruments Governing Security Interests ................... 35

H. Control Provisions .............................................................................................. 35

I. Treatment of Vacant Classes .............................................................................. 36

J. Plan Documents .................................................................................................. 36

K. Highland Capital Management, L.P. Retirement Plan and Trust ....................... 36

ARTICLE V. TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED 

LEASES ......................................................................................................... 37

A. Assumption, Assignment, or Rejection of Executory Contracts and 

Unexpired Leases ................................................................................................ 37

B. Claims Based on Rejection of Executory Contracts or Unexpired 

Leases .................................................................................................................. 38

C. Cure of Defaults for Assumed or Assigned Executory Contracts and 

Unexpired Leases ................................................................................................ 38

ARTICLE VI. PROVISIONS GOVERNING DISTRIBUTIONS ............................................. 39

A. Dates of Distributions ......................................................................................... 39

B. Distribution Agent .............................................................................................. 39

C. Cash Distributions ............................................................................................... 40

D. Disputed Claims Reserve .................................................................................... 40

E. Distributions from the Disputed Claims Reserve ............................................... 40

F. Rounding of Payments ........................................................................................ 40

G. De Minimis Distribution ..................................................................................... 41

H. Distributions on Account of Allowed Claims ..................................................... 41

I. General Distribution Procedures ......................................................................... 41

J. Address for Delivery of Distributions................................................................. 41

K. Undeliverable Distributions and Unclaimed Property ........................................ 41

L. Withholding Taxes .............................................................................................. 42

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001210

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- iv - 

M. Setoffs ................................................................................................................. 42

N. Surrender of Cancelled Instruments or Securities .............................................. 42

O. Lost, Stolen, Mutilated or Destroyed Securities ................................................. 43

ARTICLE VII. PROCEDURES FOR RESOLVING CONTINGENT, 

UNLIQUIDATED AND DISPUTED CLAIMS ............................................ 43

A. Filing of Proofs of Claim .................................................................................... 43

B. Disputed Claims .................................................................................................. 43

C. Procedures Regarding Disputed Claims or Disputed Equity Interests ............... 43

D. Allowance of Claims and Equity Interests .......................................................... 44

1. Allowance of Claims............................................................................... 44 

2. Estimation ............................................................................................... 44 

3. Disallowance of Claims .......................................................................... 44 

ARTICLE VIII. EFFECTIVENESS OF THIS PLAN ............................................................... 45

A. Conditions Precedent to the Effective Date ........................................................ 45

B. Waiver of Conditions .......................................................................................... 46

C. Dissolution of the Committee ............................................................................. 46

ARTICLE IX. EXCULPATION, INJUNCTION AND RELATED PROVISIONS ................. 47

A. General ................................................................................................................ 47

B. Discharge of Claims ............................................................................................ 47

C. Exculpation ......................................................................................................... 47

D. Releases by the Debtor........................................................................................ 48

E. Preservation of Rights of Action......................................................................... 49

1. Maintenance of Causes of Action ........................................................... 49 

2. Preservation of All Causes of Action Not Expressly Settled or 

Released .................................................................................................. 49 

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001211

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- v - 

F. Injunction ............................................................................................................ 50

G. Duration of Injunctions and Stays....................................................................... 51

H. Continuance of January 9 Order ......................................................................... 51

ARTICLE X. BINDING NATURE OF PLAN .......................................................................... 51

ARTICLE XI. RETENTION OF JURISDICTION .................................................................... 52

ARTICLE XII. MISCELLANEOUS PROVISIONS ................................................................. 54

A. Payment of Statutory Fees and Filing of Reports ............................................... 54

B. Modification of Plan ........................................................................................... 54

C. Revocation of Plan .............................................................................................. 54

D. Obligations Not Changed .................................................................................... 55

E. Entire Agreement ................................................................................................ 55

F. Closing of Chapter 11 Case ................................................................................ 55

G. Successors and Assigns....................................................................................... 55

H. Reservation of Rights .......................................................................................... 55

I. Further Assurances.............................................................................................. 56

J. Severability ......................................................................................................... 56

K. Service of Documents ......................................................................................... 56

L. Exemption from Certain Transfer Taxes Pursuant to Section 1146(a) of 

the Bankruptcy Code........................................................................................... 57

M. Governing Law ................................................................................................... 58

N. Tax Reporting and Compliance .......................................................................... 58

O. Exhibits and Schedules ....................................................................................... 58

P. Controlling Document ........................................................................................ 58

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001212

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DEBTOR’S CHAPTER 11 PLAN OF REORGANIZATION 

HIGHLAND CAPITAL MANAGEMENT, L.P., as debtor and debtor-in-possession in the 

above-captioned case (the “Debtor”), proposes the following chapter 11 plan of reorganization (the 

“Plan”) for, among other things, the resolution of the outstanding Claims against, and Equity 

Interests in, the Debtor. Unless otherwise noted, capitalized terms used in this Plan have the 

meanings set forth in Article I of this Plan. The Debtor is the proponent of this Plan within the 

meaning of section 1129 of the Bankruptcy Code. 

Reference is made to the Disclosure Statement (as such term is defined herein and 

distributed contemporaneously herewith) for a discussion of the Debtor’s history, business, results 

of operations, historical financial information, projections and assets, and for a summary and 

analysis of this Plan and the treatment provided for herein. There also are other agreements and 

documents that may be Filed with the Bankruptcy Court that are referenced in this Plan or the 

Disclosure Statement as Exhibits and Plan Documents. All such Exhibits and Plan Documents are 

incorporated into and are a part of this Plan as if set forth in full herein. Subject to the other 

provisions of this Plan, and in accordance with the requirements set forth in section 1127 of the 

Bankruptcy Code and Bankruptcy Rule 3019, the Debtor reserves the right to alter, amend, modify, 

revoke, or withdraw this Plan prior to the Effective Date. 

If this Plan cannot be confirmed, for any reason, then subject to the terms set forth herein, 

this Plan may be revoked. 

ARTICLE I.

RULES OF INTERPRETATION, COMPUTATION OF TIME, 

GOVERNING LAW AND DEFINED TERMS 

A. Rules of Interpretation, Computation of Time and Governing Law 

For purposes hereof: (a) in the appropriate context, each term, whether stated in the 

singular or the plural, shall include both the singular and the plural, and pronouns stated in the 

masculine, feminine or neuter gender shall include the masculine, feminine and the neuter gender; 

(b) any reference herein to a contract, lease, instrument, release, indenture or other agreement or 

document being in a particular form or on particular terms and conditions means that the referenced 

document, as previously amended, modified or supplemented, if applicable, shall be substantially 

in that form or substantially on those terms and conditions; (c) any reference herein to an existing 

document or exhibit having been Filed or to be Filed shall mean that document or exhibit, as it 

may thereafter be amended, modified or supplemented in accordance with its terms; (d) unless 

otherwise specified, all references herein to “Articles,” “Sections,” “Exhibits” and “Plan 

Documents” are references to Articles, Sections, Exhibits and Plan Documents hereof or hereto; 

(e) unless otherwise stated, the words “herein,” “hereof,” “hereunder” and “hereto” refer to this 

Plan in its entirety rather than to a particular portion of this Plan; (f) 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 hereof; (g) any reference to an Entity as a Holder of a Claim 

or Equity Interest includes such Entity’s successors and assigns; (h) the rules of construction set 

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001213

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2 

forth in section 102 of the Bankruptcy Code shall apply; (i) any term used in capitalized form 

herein that is not otherwise defined but that is used in the Bankruptcy Code or the Bankruptcy 

Rules shall have the meaning assigned to that term in the Bankruptcy Code or the Bankruptcy 

Rules, as the case may be; and (j) “$” or “dollars” means Dollars in lawful currency of the United 

States of America. The provisions of Bankruptcy Rule 9006(a) shall apply in computing any 

period of time prescribed or allowed herein. 

B. Defined Terms 

Unless the context otherwise requires, the following terms shall have the following 

meanings when used in capitalized form herein: 

1. “Acis” means collectively Acis Capital Management, L.P. and Acis Capital 

Management GP, LLP. 

2. “Administrative Expense Claim” means any Claim for costs and expenses 

of administration of the Chapter 11 Case that is Allowed pursuant to sections 503(b), 507(a)(2), 

507(b) or 1114(2) of the Bankruptcy Code, including, without limitation, (a) the actual and 

necessary costs and expenses incurred after the Petition Date and through the Effective Date of 

preserving the Estate and operating the business of the Debtor; and (b) all fees and charges assessed 

against the Estate pursuant to sections 1911 through 1930 of chapter 123 of title 28 of the United 

States Code, and that have not already been paid by the Debtor during the Chapter 11 Case and a 

Professional Fee Claim. 

3. “Administrative Expense Claims Bar Date” means, with respect to any 

Administrative Expense Claim (other than a Professional Fee Claim) becoming due on or prior to 

the Effective Date, 5:00 p.m. (prevailing Central Time) on such date that is forty-five days after 

the Effective Date. 

4. “Administrative Expense Claims Objection Deadline” means, with respect 

to any Administrative Expense Claim, the later of (a) ninety (90) days after the Effective Date and 

(b) sixty (60) days after the timely Filing of the applicable request for payment of such 

Administrative Expense Claim; provided, however, that the Administrative Expense Claims 

Objection Deadline may be extended by the Bankruptcy Court upon a motion by the Claimant 

Trustee. 

5. “Affiliate” of any Person means any Entity that, with respect to such Person, 

either (i) is an “affiliate” as defined in section 101(2) of the Bankruptcy Code, or (ii) is an 

“affiliate” as defined in Rule 405 of the Securities Act of 1933, or (iii) directly or indirectly, 

through one or more intermediaries, controls, is controlled by, or is under common control with, 

such Person. For the purposes of this definition, the term “control” (including, without limitation, 

the terms “controlled by” and “under common control with”) means the possession, directly or 

indirectly, of the power to direct or cause the direction in any respect of the management or policies 

of a Person, whether through the ownership of voting securities, by contract, or otherwise. 

6. “Allowed” means, with respect to any Claim, except as otherwise provided 

in the Plan: (a) any Claim that is evidenced by a Proof of Claim that has been timely Filed by the 

Bar Date, or that is not required to be evidenced by a Filed Proof of Claim under the Bankruptcy 

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001214

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3 

Code or a Final Order; (b) a Claim that is listed in the Schedules as not contingent, not unliquidated, 

and not disputed and for which no Proof of Claim has been timely filed; (c) a Claim Allowed 

pursuant to the Plan or an order of the Bankruptcy Court that is not stayed pending appeal; or (d) 

a Claim that is not Disputed (including for which a Proof of Claim has been timely filed in a 

liquidated and noncontingent amount that has not been objected to by the Claims Objection 

Deadline or as to which any such objection has been overruled by Final Order); provided, however,

that with respect to a Claim described in clauses (a) and (b) above, such Claim shall be considered 

Allowed only if and to the extent that, with respect to such Claim, no objection to the allowance 

thereof has been interposed within the applicable period of time fixed by the Plan, the Bankruptcy 

Code, the Bankruptcy Rules, or the Bankruptcy Court, or such an objection is so interposed and 

the Claim shall have been Allowed as set forth above. 

7. “Allowed Claim or Equity Interest” means a Claim or an Equity Interest of 

the type that has been Allowed. 

8. “Assets” means all of the rights, titles, and interest of the Debtor, 

Reorganized Debtor, or Claimant Trust, in and to property of whatever type or nature, including, 

without limitation, real, personal, mixed, intellectual, tangible, and intangible property, the 

Debtor’s books and records, and the Causes of Action. 

9. “Available Cash” means any Cash in excess of the amount needed for the 

Claimant Trust and Reorganized Debtor to maintain business operations as determined in the sole 

discretion of the Claimant Trustee. 

10. “Avoidance Actions” means any and all avoidance, recovery, subordination 

or other actions or remedies that may be brought by and on behalf of the Debtor or its Estate under 

the Bankruptcy Code or applicable nonbankruptcy law, including, without limitation, actions or 

remedies arising under sections 502, 510, 544, 545, and 547-553 of the Bankruptcy Code or under 

similar state or federal statutes and common law, including fraudulent transfer laws 

11. “Ballot” means the form(s) distributed to holders of Impaired Claims or 

Equity Interests entitled to vote on the Plan on which to indicate their acceptance or rejection of 

the Plan. 

12. “Bankruptcy Code” means title 11 of the United States Code, 11 U.S.C. 

§§ 101-1532, as amended from time to time and as applicable to the Chapter 11 Case. 

13. “Bankruptcy Court” means the United States Bankruptcy Court for the 

Northern District of Texas, Dallas Division, or any other court having jurisdiction over the 

Chapter 11 Case. 

14. “Bankruptcy Rules” means the Federal Rules of Bankruptcy Procedure and 

the Local Rules of Bankruptcy Practice and Procedure of the United States Bankruptcy Court for 

the Northern District of Texas, Dallas Division, in each case as amended from time to time and as 

applicable to the Chapter 11 Case. 

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001215

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4 

15. “Bar Date” means the applicable deadlines set by the Bankruptcy Court for 

the filing of Proofs of Claim against the Debtor as set forth in the Bar Date Order, which deadlines 

may be or have been extended for certain Claimants by order of the Bankruptcy Court. 

16. “Bar Date Order” means the Order (I) Establishing Bar Dates for Filing 

Proofs of Claim and (II) Approving the Form and Manner of Notice Thereof [D.I. 488]. 

17. “Business Day” means any day, other than a Saturday, Sunday or “legal 

holiday” (as defined in Bankruptcy Rule 9006(a)). 

18. “Cash” means the legal tender of the United States of America or the 

equivalent thereof. 

19. “Causes of Action” means any action, claim, cross-claim, third-party claim, 

cause of action, controversy, demand, right, Lien, indemnity, contribution, guaranty, suit, 

obligation, liability, debt, damage, judgment, account, defense, remedy, offset, power, privilege, 

license and franchise of any kind or character whatsoever, in each case whether known, unknown, 

contingent or non-contingent, matured or unmatured, suspected or unsuspected, liquidated or 

unliquidated, disputed or undisputed, foreseen or unforeseen, direct or indirect, choate or inchoate, 

secured or unsecured, assertable directly or derivatively (including, without limitation, under alter 

ego theories), whether arising before, on, or after the Petition Date, in contract or in tort, in law or 

in equity or pursuant to any other theory of law. For the avoidance of doubt, Cause of Action 

includes, without limitation,: (a) any right of setoff, counterclaim or recoupment and any claim for 

breach of contract or for breach of duties imposed by law or in equity; (b) the right to object to 

Claims or Equity Interests; (c) any claim pursuant to section 362 or chapter 5 of the Bankruptcy 

Code; (d) any claim or defense including fraud, mistake, duress and usury, and any other defenses 

set forth in section 558 of the Bankruptcy Code; (e) any claims under any state or foreign law, 

including, without limitation, any fraudulent transfer or similar claims; (f) the Avoidance Actions, 

and (g) the Estate Claims. The Causes of Action include, without limitation, the Causes of Action 

belonging to the Debtor’s Estate listed on the schedule of Causes of Action to be filed with the 

Plan Supplement. 

20. “CEO/CRO” means James P. Seery, Jr., the Debtor’s chief executive officer 

and chief restructuring officer. 

21. “Chapter 11 Case” means the Debtor’s case under chapter 11 of the 

Bankruptcy Code commenced on the Petition Date in the Delaware Bankruptcy Court and 

transferred to the Bankruptcy Court on December 4, 2019, and styled In re Highland Capital 

Management, L.P., Case No. 19-34054-sgj-11. 

22. “Claim” means any “claim” against the Debtor as defined in section 101(5) 

of the Bankruptcy Code. 

23. “Claims Objection Deadline” means the date that is 180 days after the 

Confirmation Date; provided, however, the Claims Objection Deadline may be extended by the 

Bankruptcy Court upon a motion by the Claimant Trustee. 

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001216

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24. “Claimant Trust” means the trust established for the benefit of the Claimant 

Trust Beneficiaries on the Effective Date in accordance with the terms of this Plan and the 

Claimant Trust Agreement. 

25. “Claimant Trust Agreement” means the agreement Filed in the Plan 

Supplement establishing and delineating the terms and conditions of the Claimant Trust. 

26. “Claimant Trust Assets” means (i) other than the Reorganized Debtor 

Assets (which are expressly excluded from this definition), all other Assets of the Estate, including, 

but not limited to, all Causes of Action, Available Cash, any proceeds realized or received from 

such Assets, all rights of setoff, recoupment, and other defenses with respect, relating to, or arising 

from such Assets, (ii) any Assets transferred by the Reorganized Debtor to the Claimant Trust on 

or after the Effective Date, (iii) the limited partnership interests in the Reorganized Debtor, and 

(iv) the ownership interests in New GP LLC. For the avoidance of doubt, any Causes of Action 

that, for any reason, are not capable of being transferred to the Claimant Trust shall constitute 

Reorganized Debtor Assets. 

27. “Claimant Trust Beneficiaries” means the Holders of Allowed General 

Unsecured Claims, Holders of Allowed Subordinated Claims, including, upon Allowance, 

Disputed General Unsecured Claims and Disputed Subordinated Claims that become Allowed 

following the Effective Date, and, only upon certification by the Claimant Trustee that the Holders 

of such Claims have been paid indefeasibly in full plus, to the extent all Allowed unsecured Claims, 

excluding Subordinated Claims, have been paid in full, post-petition interest from the Petition Date 

at the Federal Judgment Rate in accordance with the terms and conditions set forth in the Claimant 

Trust Agreement and all Disputed Claims in Class 8 and Class 9 have been resolved, Holders of 

Allowed Class B/C Limited Partnership Interests, and Holders of Allowed Class A Limited 

Partnership Interests. 

28. “Claimant Trustee” means James P. Seery, Jr., the Debtor’s chief executive 

officer and chief restructuring officer, or such other Person identified in the Plan Supplement who 

will act as the trustee of the Claimant Trust in accordance with the Plan, the Confirmation Order, 

and Claimant Trust Agreement or any replacement trustee pursuant to (and in accordance with) 

the Claimant Trust Agreement. The Claimant Trustee shall be responsible for, among other things, 

monetizing the Estate’s investment assets, resolving Claims (other than those Claims assigned to 

the Litigation Sub-Trust for resolution), and, as the sole officer of New GP LLC, winding down 

the Reorganized Debtor’s business operations. 

29. “Claimant Trust Expenses” means all reasonable legal and other reasonable 

professional fees, costs, and expenses incurred by the Trustees on account of administration of the 

Claimant Trust, including any reasonable administrative fees and expenses, reasonable attorneys’ 

fees and expenses, reasonable insurance costs, taxes, reasonable escrow expenses, and other 

expenses. 

30. “Claimant Trust Interests” means the non-transferable interests in the 

Claimant Trust that are issued to the Claimant Trust Beneficiaries pursuant to this Plan; provided, 

however, Holders of Class A Limited Partnership Interests, Class B Limited Partnership Interests, 

and Class C Limited Partnership Interests will not be deemed to hold Claimant Trust Interests 

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001217

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6 

unless and until the Contingent Claimant Trust Interests distributed to such Holders vest in 

accordance with the terms of this Plan and the Claimant Trust Agreement. 

31. “Claimant Trust Oversight Committee” means the committee of five 

Persons established pursuant to ARTICLE IV of this Plan to oversee the Claimant Trustee’s 

performance of its duties and otherwise serve the functions described in this Plan and the Claimant 

Trust Agreement. 

32. “Class” means a category of Holders of Claims or Equity Interests as set 

forth in ARTICLE III hereof pursuant to section 1122(a) of the Bankruptcy Code. 

33. “Class A Limited Partnership Interest” means the Class A Limited 

Partnership Interests as defined in the Limited Partnership Agreement held by The Dugaboy 

Investment Trust, Mark and Pamela Okada Family Trust – Exempt Trust 2, Mark and Pamela 

Okada – Exempt Descendants’ Trust, and Mark Kiyoshi Okada, and the General Partner Interest. 

34. “Class B Limited Partnership Interest” means the Class B Limited 

Partnership Interests as defined in the Limited Partnership Agreement held by Hunter Mountain 

Investment Trust. 

35. “Class B/C Limited Partnership Interests” means, collectively, the Class B 

Limited Partnership and Class C Limited Partnership Interests. 

36. “Class C Limited Partnership Interest” means the Class C Limited 

Partnership Interests as defined in the Limited Partnership Agreement held by Hunter Mountain 

Investment Trust. 

37. “Committee” means the Official Committee of Unsecured Creditors 

appointed by the U.S. Trustee pursuant to 11 U.S.C. § 1102(a)(1) on October 29, 2019 [D.I. 65], 

consisting of (i) the Redeemer Committee of Highland Crusader Fund, (ii) Meta-e Discovery, 

(iii) UBS, and (iv) Acis. 

38. “Confirmation Date” means the date on which the clerk of the Bankruptcy 

Court enters the Confirmation Order on the docket of the Bankruptcy Court. 

39. “Confirmation Hearing” means the hearing held by the Bankruptcy Court 

pursuant to section 1128 of the Bankruptcy Code to consider confirmation of this Plan, as such 

hearing may be adjourned or continued from time to time. 

40. “Confirmation Order” means the order of the Bankruptcy Court confirming 

this Plan pursuant to section 1129 of the Bankruptcy Code. 

41. “Convenience Claim” means any prepetition, liquidated, and unsecured 

Claim against the Debtor that as of the Confirmation Date is less than or equal to $1,000,000 or 

any General Unsecured Claim that makes the Convenience Class Election. For the avoidance of 

doubt, the Reduced Employee Claims will be Convenience Claims. 

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001218

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42. “Convenience Claim Pool” means the $13,150,000 in Cash that shall be 

available upon the Effective Date for distribution to Holders of Convenience Claims under the 

Plan as set forth herein. Any Cash remaining in the Convenience Claim Pool after all distributions 

on account of Convenience Claims have been made will be transferred to the Claimant Trust and 

administered as a Claimant Trust Asset. 

43. “Convenience Class Election” means the option provided to each Holder of 

a General Unsecured Claim that is a liquidated Claim as of the Confirmation Date on their Ballot 

to elect to reduce their claim to $1,000,000 and receive the treatment provided to Convenience 

Claims. 

44. “Contingent Claimant Trust Interests” means the contingent Claimant Trust 

Interests to be distributed to Holders of Class A Limited Partnership Interests, Holders of Class B 

Limited Partnership Interests, and Holders of Class C Limited Partnership Interests in accordance 

with this Plan, the rights of which shall not vest, and consequently convert to Claimant Trust 

Interests, unless and until the Claimant Trustee Files a certification that all holders of Allowed 

General Unsecured Claims have been paid indefeasibly in full, plus, to the extent all Allowed 

unsecured Claims, excluding Subordinated Claims, have been paid in full, all accrued and unpaid 

post-petition interest from the Petition Date at the Federal Judgment Rate and all Disputed Claims 

in Class 8 and Class 9 have been resolved. As set forth in the Claimant Trust Agreement, the 

Contingent Claimant Trust Interests distributed to the Holders of Class A Limited Partnership 

Interests will be subordinated to the Contingent Claimant Trust Interests distributed to the Holders 

of Class B/C Limited Partnership Interests. 

45. “Debtor” means Highland Capital Management, L.P. in its capacity as 

debtor and debtor in possession in the Chapter 11 Case. 

46. “Delaware Bankruptcy Court” means the United States Bankruptcy Court 

for the District of Delaware. 

47. “Disclosure Statement” means that certain Disclosure Statement for 

Debtor’s Fifth Amended Chapter 11 Plan of Reorganization, as amended, supplemented, or 

modified from time to time, which describes this Plan, including all exhibits and schedules thereto 

and references therein that relate to this Plan. 

48. “Disputed” means with respect to any Claim or Equity Interest, any Claim 

or Equity Interest that is not yet Allowed. 

49. “Disputed Claims Reserve” means the appropriate reserve(s) or account(s) 

to be established on the Initial Distribution Date and maintained by the Claimant Trustee for 

distributions on account of Disputed Claims that may subsequently become an Allowed Claim. 

50. “Disputed Claims Reserve Amount” means, for purposes of determining the 

Disputed Claims Reserve, the Cash that would have otherwise been distributed to a Holder of a 

Disputed Claim at the time any distributions of Cash are made to the Holders of Allowed Claims. 

The amount of the Disputed Claim upon which the Disputed Claims Reserve is calculated shall 

be: (a) the amount set forth on either the Schedules or the filed Proof of Claim, as applicable; (b) 

the amount agreed to by the Holder of the Disputed Claim and the Claimant Trustee or Reorganized 

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001219

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Debtor, as applicable; (c) the amount ordered by the Bankruptcy Court if it enters an order 

disallowing, in whole or in part, a Disputed Claim; or (d) as otherwise ordered by the Bankruptcy 

Court, including an order estimating the Disputed Claim. 

51. “Distribution Agent” means the Claimant Trustee, or any party designated 

by the Claimant Trustee to serve as distribution agent under this Plan. 

52. “Distribution Date” means the date or dates determined by the Reorganized 

Debtor or the Claimant Trustee, as applicable, on or after the Initial Distribution Date upon which 

the Distribution Agent shall make distributions to holders of Allowed Claims and Interests entitled 

to receive distributions under the Plan. 

53. “Distribution Record Date” means the date for determining which Holders 

of Claims and Equity Interests are eligible to receive distributions hereunder, which date shall be 

the Effective Date or such later date determined by the Bankruptcy Court. 

54. “Effective Date” means the Business Day that this Plan becomes effective 

as provided in ARTICLE VIII hereof. 

55. “Employees” means the employees of the Debtor set forth in the Plan 

Supplement. 

56. “Enjoined Parties” means (i) all Entities who have held, hold, or may hold 

Claims against or Equity Interests in the Debtor (whether or not proof of such Claims or Equity 

Interests has been filed and whether or not such Entities vote in favor of, against or abstain from 

voting on the Plan or are presumed to have accepted or deemed to have rejected the Plan), (ii) 

James Dondero (“Dondero”), (iii) any Entity that has appeared and/or filed any motion, objection, 

or other pleading in this Chapter 11 Case regardless of the capacity in which such Entity appeared 

and any other party in interest, (iv) any Related Entity, and (v) the Related Persons of each of the 

foregoing. 

57. “Entity” means any “entity” as defined in section 101(15) of the Bankruptcy 

Code and also includes any Person or any other entity. 

58. “Equity Interest” means any Equity Security in the Debtor, including, 

without limitation, all issued, unissued, authorized or outstanding partnership interests, shares, of 

stock or limited company interests, the Class A Limited Partnership Interests, the Class B Limited 

Partnership Interests, and the Class C Limited Partnership Interests. 

59. “Equity Security” means an “equity security” as defined in section 101(16) 

of the Bankruptcy Code. 

60. “Estate” means the bankruptcy estate of the Debtor created by virtue of 

section 541 of the Bankruptcy Code upon the commencement of the Chapter 11 Case. 

61. “Estate Claims” has the meaning given to it in Exhibit A to the Notice of 

Final Term Sheet [D.I. 354]. 

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001220

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62. “Exculpated Parties” means, collectively, (i) the Debtor and its successors 

and assigns, (ii) the Employees, (iii) Strand, (iv) the Independent Directors, (v) the Committee, 

(vi) the members of the Committee (in their official capacities), (vii) the Professionals retained by 

the Debtor and the Committee in the Chapter 11 Case, (viii) the CEO/CRO; and (ix) the Related 

Persons of each of the parties listed in (iv) through (viii); provided, however, that, for the avoidance 

of doubt, none of James Dondero, Mark Okada, NexPoint Advisors, L.P. (and any of its 

subsidiaries and managed entities), the Charitable Donor Advised Fund, L.P. (and any of its 

subsidiaries, including CLO Holdco, Ltd., and managed entities), Highland CLO Funding, Ltd. 

(and any of its subsidiaries, members, and managed entities), Highland Capital Management Fund 

Advisors, L.P. (and any of its subsidiaries and managed entities), NexBank, SSB (and any of its 

subsidiaries), the Hunter Mountain Investment Trust (or any trustee acting for the trust), the 

Dugaboy Investment Trust (or any trustee acting for the trust), or Grant Scott is included in the 

term “Exculpated Party.” 

63. “Executory Contract” means a contract to which the Debtor is a party that 

is subject to assumption or rejection under sections 365 or 1123 of the Bankruptcy Code. 

64. “Exhibit” means an exhibit annexed hereto or to the Disclosure Statement 

(as such exhibits are amended, modified or otherwise supplemented from time to time), which are 

incorporated by reference herein. 

65. “Federal Judgment Rate” means the post-judgment interest rate set forth in 

28 U.S.C. § 1961 as of the Effective Date. 

66. “File” or “Filed” or “Filing” means file, filed or filing with the Bankruptcy 

Court or its authorized designee in the Chapter 11 Case. 

67. “Final Order” means an order or judgment of the Bankruptcy Court, which 

is in full force and effect, and as to which the time to appeal, petition for certiorari, or move for a 

new trial, reargument or rehearing has expired and as to which no appeal, petition for certiorari, 

or other proceedings for a new trial, reargument or rehearing shall then be pending or as to which 

any right to appeal, petition for certiorari, new trial, reargument, or rehearing shall have been 

waived in writing in form and substance satisfactory to the Debtor, the Reorganized Debtor, or the 

Claimant Trustee, as applicable, or, in the event that an appeal, writ of certiorari, new trial, 

reargument, or rehearing thereof has been sought, such order of the Bankruptcy Court shall have 

been determined by the highest court to which such order was appealed, or certiorari, new trial, 

reargument or rehearing shall have been denied and the time to take any further appeal, petition 

for certiorari, or move for a new trial, reargument or rehearing shall have expired; provided, 

however, that the possibility that a motion under 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 preclude such order from being a Final Order. 

68. “Frontier Secured Claim” means the loan from Frontier State Bank to the 

Debtor in the principal amount of $7,879,688.00 made pursuant to that certain First Amended and 

Restated Loan Agreement, dated March 29, 2018. 

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001221

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69. “General Partner Interest” means the Class A Limited Partnership Interest 

held by Strand, as the Debtor’s general partner. 

70. “General Unsecured Claim” means any prepetition Claim against the 

Debtor that is not Secured and is not a/an: (a) Administrative Expense Claim; (b) Professional Fee 

Claim; (c) Priority Tax Claim; (d) Priority Non-Tax Claim; or (e) Convenience Claim. 

71. “Governmental Unit” means a “governmental unit” as defined in 

section 101(27) of the Bankruptcy Code. 

72. “GUC Election” means the option provided to each Holder of a 

Convenience Claim on their Ballot to elect to receive the treatment provided to General Unsecured 

Claims. 

73. “Holder” means an Entity holding a Claim against, or Equity Interest in, the 

Debtor. 

74. “Impaired” means, when used in reference to a Claim or Equity Interest, a 

Claim or Equity Interest that is impaired within the meaning of section 1124 of the Bankruptcy 

Code. 

75. “Independent Directors” means John S. Dubel, James P. Seery, Jr., and 

Russell Nelms, the independent directors of Strand appointed on January 9, 2020, and any 

additional or replacement directors of Strand appointed after January 9, 2020, but prior to the 

Effective Date. 

76. “Initial Distribution Date” means, subject to the “Treatment” sections in 

ARTICLE III hereof, the date that is on or as soon as reasonably practicable after the Effective 

Date, when distributions under this Plan shall commence to Holders of Allowed Claims and Equity 

Interests. 

77. “Insurance Policies” means all insurance policies maintained by the Debtor 

as of the Petition Date. 

78. “Jefferies Secured Claim” means any Claim in favor of Jefferies, LLC, 

arising under that certain Prime Brokerage Customer Agreement, dated May 24, 2013, between 

the Debtor and Jefferies, LLC, that is secured by the assets, if any, maintained in the prime 

brokerage account created by such Prime Brokerage Customer Agreement. 

79. “Lien” means a “lien” as defined in section 101(37) of the Bankruptcy Code 

and, with respect to any asset, includes, without limitation, any mortgage, lien, pledge, charge, 

security interest or other encumbrance of any kind, or any other type of preferential arrangement 

that has the practical effect of creating a security interest, in respect of such asset. 

80. “Limited Partnership Agreement” means that certain Fourth Amended and 

Restated Agreement of Limited Partnership of Highland Capital Management, L.P., dated 

December 24, 2015, as amended. 

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001222

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81. “Litigation Sub-Trust” means the sub-trust established within the Claimant 

Trust or as a wholly –owned subsidiary of the Claimant Trust on the Effective Date in each case 

in accordance with the terms and conditions set forth in the Litigation Sub-Trust Agreement and 

Claimant Trust Agreement. As set forth in the Litigation Sub-Trust Agreement, the Litigation 

Sub-Trust shall hold the Claimant Trust Assets that are Estate Claims. 

82. “Litigation Sub-Trust Agreement” means the agreement filed in the Plan 

Supplement establishing and delineating the terms and conditions of the Litigation Sub-Trust. 

83. “Litigation Trustee” means the trustee appointed by the Committee and 

reasonably acceptable to the Debtor who shall be responsible for investigating, litigating, and 

settling the Estate Claims for the benefit of the Claimant Trust in accordance with the terms and 

conditions set forth in the Litigation Sub-Trust Agreement. 

84. “Managed Funds” means Highland Multi-Strategy Credit Fund, L.P., 

Highland Restoration Capital Partners, L.P., and any other investment vehicle managed by the 

Debtor pursuant to an Executory Contract assumed pursuant to this Plan. 

85. “New Frontier Note” means that promissory note to be provided to the 

Allowed Holders of Class 2 Claims under this Plan and any other documents or security 

agreements securing the obligations thereunder. 

86. “New GP LLC” means a limited liability company incorporated in the State 

of Delaware pursuant to the New GP LLC Documents to serve as the general partner of the 

Reorganized Debtor on the Effective Date. 

87. “New GP LLC Documents” means the charter, operating agreement, and 

other formational documents of New GP LLC. 

88. “Ordinary Course Professionals Order” means that certain Order Pursuant 

to Sections 105(a), 327, 328, and 330 of the Bankruptcy Code Authorizing the Debtor to Retain, 

Employ, and Compensate Certain Professionals Utilized by the Debtor in the Ordinary Course 

[D.I. 176]. 

89. “Other Unsecured Claim” means any Secured Claim other than the 

Jefferies Secured Claim and the Frontier Secured Claim. 

90. “Person” means a “person” as defined in section 101(41) of the Bankruptcy 

Code and also includes any natural person, individual, corporation, company, general or limited 

partnership, limited liability company, unincorporated organization firm, trust, estate, business 

trust, association, joint stock company, joint venture, government, governmental agency, 

Governmental Unit or any subdivision thereof, the United States Trustee, or any other entity, 

whether acting in an individual, fiduciary or other capacity. 

91. “Petition Date” means October 16, 2019. 

92. “Plan” means this Debtor’s Fifth Amended Chapter 11 Plan of 

Reorganization, including the Exhibits and the Plan Documents and all supplements, appendices, 

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001223

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and schedules thereto, either in its present form or as the same may be altered, amended, modified 

or otherwise supplemented from time to time. 

93. “Plan Distribution” means the payment or distribution of consideration to 

Holders of Allowed Claims and Allowed Equity Interests under this Plan. 

94. “Plan Documents” means any of the documents, other than this Plan, but 

including, without limitation, the documents to be filed with the Plan Supplement, to be executed, 

delivered, assumed, or performed in connection with the occurrence of the Effective Date, and as 

may be modified consistent with the terms hereof with the consent of the Committee. 

95. “Plan Supplement” means the ancillary documents necessary for the 

implementation and effectuation of the Plan, including, without limitation, (i) the form of Claimant 

Trust Agreement, (ii) the forms of New GP LLC Documents, (iii) the form of Reorganized Limited 

Partnership Agreement, (iv) the Sub-Servicer Agreement (if applicable), (v) the identity of the 

initial members of the Claimant Trust Oversight Committee, (vi) the form of Litigation Sub-Trust 

Agreement; (vii) the schedule of retained Causes of Action; (viii) the New Frontier Note, (ix) the 

schedule of Employees; (x) the form of Senior Employee Stipulation,; and (xi) the schedule of 

Executory Contracts and Unexpired Leases to be assumed pursuant to this Plan, which, in each 

case, will be in form and substance reasonably acceptable to the Debtor and the Committee. 

96. “Priority Non-Tax Claim” means a Claim entitled to priority pursuant to 

section 507(a) of the Bankruptcy Code, including any Claims for paid time-off entitled to priority 

under section 507(a)(4) of the Bankruptcy Code, other than a Priority Tax Claim or an 

Administrative Claim. 

97. “Pro Rata” means the proportion that (a) the Allowed amount of a Claim or 

Equity Interest in a particular Class bears to (b) the aggregate Allowed amount of all Claims or 

Equity Interests in such Class. 

98. “Professional” means (a) any Entity employed in the Chapter 11 Case 

pursuant to section 327, 328 363 or 1103 of the Bankruptcy Code or otherwise and (b) any Entity 

seeking compensation or reimbursement of expenses in connection with the Chapter 11 Case 

pursuant to sections 327, 328, 330, 331, 363, 503(b), 503(b)(4) and 1103 of the Bankruptcy Code. 

99. “Professional Fee Claim” means a Claim under sections 328, 330(a), 331, 

363, 503 or 1103 of the Bankruptcy Code, with respect to a particular Professional, for 

compensation for services rendered or reimbursement of costs, expenses or other charges incurred 

after the Petition Date and prior to and including the Effective Date. 

100. “Professional Fee Claims Bar Date” means with respect to Professional Fee 

Claims, the Business Day which is sixty (60) days after the Effective Date or such other date as 

approved by order of the Bankruptcy Court. 

101. “Professional Fee Claims Objection Deadline” means, with respect to any 

Professional Fee Claim, thirty (30) days after the timely Filing of the applicable request for 

payment of such Professional Fee Claim. 

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102. “Professional Fee Reserve” means the reserve established and funded by 

the Claimant Trustee pursuant this Plan to provide sufficient funds to satisfy in full unpaid Allowed 

Professional Fee Claims. 

103. “Proof of Claim” means a written proof of Claim or Equity Interest Filed 

against the Debtor in the Chapter 11 Case. 

104. “Priority Tax Claim” means any Claim of a Governmental Unit of the kind 

specified in section 507(a)(8) of the Bankruptcy Code. 

105. “Protected Parties” means, collectively, (i) the Debtor and its successors 

and assigns, direct and indirect majority-owned subsidiaries, and the Managed Funds, (ii) the 

Employees, (iii) Strand, (iv) the Reorganized Debtor, (v) the Independent Directors, (vi) the 

Committee, (vii) the members of the Committee (in their official capacities), (viii) the Claimant 

Trust, (ix) the Claimant Trustee, (x) the Litigation Sub-Trust, (xi) the Litigation Trustee, (xii) the 

members of the Claimant Trust Oversight Committee (in their official capacities), (xiii) New GP 

LLC, (xiv) the Professionals retained by the Debtor and the Committee in the Chapter 11 Case, 

(xv) the CEO/CRO; and (xvi) the Related Persons of each of the parties listed in (iv) through (xv); 

provided, however, that, for the avoidance of doubt, none of James Dondero, Mark Okada, 

NexPoint Advisors, L.P. (and any of its subsidiaries and managed entities), the Charitable Donor 

Advised Fund, L.P. (and any of its subsidiaries, including CLO Holdco, Ltd., and managed 

entities), Highland CLO Funding, Ltd. (and any of its subsidiaries, members, and managed 

entities), NexBank, SSB (and any of its subsidiaries), Highland Capital Management Fund 

Advisors, L.P. (and any of its subsidiaries and managed entities), the Hunter Mountain Investment 

Trust (or any trustee acting for the trust), the Dugaboy Investment Trust (or any trustee acting for 

the trust), or Grant Scott is included in the term “Protected Party.” 

106. “PTO Claims” means any Claim for paid time off in favor of any Debtor 

employee in excess of the amount that would qualify as a Priority Non-Tax Claim under section 

507(a)(4) of the Bankruptcy Code. 

107. “Reduced Employee Claims” has the meaning set forth in ARTICLE IX.D. 

108. “Reinstated” means, with respect to any Claim or Equity Interest, (a) 

leaving unaltered the legal, equitable, and contractual rights to which a Claim entitles the Holder 

of such Claim or Equity Interest in accordance with section 1124 of the Bankruptcy Code or (b) 

notwithstanding any contractual provision or applicable law that entitles the Holder of such Claim 

or Equity Interest to demand or receive accelerated payment of such Claim or Equity Interest after 

the occurrence of a default: (i) curing any such default that occurred before or after the Petition 

Date, other than a default of a kind specified in section 365(b)(2) of the Bankruptcy Code or of a 

kind that section 365(b)(2) of the Bankruptcy Code expressly does not require to be cured; (ii) 

reinstating the maturity of such Claim or Equity Interest as such maturity existed before such 

default; (iii) compensating the Holder of such Claim or Equity Interest for any damages incurred 

as a result of any reasonable reliance by such Holder on such contractual provision or such 

applicable law; (iv) if such Claim or Equity Interest arises from any failure to perform a 

nonmonetary obligation, other than a default arising from failure to operate a non-residential real 

property lease subject to section 365(b)(1)(A) of the Bankruptcy Code, compensating the Holder 

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of such Claim or Equity Interest (other than any Debtor or an insider of any Debtor) for any actual 

pecuniary loss incurred by such Holder as a result of such failure; and (v) not otherwise altering 

the legal, equitable, or contractual rights to which such Claim entitles the Holder of such Claim. 

109. “Rejection Claim” means any Claim for monetary damages as a result of 

the rejection of an executory contract or unexpired lease pursuant to the Confirmation Order. 

110. “Related Entity” means, without duplication, (a) Dondero, (b) Mark Okada 

(“Okada”), (c) Grant Scott (“Scott”), (d) Hunter Covitz (“Covitz”), (e) any entity or person that 

was an insider of the Debtor on or before the Petition Date under Section 101(31) of the 

Bankruptcy Code, including, without limitation, any entity or person that was a non-statutory 

insider, (f) any entity that, after the Effective Date, is an insider or Affiliate of one or more of 

Dondero, Okada, Scott, Covitz, or any of their respective insiders or Affiliates, including, without 

limitation, The Dugaboy Investment Trust, (g) the Hunter Mountain Investment Trust and any of 

its direct or indirect parents, (h) the Charitable Donor Advised Fund, L.P., and any of its direct or 

indirect subsidiaries, and (i) Affiliates of the Debtor and any other Entities listed on the Related 

Entity List. 

111. “Related Entity List” means that list of Entities filed with the Plan 

Supplement. 

112. “Related Persons” means, with respect to any Person, such Person’s 

predecessors, successors, assigns (whether by operation of law or otherwise), and each of their 

respective present, future, or former officers, directors, employees, managers, managing members, 

members, financial advisors, attorneys, accountants, investment bankers, consultants, 

professionals, advisors, shareholders, principals, partners, subsidiaries, divisions, management 

companies, heirs, agents, and other representatives, in each case solely in their capacity as such. 

113. “Released Parties” means, collectively, (i) the Independent Directors; (ii) 

Strand (solely from the date of the appointment of the Independent Directors through the Effective 

Date); (iii) the CEO/CRO; (iv) the Committee; (v) the members of the Committee (in their official 

capacities), (vi) the Professionals retained by the Debtor and the Committee in the Chapter 11 

Case; and (vii) the Employees. 

114. “Reorganized Debtor” means the Debtor, as reorganized pursuant to this 

Plan on and after the Effective Date. 

115. “Reorganized Debtor Assets” means any limited and general partnership 

interests held by the Debtor, the management of the Managed Funds and those Causes of Action 

(including, without limitation, claims for breach of fiduciary duty), that, for any reason, are not 

capable of being transferred to the Claimant Trust. For the avoidance of doubt, “Reorganized 

Debtor Assets” includes any partnership interests or shares of Managed Funds held by the Debtor 

but does not include the underlying portfolio assets held by the Managed Funds. 

116. “Reorganized Limited Partnership Agreement” means that certain Fifth 

Amended and Restated Agreement of Limited Partnership of Highland Capital Management, L.P., 

by and among the Claimant Trust, as limited partner, and New GP LLC, as general partner, Filed 

with the Plan Supplement. 

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117. “Restructuring” means the restructuring of the Debtor, the principal terms 

of which are set forth in this Plan and the Disclosure Statement. 

118. “Retained Employee Claim” means any Claim filed by a current employee 

of the Debtor who will be employed by the Reorganized Debtor upon the Effective Date. 

119. “Schedules” means the schedules of Assets and liabilities, statements of 

financial affairs, lists of Holders of Claims and Equity Interests and all amendments or 

supplements thereto Filed by the Debtor with the Bankruptcy Court [D.I. 247]. 

120. “Secured” means, when referring to a Claim: (a) secured by a Lien on 

property in which the Debtor’s Estate has an interest, which Lien is valid, perfected, and 

enforceable pursuant to applicable law or by reason of a Bankruptcy Court order, or that is subject 

to setoff pursuant to section 553 of the Bankruptcy Code, to the extent of the value of the creditor’s 

interest in the interest of the Debtor’s Estate in such property or to the extent of the amount subject 

to setoff, as applicable, as determined pursuant to section 506(a) of the Bankruptcy Code or (b) 

Allowed pursuant to the Plan as a Secured Claim. 

121. “Security” or “security” means any security as such term is defined in 

section 101(49) of the Bankruptcy Code. 

122. “Senior Employees” means the senior employees of the Debtor Filed in the 

Plan Supplement. 

123. “Senior Employee Stipulation” means the agreements filed in the Plan 

Supplement between each Senior Employee and the Debtor. 

124. “Stamp or Similar Tax” means any stamp tax, recording tax, personal 

property tax, conveyance fee, intangibles or similar tax, real estate transfer tax, sales tax, use tax, 

transaction privilege tax (including, without limitation, such taxes on prime contracting and ownerbuilder sales), privilege taxes (including, without limitation, privilege taxes on construction 

contracting with regard to speculative builders and owner builders), and other similar taxes 

imposed or assessed by any Governmental Unit. 

125. “Statutory Fees” means fees payable pursuant to 28 U.S.C. § 1930. 

126. “Strand” means Strand Advisors, Inc., the Debtor’s general partner. 

127. “Sub-Servicer” means a third-party selected by the Claimant Trustee to 

service or sub-service the Reorganized Debtor Assets. 

128. “Sub-Servicer Agreement” means the agreement that may be entered into 

providing for the servicing of the Reorganized Debtor Assets by the Sub-Servicer. 

129. “Subordinated Claim” means any Claim that is subordinated to the 

Convenience Claims and General Unsecured Claims pursuant to an order entered by the 

Bankruptcy Court (including any other court having jurisdiction over the Chapter 11 Case) after 

notice and a hearing. 

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130. “Subordinated Claimant Trust Interests” means the Claimant Trust Interests 

to be distributed to Holders of Allowed Subordinated Claims under the Plan, which such interests 

shall be subordinated in right and priority to the Claimant Trust Interests distributed to Holders of 

Allowed General Unsecured Claims as provided in the Claimant Trust Agreement. 

131. “Trust Distribution” means the transfer of Cash or other property by the 

Claimant Trustee to the Claimant Trust Beneficiaries. 

132. “Trustees” means, collectively, the Claimant Trustee and Litigation 

Trustee. 

133. “UBS” means, collectively, UBS Securities LLC and UBS AG London 

Branch. 

134. “Unexpired Lease” means a lease to which the Debtor is a party that is 

subject to assumption or rejection under section 365 of the Bankruptcy Code. 

135. “Unimpaired” means, with respect to a Class of Claims or Equity Interests 

that is not impaired within the meaning of section 1124 of the Bankruptcy Code. 

136. “Voting Deadline” means the date and time by which all Ballots to accept 

or reject the Plan must be received in order to be counted under the under the Order of the 

Bankruptcy Court approving the Disclosure Statement as containing adequate information 

pursuant to section 1125(a) of the Bankruptcy Code and authorizing the Debtor to solicit 

acceptances of the Plan. 

137. “Voting Record Date” means November 23, 2020. 

ARTICLE II.

ADMINISTRATIVE EXPENSES AND PRIORITY TAX CLAIMS 

A. Administrative Expense Claims 

On the later of the Effective Date or the date on which an Administrative Expense Claim 

becomes an Allowed Administrative Expense Claim, or, in each such case, as soon as practicable 

thereafter, each Holder of an Allowed Administrative Expense Claim (other than Professional Fee 

Claims) will receive, in full satisfaction, settlement, discharge and release of, and in exchange for, 

such Allowed Administrative Expense Claim either (i) payment in full in Available Cash for the 

unpaid portion of such Allowed Administrative Expense Claim; or (ii) such other less favorable 

treatment as agreed to in writing by the Debtor or the Reorganized Debtor, as applicable, and such 

Holder; provided, however, that Administrative Expense Claims incurred by the Debtor in the 

ordinary course of business may be paid in the ordinary course of business in the discretion of the 

Debtor in accordance with such applicable terms and conditions relating thereto without further 

notice to or order of the Bankruptcy Court. All statutory fees payable under 28 U.S.C. § 1930(a) 

shall be paid as such fees become due. 

If an Administrative Expense Claim (other than a Professional Fee Claim) is not paid by 

the Debtor in the ordinary course, the Holder of such Administrative Expense Claim must File, on 

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or before the applicable Administrative Expense Claims Bar Date, and serve on the Debtor or 

Reorganized Debtor, as applicable, and such other Entities who are designated by the Bankruptcy 

Rules, the Confirmation Order or other order of the Bankruptcy Court, an application for allowance 

and payment of such Administrative Expense Claim. 

Objections to any Administrative Expense Claim (other than a Professional Fee Claim) 

must be Filed and served on the Debtor or the Reorganized Debtor, as applicable, and the party 

asserting such Administrative Expense Claim by the Administrative Expense Claims Objection 

Deadline. 

B. Professional Fee Claims 

Professionals or other Entities asserting a Professional Fee Claim for services rendered 

through the Effective Date must submit fee applications under sections 327, 328, 329,330, 331, 

503(b) or 1103 of the Bankruptcy Code and, upon entry of an order of the Bankruptcy Court 

granting such fee applications, such Professional Fee Claim shall promptly be paid in Cash in full 

to the extent provided in such order. 

Professionals or other Entities asserting a Professional Fee Claim for services rendered on 

or prior to the Effective Date must File, on or before the Professional Fee Claims Bar Date, and 

serve on the Debtor or Reorganized Debtor, as applicable, and such other Entities who are 

designated as requiring such notice by the Bankruptcy Rules, the Confirmation Order or other 

order of the Bankruptcy Court, an application for final allowance of such Professional Fee Claim. 

Objections to any Professional Fee Claim must be Filed and served on the Debtor or 

Reorganized Debtor, as applicable, and the party asserting the Professional Fee Claim by the 

Professional Fee Claim Objection Deadline. Each Holder of an Allowed Professional Fee Claim 

will be paid by the Debtor or the Claimant Trust, as applicable, in Cash within ten (10) Business 

Days of entry of the order approving such Allowed Professional Fee Claim. 

On the Effective Date, the Claimant Trustee shall establish the Professional Fee Reserve. 

The Professional Fee Reserve shall vest in the Claimant Trust and shall be maintained by the 

Claimant Trustee in accordance with the Plan and Claimant Trust Agreement. The Claimant Trust 

shall fund the Professional Fee Reserve on the Effective Date in an estimated amount determined 

by the Debtor in good faith prior to the Confirmation Date and that approximates the total projected 

amount of unpaid Professional Fee Claims on the Effective Date. Following the payment of all 

Allowed Professional Fee Claims, any excess funds in the Professional Fee Reserve shall be 

released to the Claimant Trust to be used for other purposes consistent with the Plan and the 

Claimant Trust Agreement. 

C. Priority Tax Claims 

On or as soon as reasonably practicable after the later of (i) the Initial Distribution Date if 

such Priority Tax Claim is an Allowed Priority Tax Claim as of the Effective Date or (ii) the date 

on which such Priority Tax Claim becomes an Allowed Priority Tax Claim, each Holder of an 

Allowed Priority Tax Claim will receive in full satisfaction, settlement, discharge and release of, 

and in exchange for, such Allowed Priority Tax Claim, at the election of the Debtor: (a) Cash in 

an amount of a total value as of the Effective Date of the Plan equal to the amount of such Allowed 

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Priority Tax Claim in accordance with section 1129(a)(9)(C) of the Bankruptcy Code, or (b) if 

paid over time, payment of such Allowed Priority Tax Claim in accordance with section 

1129(a)(9)(C) of the Bankruptcy Code; or (c) such other less favorable treatment as agreed to in 

writing by the Debtor and such Holder. Payment of statutory fees due pursuant to 28 U.S.C. § 

1930(a)(6) will be made at all appropriate times until the entry of a final decree; provided, however, 

that the Debtor may prepay any or all such Claims at any time, without premium or penalty. 

ARTICLE III.

CLASSIFICATION AND TREATMENT OF 

CLASSIFIED CLAIMS AND EQUITY INTERESTS 

A. Summary 

All Claims and Equity Interests, except Administrative Expense Claims and Priority Tax 

Claims, are classified in the Classes set forth below. In accordance with section 1123(a)(1) of the 

Bankruptcy Code, Administrative Expense Claims, and Priority Tax Claims have not been 

classified. 

The categories of Claims and Equity Interests listed below classify Claims and Equity 

Interests for all purposes including, without limitation, confirmation and distribution pursuant to 

the Plan and pursuant to sections 1122 and 1123(a)(1) of the Bankruptcy Code. The Plan deems 

a Claim or Equity Interest to be classified in a particular Class only to the extent that the Claim or 

Equity Interest qualifies within the description of that Class and will be 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. A Claim or Equity Interest is in a particular Class only to 

the extent that any such Claim or Equity Interest is Allowed in that Class and has not been paid, 

released or otherwise settled (in each case, by the Debtor or any other Entity) prior to the Effective 

Date. 

B. Summary of Classification and Treatment of Classified Claims and Equity Interests 

Class Claim Status Voting Rights 

1 Jefferies Secured Claim Unimpaired Deemed to Accept 

2 Frontier Secured Claim Impaired Entitled to Vote 

3 Other Secured Claims Unimpaired Deemed to Accept 

4 Priority Non-Tax Claim Unimpaired Deemed to Accept 

5 Retained Employee Claim Unimpaired Deemed to Accept 

6 PTO Claims Unimpaired Deemed to Accept 

7 Convenience Claims Impaired Entitled to Vote 

8 General Unsecured Claims Impaired Entitled to Vote 

9 Subordinated Claims Impaired Entitled to Vote 

10 Class B/C Limited Partnership Interests Impaired Entitled to Vote 

11 Class A Limited Partnership Interests Impaired Entitled to Vote 

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C. Elimination of Vacant Classes

Any Class that, as of the commencement of the Confirmation Hearing, does not have at 

least one Holder of a Claim or Equity Interest that is Allowed in an amount greater than zero for 

voting purposes shall be considered vacant, deemed eliminated from the Plan for purposes of 

voting to accept or reject the Plan, and disregarded for purposes of determining whether the Plan 

satisfies section 1129(a)(8) of the Bankruptcy Code with respect to such Class. 

D. Impaired/Voting Classes 

Claims and Equity Interests in Class 2 and Class 7 through Class 11 are Impaired by the 

Plan, and only the Holders of Claims or Equity Interests in those Classes are entitled to vote to 

accept or reject the Plan. 

E. Unimpaired/Non-Voting Classes 

Claims in Class 1 and Class 3 through Class 6 are Unimpaired by the Plan, and such 

Holders are deemed to have accepted the Plan and are therefore not entitled to vote on the Plan. 

F. Impaired/Non-Voting Classes 

There are no Classes under the Plan that will not receive or retain any property and no 

Classes are deemed to reject the Plan. 

G. Cramdown

If any Class of Claims or Equity Interests is deemed to reject this Plan or does not vote to 

accept this Plan, the Debtor may (i) seek confirmation of this Plan under section 1129(b) of the 

Bankruptcy Code or (ii) amend or modify this Plan in accordance with the terms hereof and the 

Bankruptcy Code. If a controversy arises as to whether any Claims or Equity Interests, or any 

class of Claims or Equity Interests, are Impaired, the Bankruptcy Court shall, after notice and a 

hearing, determine such controversy on or before the Confirmation Date. 

H. Classification and Treatment of Claims and Equity Interests 

1. Class 1 – Jefferies Secured Claim 

x Classification: Class 1 consists of the Jefferies Secured Claim. 

x Treatment: On or as soon as reasonably practicable after the Effective Date, 

each Holder of an Allowed Class 1 Claim will receive in full satisfaction, 

settlement, discharge and release of, and in exchange for, such Allowed 

Class 1 Claim, at the election of the Debtor: (A) Cash equal to the amount 

of such Allowed Class 1 Claim; (B) such other less favorable treatment as 

to which the Debtor and the Holder of such Allowed Class 1 Claim will 

have agreed upon in writing; or (C) such other treatment rendering such 

Claim Unimpaired. Each Holder of an Allowed Class 1 Claim will retain 

the Liens securing its Allowed Class 1 Claim as of the Effective Date until 

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full and final payment of such Allowed Class 1 Claim is made as provided 

herein. 

x Impairment and Voting: Class 1 is Unimpaired, and the Holders of Class 1 

Claims are conclusively deemed to have accepted this Plan pursuant to 

section 1126(f) of the Bankruptcy Code. Therefore, the Holders of Class 1 

Claims are not entitled to vote to accept or reject this Plan and will not be 

solicited. 

2. Class 2 – Frontier Secured Claim 

x Classification: Class 2 consists of the Frontier Secured Claim. 

x Treatment: On or as soon as reasonably practicable after the Effective Date, 

each Holder of an Allowed Class 2 Claim will receive in full satisfaction, 

settlement, discharge and release of, and in exchange for, such Allowed 

Class 2 Claim: (A) Cash in an amount equal to all accrued but unpaid 

interest on the Frontier Claim through and including the Effective Date and 

(B) the New Frontier Note. The Holder of an Allowed Class 2 Claim will 

retain the Liens securing its Allowed Class 2 Claim as of the Effective Date 

until full and final payment of such Allowed Class 2 Claim is made as 

provided herein. 

x Impairment and Voting: Class 2 is Impaired, and the Holders of Class 2 

Claims are entitled to vote to accept or reject this Plan. 

3. Class 3 – Other Secured Claims 

x Classification: Class 3 consists of the Other Secured Claims. 

x Allowance and Treatment: On or as soon as reasonably practicable after the 

later of (i) the Initial Distribution Date if such Class 3 Claim is Allowed on 

the Effective Date or (ii) the date on which such Class 3 Claim becomes an 

Allowed Class 3 Claim, each Holder of an Allowed Class 3 Claim will 

receive in full satisfaction, settlement, discharge and release of, and in 

exchange for, its Allowed Claim 3 Claim, at the option of the Debtor, or 

following the Effective Date, the Reorganized Debtor or Claimant Trustee, 

as applicable, (i) Cash equal to such Allowed Other Secured Claim, (ii) the 

collateral securing its Allowed Other Secured Claim, plus postpetition 

interest to the extent required under Bankruptcy Code Section 506(b), or 

(iii) such other treatment rendering such Claim Unimpaired. 

x Impairment and Voting: Class 3 is Unimpaired, and the Holders of Class 3 

Claims are conclusively deemed to have accepted this Plan pursuant to 

section 1126(f) of the Bankruptcy Code. Therefore, the Holders of Class 3 

Claims are not entitled to vote to accept or reject this Plan and will not be 

solicited. 

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4. Class 4 – Priority Non-Tax Claims 

x Classification: Class 4 consists of the Priority Non-Tax Claims. 

x Allowance and Treatment: On or as soon as reasonably practicable after the 

later of (i) the Initial Distribution Date if such Class 4 Claim is Allowed on 

the Effective Date or (ii) the date on which such Class 4 Claim becomes an 

Allowed Class 4 Claim, each Holder of an Allowed Class 4 Claim will 

receive in full satisfaction, settlement, discharge and release of, and in 

exchange for, its Allowed Claim 4 Claim Cash equal to the amount of such 

Allowed Class 4 Claim. 

x Impairment and Voting: Class 4 is Unimpaired, and the Holders of Class 4 

Claims are conclusively deemed to have accepted this Plan pursuant to 

section 1126(f) of the Bankruptcy Code. Therefore, the Holders of Class 4 

Claims are not entitled to vote to accept or reject this Plan and will not be 

solicited. 

5. Class 5 – Retained Employee Claims 

x Classification: Class 5 consists of the Retained Employee Claims. 

x Allowance and Treatment: On or as soon as reasonably practicable after the 

Effective Date, each Allowed Class 5 Claim will be Reinstated. 

x Impairment and Voting: Class 5 is Unimpaired, and the Holders of Class 5 

Claims are conclusively deemed to have accepted this Plan pursuant to 

section 1126(f) of the Bankruptcy Code. Therefore, the Holders of Class 5 

Claims are not entitled to vote to accept or reject this Plan and will not be 

solicited. 

6. Class 6 – PTO Claims 

x Classification: Class 6 consists of the PTO Claims. 

x Allowance and Treatment: On or as soon as reasonably practicable after the 

later of (i) the Initial Distribution Date if such Class 6 Claim is Allowed on 

the Effective Date or (ii) the date on which such Class 6 Claim becomes an 

Allowed Class 6 Claim, each Holder of an Allowed Class 6 Claim will 

receive in full satisfaction, settlement, discharge and release of, and in 

exchange for, its Allowed Claim 6 Claim Cash equal to the amount of such 

Allowed Class 6 Claim. 

x Impairment and Voting: Class 6 is Unimpaired, and the Holders of Class 6 

Claims are conclusively deemed to have accepted this Plan pursuant to 

section 1126(f) of the Bankruptcy Code. Therefore, the Holders of Class 6 

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Claims are not entitled to vote to accept or reject this Plan and will not be 

solicited. 

7. Class 7 – Convenience Claims 

x Classification: Class 7 consists of the Convenience Claims. 

x Allowance and Treatment: On or as soon as reasonably practicable after the 

later of (i) the Initial Distribution Date if such Class 7 Claim is Allowed on 

the Effective Date or (ii) the date on which such Class 7 Claim becomes an 

Allowed Class 7 Claim, each Holder of an Allowed Class 7 Claim will 

receive in full satisfaction, settlement, discharge and release of, and in 

exchange for, its Allowed Class 7 Claim (1) the treatment provided to 

Allowed Holders of Class 8 General Unsecured Claims if the Holder of such 

Class 7 Claim makes the GUC Election or (2) an amount in Cash equal to 

the lesser of (a) 85% of the Allowed amount of such Holder’s Class 7 Claim 

or (b) such Holder’s Pro Rata share of the Convenience Claims Cash Pool. 

x Impairment and Voting: Class 7 is Impaired, and the Holders of Class 7 

Claims are entitled to vote to accept or reject this Plan. 

8. Class 8 – General Unsecured Claims 

x Classification: Class 8 consists of the General Unsecured Claims. 

x Treatment: On or as soon as reasonably practicable after the Effective Date, 

each Holder of an Allowed Class 8 Claim, in full satisfaction, settlement, 

discharge and release of, and in exchange for, such Claim shall receive (i) 

its Pro Rata share of the Claimant Trust Interests, (ii) such other less 

favorable treatment as to which such Holder and the Claimant Trustee shall 

have agreed upon in writing, or (iii) the treatment provided to Allowed 

Holders of Class 7 Convenience Claims if the Holder of such Class 8 

General Unsecured Claim is eligible and makes a valid Convenience Class 

Election. 

Notwithstanding anything to the contrary herein, after the Effective Date 

and subject to the other provisions of this Plan, the Debtor, the Reorganized 

Debtor, and the Claimant Trust, as applicable, will have and will retain any 

and all rights and defenses under bankruptcy or nonbankruptcy law that the 

Debtor had with respect to any General Unsecured Claim, except with 

respect to any General Unsecured Claim Allowed by Final Order of the 

Bankruptcy Court. 

x Impairment and Voting: Class 8 is Impaired, and the Holders of Class 8 

Claims are entitled to vote to accept or reject this Plan. 

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001234

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9. Class 9 – Subordinated Claims 

x Classification: Class 9 consists of the Subordinated Claims. 

Treatment: On the Effective Date, Holders of Subordinated Claims shall 

receive either (i) their Pro Rata share of the Subordinated Claimant Trust 

Interests or, (ii) such other less favorable treatment as to which such Holder 

and the Claimant Trustee may agree upon in writing. 

Notwithstanding anything to the contrary herein, after the Effective Date 

and subject to the other provisions of this Plan, the Debtor, the Reorganized 

Debtor, and the Claimant Trust, as applicable, will have and will retain any 

and all rights and defenses under bankruptcy or nonbankruptcy law that the 

Debtor had with respect to any Subordinated Claim, except with respect to 

any Subordinated Claim Allowed by Final Order of the Bankruptcy Court. 

x Impairment and Voting: Class 9 is Impaired, and the Holders of Class 9 

Claims are entitled to vote to accept or reject this Plan. 

10. Class 10 – Class B/C Limited Partnership Interests 

x Classification: Class 10 consists of the Class B/C Limited Partnership 

Interests. 

x Treatment: On or as soon as reasonably practicable after the Effective Date, 

each Holder of an Allowed Class 10 Claim, in full satisfaction, settlement, 

discharge and release of, and in exchange for, such Claim shall receive (i) 

its Pro Rata share of the Contingent Claimant Trust Interests or (ii) such 

other less favorable treatment as to which such Holder and the Claimant 

Trustee shall have agreed upon in writing. 

Notwithstanding anything to the contrary herein, after the Effective Date 

and subject to the other provisions of this Plan, the Debtor, the Reorganized 

Debtor, and the Claimant Trust, as applicable, will have and will retain any 

and all rights and defenses under bankruptcy or nonbankruptcy law that the 

Debtor had with respect to any Class B/C Limited Partnership Interest 

Claim, except with respect to any Class B/C Limited Partnership Interest 

Claim Allowed by Final Order of the Bankruptcy Court. 

x Impairment and Voting: Class 10 is Impaired, and the Holders of Class 10 

Claims are entitled to vote to accept or reject this Plan. 

11. Class 11 – Class A Limited Partnership Interests 

x Classification: Class 11 consists of the Class A Limited Partnership 

Interests. 

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x Treatment: On or as soon as reasonably practicable after the Effective Date, 

each Holder of an Allowed Class 11 Claim, in full satisfaction, settlement, 

discharge and release of, and in exchange for, such Claim shall receive (i) 

its Pro Rata share of the Contingent Claimant Trust Interests or (ii) such 

other less favorable treatment as to which such Holder and the Claimant 

Trustee shall have agreed upon in writing. 

Notwithstanding anything to the contrary herein, after the Effective Date 

and subject to the other provisions of this Plan, the Debtor, the Reorganized 

Debtor, and the Claimant Trust, as applicable, will have and will retain any 

and all rights and defenses under bankruptcy or nonbankruptcy law that the 

Debtor had with respect to any Class A Limited Partnership Interest, except 

with respect to any Class A Limited Partnership Interest Allowed by Final 

Order of the Bankruptcy Court. 

x Impairment and Voting: Class 11 is Impaired, and the Holders of Class 11 

Claims are entitled to vote to accept or reject this Plan. 

I. Special Provision Governing Unimpaired Claims 

Except as otherwise provided in the Plan, nothing under the Plan will affect the Debtor’s 

rights in respect of any Unimpaired Claims, including, without limitation, all rights in respect of 

legal and equitable defenses to or setoffs or recoupments against any such Unimpaired Claims. 

J. Subordinated Claims 

The allowance, classification, and treatment of all Claims under the Plan shall take into 

account and conform to the contractual, legal, and equitable subordination rights relating thereto, 

whether arising under general principles of equitable subordination, section 510(b) of the 

Bankruptcy Code, or otherwise. Upon written notice and hearing, the Debtor the Reorganized 

Debtor, and the Claimant Trustee reserve the right to seek entry of an order by the Bankruptcy 

Court to re-classify or to subordinate any Claim in accordance with any contractual, legal, or 

equitable subordination relating thereto, and the treatment afforded any Claim under the Plan that 

becomes a subordinated Claim at any time shall be modified to reflect such subordination. 

ARTICLE IV.

MEANS FOR IMPLEMENTATION OF THIS PLAN 

A. Summary 

As discussed in the Disclosure Statement, the Plan will be implemented through (i) the 

Claimant Trust, (ii) the Litigation Sub-Trust, and (iii) the Reorganized Debtor. 

On the Effective Date, all Class A Limited Partnership Interests, including the Class A 

Limited Partnership Interests held by Strand, as general partner, and Class B/C Limited 

Partnerships in the Debtor will be cancelled, and new Class A Limited Partnership Interests in the 

Reorganized Debtor will be issued to the Claimant Trust and New GP LLC – a newly-chartered 

limited liability company wholly-owned by the Claimant Trust. The Claimant Trust, as limited 

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partner, will ratify New GP LLC’s appointment as general partner of the Reorganized Debtor, and 

on and following the Effective Date, the Claimant Trust will be the Reorganized Debtor’s limited 

partner and New GP LLC will be its general partner. The Claimant Trust, as limited partner, and 

New GP LLC, as general partner, will execute the Reorganized Limited Partnership Agreement, 

which will amend and restate, in all respects, the Debtor’s current Limited Partnership Agreement. 

Following the Effective Date, the Reorganized Debtor will be managed consistent with the terms 

of the Reorganized Limited Partnership Agreement by New GP LLC. The sole managing member 

of New GP LLC will be the Claimant Trust, and the Claimant Trustee will be the sole officer of 

New GP LLC on the Effective Date. 

Following the Effective Date, the Claimant Trust will administer the Claimant Trust Assets 

pursuant to this Plan and the Claimant Trust Agreement, and the Litigation Trustee will pursue, if 

applicable, the Estate Claims pursuant to the terms of the Litigation Sub-Trust Agreement and the 

Plan. The Reorganized Debtor will administer the Reorganized Debtor Assets and, if needed, with 

the utilization of a Sub-Servicer, which administration will include, among other things, managing 

the wind down of the Managed Funds. 

Although the Reorganized Debtor will manage the wind down of the Managed Funds, it is 

currently anticipated that neither the Reorganized Debtor nor the Claimant Trust will assume or 

assume and assign the contracts between the Debtor and certain Related Entities pursuant to which 

the Debtor provides shared services and sub-advisory services to those Related Entities. The 

Debtor believes that the continued provision of the services under such contracts will not be cost 

effective. 

The Reorganized Debtor will distribute all proceeds from the wind down to the Claimant 

Trust, as its limited partner, and New GP LLC, as its general partner, in each case in accordance 

with the Reorganized Limited Partnership Agreement. Such proceeds, along with the proceeds of 

the Claimant Trust Assets, will ultimately be distributed to the Claimant Trust Beneficiaries as set 

forth in this Plan and the Claimant Trust Agreement. 

B. The Claimant Trust2

 

1. Creation and Governance of the Claimant Trust and Litigation Sub-Trust. 

On or prior to the Effective Date, the Debtor and the Claimant Trustee shall execute the 

Claimant Trust Agreement and shall take all steps necessary to establish the Claimant Trust and 

the Litigation Sub-Trust in accordance with the Plan in each case for the benefit of the Claimant 

Trust Beneficiaries. Additionally, on or prior to the Effective Date, the Debtor shall irrevocably 

transfer and shall be deemed to have irrevocably transferred to the Claimant Trust all of its rights, 

title, and interest in and to all of the Claimant Trust Assets, and in accordance with section 1141 

of the Bankruptcy Code, the Claimant Trust Assets shall automatically vest in the Claimant Trust 

free and clear of all Claims, Liens, encumbrances, or interests subject only to the Claimant Trust 

Interests and the Claimant Trust Expenses, as provided for in the Claimant Trust Agreement, and 

2

 In the event of a conflict between the terms of this summary and the terms of the Claimant Trust Agreement and the 

Litigation Sub-Trust Agreement, the terms of the Claimant Trust Agreement or the Litigation Sub-Trust Agreement, 

as applicable, shall control. 

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such transfer shall be exempt from any stamp, real estate transfer, mortgage from any stamp, 

transfer, reporting, sales, use, or other similar tax. 

The Claimant Trustee shall be the exclusive trustee of the Claimant Trust Assets, excluding 

the Estate Claims and the Litigation Trustee shall be the exclusive trustee with respect to the Estate 

Claims in each case for purposes of 31 U.S.C. § 3713(b) and 26 U.S.C. § 6012(b)(3), as well as 

the representative of the Estate appointed pursuant to section 1123(b)(3)(B) of the Bankruptcy 

Code with respect to the Claimant Trust Assets. The Claimant Trustee shall also be responsible 

for resolving all Claims and Equity Interests in Class 8 through Class 11, under the supervision of 

the Claimant Trust Oversight Committee. 

On the Effective Date, the Claimant Trustee and Litigation Trustee shall execute the 

Litigation Sub-Trust Agreement and shall take all steps necessary to establish the Litigation SubTrust. Upon the creation of the Litigation Sub-Trust, the Claimant Trust shall irrevocably transfer 

and assign to the Litigation Sub-Trust the Estate Claims. The Claimant Trust shall be governed 

by the Claimant Trust Agreement and administered by the Claimant Trustee. The powers, rights, 

and responsibilities of the Claimant Trustee shall be specified in the Claimant Trust Agreement 

and shall include the authority and responsibility to, among other things, take the actions set forth 

in this ARTICLE IV, subject to any required reporting to the Claimant Trust Oversight Committee 

as may be set forth in the Claimant Trust Agreement. The Claimant Trust shall hold and distribute 

the Claimant Trust Assets (including the proceeds from the Estate Claims, if any) in accordance 

with the provisions of the Plan and the Claimant Trust Agreement; provided that the Claimant 

Trust Oversight Committee may direct the Claimant Trust to reserve Cash from distributions as 

necessary to fund the Claimant Trust and Litigation Sub-Trust. Other rights and duties of the 

Claimant Trustee and the Claimant Trust Beneficiaries shall be as set forth in the Claimant Trust 

Agreement. After the Effective Date, neither the Debtor nor the Reorganized Debtor shall have 

any interest in the Claimant Trust Assets. 

The Litigation Sub-Trust shall be governed by the Litigation Sub-Trust Agreement and 

administered by the Litigation Trustee. The powers, rights, and responsibilities of the Litigation 

Trustee shall be specified in the Litigation Sub-Trust Agreement and shall include the authority 

and responsibility to, among other things, take the actions set forth in this ARTICLE IV, subject 

to any required reporting as may be set forth in the Litigation Sub-Trust Agreement. The Litigation 

Sub-Trust shall investigate, prosecute, settle, or otherwise resolve the Estate Claims in accordance 

with the provisions of the Plan and the Litigation Sub-Trust Agreement and shall distribute the 

proceeds therefrom to the Claimant Trust for distribution. Other rights and duties of the Litigation 

Trustee shall be as set forth in the Litigation Sub-Trust Agreement. 

2. Claimant Trust Oversight Committee 

The Claimant Trust, the Claimant Trustee, the management and monetization of the 

Claimant Trust Assets, and the management of the Reorganized Debtor (through the Claimant 

Trust’s role as managing member of New GP LLC) and the Litigation Sub-Trust will be overseen 

by the Claimant Trust Oversight Committee, subject to the terms of the Claimant Trust Agreement 

and the Litigation Sub-Trust Agreement, as applicable. 

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The Claimant Trust Oversight Committee will initially consist of five members. Four of 

the five members will be representatives of the members of the Committee: (i) the Redeemer 

Committee of Highland Crusader Fund, (ii) UBS, (iii) Acis, and (iv) Meta-e Discovery. The fifth 

member will be an independent, natural Person chosen by the Committee and reasonably 

acceptable to the Debtor. The members of the Claimant Trust Oversight Committee may be 

replaced as set forth in the Claimant Trust Agreement. The identity of the members of the Claimant 

Trust Oversight Committee will be disclosed in the Plan Supplement. 

As set forth in the Claimant Trust Agreement, in no event will any member of the Claimant 

Trust Oversight Committee with a Claim against the Estate be entitled to vote, opine, or otherwise 

be involved in any matters related to such member’s Claim. 

The independent member(s) of the Claimant Trust Oversight Committee may be entitled 

to compensation for their services as set forth in the Claimant Trust Agreement. Any member of 

the Claimant Trust Oversight Committee may be removed, and successor chosen, in the manner 

set forth in the Claimant Trust Agreement. 

3. Purpose of the Claimant Trust. 

The Claimant Trust shall be established for the purpose of (i) managing and monetizing 

the Claimant Trust Assets, subject to the terms of the Claimant Trust Agreement and the oversight 

of the Claimant Trust Oversight Committee, (ii) serving as the limited partner of, and holding the 

limited partnership interests in, the Reorganized Debtor, (iii) serving as the sole member and 

manager of New GP LLC, the Reorganized Debtor’s general partner, (iv) in its capacity as the sole 

member and manager of New GP LLC, overseeing the management and monetization of the 

Reorganized Debtor Assets pursuant to the terms of the Reorganized Limited Partnership 

Agreement; and (v) administering the Disputed Claims Reserve and serving as Distribution Agent 

with respect to Disputed Claims in Class 7 or Class 8. 

In its management of the Claimant Trust Assets, the Claimant Trust will also reconcile and 

object to the General Unsecured Claims, Subordinated Claims, Class B/C Limited Partnership 

Interests, and Class A Limited Partnership Interests, as provided for in this Plan and the Claimant 

Trust Agreement, and make Trust Distributions to the Claimant Trust Beneficiaries in accordance 

with Treasury Regulation section 301.7701-4(d), with no objective to continue or engage in the 

conduct of a trade or business. 

The purpose of the Reorganized Debtor is discussed at greater length in ARTICLE IV.C. 

4. Purpose of the Litigation Sub-Trust. 

The Litigation Sub-Trust shall be established for the purpose of investigating, prosecuting, 

settling, or otherwise resolving the Estate Claims. Any proceeds therefrom shall be distributed by 

the Litigation Sub-Trust to the Claimant Trust for distribution to the Claimant Trust Beneficiaries 

pursuant to the terms of the Claimant Trust Agreement. 

5. Claimant Trust Agreement and Litigation Sub-Trust Agreement. 

The Claimant Trust Agreement generally will provide for, among other things: 

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(i) the payment of the Claimant Trust Expenses; 

(ii) the payment of other reasonable expenses of the Claimant Trust; 

(iii) the retention of employees, counsel, accountants, financial advisors, or other 

professionals and the payment of their reasonable compensation; 

(iv) the investment of Cash by the Claimant Trustee within certain limitations, 

including those specified in the Plan; 

(v) the orderly monetization of the Claimant Trust Assets; 

(vi) litigation of any Causes of Action, which may include the prosecution, 

settlement, abandonment, or dismissal of any such Causes of Action, subject to reporting and 

oversight by the Claimant Trust Oversight Committee; 

(vii) the resolution of Claims and Equity Interests in Class 8 through Class 11, 

subject to reporting and oversight by the Claimant Trust Oversight Committee; 

(viii) the administration of the Disputed Claims Reserve and distributions to be made 

therefrom; and 

(ix) the management of the Reorganized Debtor, including the utilization of a SubServicer, with the Claimant Trust serving as the managing member of New GP LLC. 

Except as otherwise ordered by the Bankruptcy Court, the Claimant Trust Expenses shall 

be paid from the Claimant Trust Assets in accordance with the Plan and Claimant Trust Agreement. 

The Claimant Trustee may establish a reserve for the payment of Claimant Trust Expense 

(including, without limitation, any reserve for potential indemnification claims as authorized and 

provided under the Claimant Trust Agreement), and shall periodically replenish such reserve, as 

necessary. 

In furtherance of, and consistent with the purpose of, the Claimant Trust and the Plan, the 

Trustees, for the benefit of the Claimant Trust, shall, subject to reporting and oversight by the 

Claimant Trust Oversight Committee as set forth in the Claimant Trust Agreement: (i) hold the 

Claimant Trust Assets for the benefit of the Claimant Trust Beneficiaries, (ii) make Distributions 

to the Claimant Trust Beneficiaries as provided herein and in the Claimant Trust Agreement, and 

(iii) have the sole power and authority to prosecute and resolve any Causes of Action and 

objections to Claims and Equity Interests (other than those assigned to the Litigation Sub-Trust), 

without approval of the Bankruptcy Court. Except as otherwise provided in the Claimant Trust 

Agreement, the Claimant Trustee shall be responsible for all decisions and duties with respect to 

the Claimant Trust and the Claimant Trust Assets; provided, however, that the prosecution and 

resolution of any Estate Claims included in the Claimant Trust Assets shall be the responsibility 

of the Litigation Trustee. The Litigation Sub-Trust Agreement generally will provide for, among 

other things: 

(i) the payment of other reasonable expenses of the Litigation Sub-Trust; 

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(ii) the retention of employees, counsel, accountants, financial advisors, or other 

professionals and the payment of their reasonable compensation; and 

(iii) the investigation and prosecution of Estate Claims, which may include the 

prosecution, settlement, abandonment, or dismissal of any such Estate Claims, subject to reporting 

and oversight as set forth in the Litigation Sub-Trust Agreement. 

The Trustees, on behalf of the Claimant Trust and Litigation Sub-Trust, as applicable, may 

each employ, without further order of the Bankruptcy Court, employees and other professionals 

(including those previously retained by the Debtor and the Committee) to assist in carrying out the 

Trustees’ duties hereunder and may compensate and reimburse the reasonable expenses of these 

professionals without further Order of the Bankruptcy Court from the Claimant Trust Assets in 

accordance with the Plan and the Claimant Trust Agreement. 

The Claimant Trust Agreement and Litigation Sub-Trust Agreement may include 

reasonable and customary provisions that allow for indemnification by the Claimant Trust in favor 

of the Claimant Trustee, Litigation Trustee, and the Claimant Trust Oversight Committee. Any 

such indemnification shall be the sole responsibility of the Claimant Trust and payable solely from 

the Claimant Trust Assets. 

6. Compensation and Duties of Trustees. 

The salient terms of each Trustee’s employment, including such Trustee’s duties and 

compensation shall be set forth in the Claimant Trust Agreement and the Litigation Sub-Trust 

Agreement, as appropriate. The Trustees shall each be entitled to reasonable compensation in an 

amount consistent with that of similar functionaries in similar types of bankruptcy cases. 

7. Cooperation of Debtor and Reorganized Debtor. 

To effectively investigate, prosecute, compromise and/or settle the Claims and/or Causes 

of Action that constitute Claimant Trust Assets (including Estate Claims), the Claimant Trustee, 

Litigation Trustee, and each of their professionals may require reasonable access to the Debtor’s 

and Reorganized Debtor’s documents, information, and work product relating to the Claimant 

Trust Assets. Accordingly, the Debtor and the Reorganized Debtor, as applicable, shall reasonably 

cooperate with the Claimant Trustee and Litigation Trustee, as applicable, in their prosecution of 

Causes of Action and in providing the Claimant Trustee and Litigation Trustee with copies of 

documents and information in the Debtor’s possession, custody, or control on the Effective Date 

that either Trustee indicates relates to the Estate Claims or other Causes of Action. 

The Debtor and Reorganized Debtor shall preserve all records, documents or work product 

(including all electronic records, documents, or work product) related to the Claims and Causes of 

Action, including Estate Claims, until the earlier of (a) the dissolution of the Reorganized Debtor 

or (b) termination of the Claimant Trust and Litigation Sub-Trust. 

8. United States Federal Income Tax Treatment of the Claimant Trust. 

Unless the IRS requires otherwise, for all United States federal income tax purposes, the 

parties shall treat the transfer of the Claimant Trust Assets to the Claimant Trust as: (a) a transfer 

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of the Claimant Trust Assets (other than the amounts set aside in the Disputed Claims Reserve, if 

the Claimant Trustee makes the election described in Section 7 below) directly to the applicable 

Claimant Trust Beneficiaries followed by (b) the transfer by the such Claimant Trust Beneficiaries 

to the Claimant Trust of such Claimant Trust Assets in exchange for the Claimant Trust Interests. 

Accordingly, the applicable Claimant Trust Beneficiaries shall be treated for United States federal 

income tax purposes as the grantors and owners of their respective share of the Claimant Trust 

Assets. The foregoing treatment shall also apply, to the extent permitted by applicable law, for 

state and local income tax purposes. 

9. Tax Reporting. 

(a) The Claimant Trustee shall file tax returns for the Claimant Trust treating the Claimant 

Trust as a grantor trust pursuant to Treasury Regulation section 1.671-4(a). The Claimant Trustee 

may file an election pursuant to Treasury Regulation 1.468B-9(c) to treat the Disputed Claims 

Reserve as a disputed ownership fund, in which case the Claimant Trustee will file federal income 

tax returns and pay taxes for the Disputed Claims Reserve as a separate taxable entity. 

(b) The Claimant Trustee shall be responsible for payment, out of the Claimant Trust 

Assets, of any taxes imposed on the Claimant Trust or its assets. 

(c) The Claimant Trustee shall determine the fair market value of the Claimant Trust Assets 

as of the Effective Date and notify the applicable Claimant Trust Beneficiaries of such valuation, 

and such valuation shall be used consistently for all federal income tax purposes. 

(d) The Claimant Trustee shall distribute such tax information to the applicable Claimant 

Trust Beneficiaries as the Claimant Trustee determines is required by applicable law. 

10. Claimant Trust Assets. 

The Claimant Trustee shall have the exclusive right, on behalf of the Claimant Trust, to 

institute, file, prosecute, enforce, abandon, settle, compromise, release, or withdraw any and all 

Causes of Action included in the Claimant Trust Assets (except for the Estate Claims) without any 

further order of the Bankruptcy Court, and the Claimant Trustee shall have the exclusive right, on 

behalf of the Claimant Trust, to sell, liquidate, or otherwise monetize all Claimant Trust Assets, 

except as otherwise provided in this Plan or in the Claimant Trust Agreement, without any further 

order of the Bankruptcy Court. Notwithstanding anything herein to the contrary, the Litigation 

Trustee shall have the exclusive right to institute, file, prosecute, enforce, abandon, settle, 

compromise, release, or withdraw any and all Estate Claims included in the Claimant Trust Assets 

without any further order of the Bankruptcy Court. 

From and after the Effective Date, the Trustees, in accordance with section 1123(b)(3) and 

(4) of the Bankruptcy Code, and on behalf of the Claimant Trust, shall each serve as a 

representative of the Estate with respect to any and all Claimant Trust Assets, including the Causes 

of Action and Estate Claims, as appropriate, and shall retain and possess the right to (a) commence, 

pursue, settle, compromise, or abandon, as appropriate, any and all Causes of Action in any court 

or other tribunal and (b) sell, liquidate, or otherwise monetize all Claimant Trust Assets. 

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11. Claimant Trust Expenses. 

From and after the Effective Date, the Claimant Trust shall, in the ordinary course of 

business and without the necessity of any approval by the Bankruptcy Court, pay the reasonable 

professional fees and expenses incurred by the Claimant Trust, the Litigation Sub-Trust, and any 

professionals retained by such parties and entities from the Claimant Trust Assets, except as 

otherwise provided in the Claimant Trust Agreement. 

12. Trust Distributions to Claimant Trust Beneficiaries. 

The Claimant Trustee, in its discretion, may make Trust Distributions to the Claimant Trust 

Beneficiaries at any time and/or use the Claimant Trust Assets or proceeds thereof, provided that 

such Trust Distributions or use is otherwise permitted under the terms of the Plan, the Claimant 

Trust Agreement, and applicable law. 

13. Cash Investments. 

With the consent of the Claimant Trust Oversight Committee, the Claimant Trustee may 

invest Cash (including any earnings thereon or proceeds therefrom) in a manner consistent with 

the terms of the Claimant Trust Agreement; provided, however, that such investments are 

investments permitted to be made by a “liquidating trust” within the meaning of Treasury 

Regulation section 301.7701-4(d), as reflected therein, or under applicable IRS guidelines, rulings 

or other controlling authorities. 

14. Dissolution of the Claimant Trust and Litigation Sub-Trust. 

The Trustees and the Claimant Trust and Litigation Sub-Trust shall be discharged or 

dissolved, as the case may be, at such time as: (a) the Litigation Trustee determines that the pursuit 

of Estate Claims is not likely to yield sufficient additional proceeds to justify further pursuit of 

such Estate Claims, (b) the Claimant Trustee determines that the pursuit of Causes of Action (other 

than Estate Claims) is not likely to yield sufficient additional proceeds to justify further pursuit of 

such Causes of Action, (c) the Clamant Trustee determines that the pursuit of sales of other 

Claimant Trust Assets is not likely to yield sufficient additional proceeds to justify further pursuit 

of such sales of Claimant Trust Assets, (d) all objections to Disputed Claims and Equity Interests 

are fully resolved, (e) the Reorganized Debtor is dissolved, and (f) all Distributions required to be 

made by the Claimant Trustee to the Claimant Trust Beneficiaries under the Plan have been made, 

but in no event shall the Claimant Trust be dissolved later than three years from the Effective Date 

unless the Bankruptcy Court, upon motion made within the six-month period before such third 

anniversary (and, in the event of further extension, by order of the Bankruptcy Court, upon motion 

made at least six months before the end of the preceding extension), determines that a fixed period 

extension (not to exceed two years, together with any prior extensions, without a favorable letter 

ruling from the Internal Revenue Service or an opinion of counsel that any further extension would 

not adversely affect the status of the Claimant Trust as a liquidating trust for federal income tax 

purposes) is necessary to facilitate or complete the recovery on, and liquidation of, the Claimant 

Trust Assets; provided, however, that each extension must be approved, upon a finding that the 

extension is necessary to facilitate or complete the recovery on, and liquidation of the Claimant 

Trust Assets, by the Bankruptcy Court within 6 months of the beginning of the extended term and 

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no extension, together with any prior extensions, shall exceed three years without a favorable letter 

ruling from the Internal Revenue Service or an opinion of counsel that any further extension would 

not adversely affect the status of the Claimant Trust as a liquidating trust for federal income tax 

purposes. 

Upon dissolution of the Claimant Trust, and pursuant to the Claimant Trust Agreement, 

any remaining Claimant Trust Assets that exceed the amounts required to be paid under the Plan 

will be transferred (in the sole discretion of the Claimant Trustee) in Cash or in-kind to the Holders 

of the Claimant Trust Interests as provided in the Claimant Trust Agreement. 

C. The Reorganized Debtor 

1. Corporate Existence 

The Debtor will continue to exist after the Effective Date, with all of the powers of 

partnerships pursuant to the law of the State of Delaware and as set forth in the Reorganized 

Limited Partnership Agreement. 

2. Cancellation of Equity Interests and Release 

On the Effective Date, (i) all prepetition Equity Interests, including the Class A Limited 

Partnership Interests and the Class B/C Limited Partnership Interests, in the Debtor shall be 

canceled, and (ii) all obligations or debts owed by, or Claims against, the Debtor on account of, or 

based upon, the Interests shall be deemed as cancelled, released, and discharged, including all 

obligations or duties by the Debtor relating to the Equity Interests in any of the Debtor’s formation 

documents, including the Limited Partnership Agreement. 

3. Issuance of New Partnership Interests 

On the Effective Date, the Debtor or the Reorganized Debtor, as applicable, will issue new 

Class A Limited Partnership Interests to (i) the Claimant Trust, as limited partner, and (ii) New 

GP LLC, as general partner, and will admit (a) the Claimant Trust as the limited partner of the 

Reorganized Debtor, and (b) New GP LLC as the general partner of the Reorganized Debtor. The 

Claimant Trust, as limited partner, will ratify New GP LLC’s appointment as general partner of 

the Reorganized Debtor. Also, on the Effective Date, the Claimant Trust, as limited partner, and 

New GP LLC, as general partner, will execute the Reorganized Limited Partnership Agreement 

and receive partnership interests in the Reorganized Debtor consistent with the terms of the 

Reorganized Limited Partnership Agreement. 

The Reorganized Limited Partnership Agreement does not provide for, and specifically 

disclaims, the indemnification obligations under the Limited Partnership Agreement, including 

any such indemnification obligations that accrued or arose or could have been brought prior to the 

Effective Date. Any indemnification Claims under the Limited Partnership Agreement that 

accrued, arose, or could have been filed prior to the Effective Date will be resolved through the 

Claims resolution process provided that a Claim is properly filed in accordance with the 

Bankruptcy Code, the Plan, or the Bar Date Order. Each of the Debtor, the Reorganized Debtor, 

the Claimant Trust, and the Litigation Sub-Trust reserve all rights with respect to any such 

indemnification Claims. 

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4. Management of the Reorganized Debtor 

Subject to and consistent with the terms of the Reorganized Limited Partnership 

Agreement, the Reorganized Debtor shall be managed by its general partner, New GP LLC. The 

initial officers and employees of the Reorganized Debtor shall be selected by the Claimant Trustee. 

The Reorganized Debtor may, in its discretion, also utilize a Sub-Servicer in addition to or in lieu 

of the retention of officers and employees. 

As set forth in the Reorganized Limited Partnership Agreement, New GP LLC will receive 

a fee for managing the Reorganized Debtor. Although New GP LLC will be a limited liability 

company, it will elect to be treated as a C-Corporation for tax purposes. Therefore, New GP LLC 

(and any taxable income attributable to it) will be subject to corporate income taxation on a 

standalone basis, which may reduce the return to Claimants. 

5. Vesting of Assets in the Reorganized Debtor 

Except as otherwise provided in this Plan or the Confirmation Order, on or after the 

Effective Date, all Reorganized Debtor Assets will vest in the Reorganized Debtor, free and clear 

of all Liens, Claims, charges or other encumbrances pursuant to section 1141(c) of the Bankruptcy 

Code except with respect to such Liens, Claims, charges and other encumbrances that are 

specifically preserved under this Plan upon the Effective Date. 

The Reorganized Debtor shall be the exclusive trustee of the Reorganized Debtor Assets 

for purposes of 31 U.S.C. § 3713(b) and 26 U.S.C. § 6012(b)(3), as well as the representative of 

the Estate appointed pursuant to section 1123(b)(3)(B) of the Bankruptcy Code with respect to the 

Reorganized Debtor Assets. 

6. Purpose of the Reorganized Debtor 

Except as may be otherwise provided in this Plan or the Confirmation Order, the 

Reorganized Debtor will continue to manage the Reorganized Debtor Assets (which shall include, 

for the avoidance of doubt, serving as the investment manager of the Managed Funds) and may 

use, acquire or dispose of the Reorganized Debtor Assets and compromise or settle any Claims 

with respect to the Reorganized Debtor Assets without supervision or approval by the Bankruptcy 

Court and free of any restrictions of the Bankruptcy Code or Bankruptcy Rules. The Reorganized 

Debtor shall oversee the resolution of Claims in Class 1 through Class 7. 

Without limiting the foregoing, the Reorganized Debtor will pay the charges that it incurs 

after the Effective Date for Professionals’ fees, disbursements, expenses or related support services 

(including reasonable fees relating to the preparation of Professional fee applications) in the 

ordinary course of business and without application or notice to, or order of, the Bankruptcy Court. 

7. Distribution of Proceeds from the Reorganized Debtor Assets; Transfer of 

Reorganized Debtor Assets 

Any proceeds received by the Reorganized Debtor will be distributed to the Claimant Trust, 

as limited partner, and New GP LLC, as general partner, in the manner set forth in the Reorganized 

Limited Partnership Agreement. As set forth in the Reorganized Limited Partnership Agreement, 

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the Reorganized Debtor may, from time to time distribute Reorganized Debtor Assets to the 

Claimant Trust either in Cash or in-kind, including to institute the wind-down and dissolution of 

the Reorganized Debtor. Any assets distributed to the Claimant Trust will be (i) deemed 

transferred in all respects as forth in ARTICLE IV.B.1, (ii) deemed Claimant Trust Assets, and 

(iii) administered as Claimant Trust Assets. 

D. Company Action 

Each of the Debtor, the Reorganized Debtor, and the Trustees, as applicable, may take any 

and all actions 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 implement the provisions of this Plan, the Claimant Trust Agreement, the Reorganized Limited 

Partnership Agreement, or the New GP LLC Documents, as applicable, in the name of and on 

behalf of the Debtor, the Reorganized Debtor, or the Trustees, as applicable, and in each case 

without further notice to or order of the Bankruptcy Court, act or action under applicable law, 

regulation, order, or rule or any requirement of further action, vote or other approval or 

authorization by the security holders, officers, or directors of the Debtor or the Reorganized 

Debtor, as applicable, or by any other Person. 

Prior to, on or after the Effective Date (as appropriate), all matters provided for pursuant 

to this Plan that would otherwise require approval of the stockholders, partners, directors, 

managers, or members of the Debtor, any Related Entity, or any Affiliate thereof (as of prior to 

the Effective Date) will be deemed to have been so approved and will be in effect prior to, on or 

after the Effective Date (as appropriate) pursuant to applicable law and without any requirement 

of further action by the stockholders, partners, directors, managers or members of such Persons, 

or the need for any approvals, authorizations, actions or consents of any Person. 

All matters provided for in this Plan involving the legal or corporate structure of the Debtor, 

the Reorganized Debtor, or the Claimant Trust, as applicable, and any legal or corporate action 

required by the Debtor, the Reorganized Debtor, or the Claimant Trust, as applicable, in connection 

with this Plan, will be deemed to have occurred and will be in full force and effect in all respects, 

in each case without further notice to or order of the Bankruptcy Court, act or action under 

applicable law, regulation, order, or rule or any requirement of further action, vote or other 

approval or authorization by the security holders, partners, directors, managers, or members of the 

Debtor, the Reorganized Debtor, or the Claimant Trust, as applicable, or by any other Person. On 

the Effective Date, the appropriate officers of the Debtor and the Reorganized Debtor, as 

applicable, as well as the Trustees, are authorized to issue, execute, deliver, and consummate the 

transactions contemplated by, the contracts, agreements, documents, guarantees, pledges, 

consents, securities, certificates, resolutions and instruments contemplated by or described in this 

Plan in the name of and on behalf of the Debtor and the Reorganized Debtor, as well as the 

Trustees, in each case without further notice to or order of the Bankruptcy Court, act or action 

under applicable law, regulation, order, or rule or any requirement of further action, vote or other 

approval or authorization by any Person. The appropriate officer of the Debtor, the Reorganized 

Debtor, as well as the Trustees, will be authorized to certify or attest to any of the foregoing actions. 

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E. Release of Liens, Claims and Equity Interests 

Except as otherwise provided in the Plan or in any contract, instrument, release or other 

agreement or document entered into or delivered in connection with the Plan, from and after the 

Effective Date and concurrently with the applicable distributions made pursuant to the Plan, all 

Liens, Claims, Equity Interests, mortgages, deeds of trust, or other security interests against the 

property of the Estate will be fully released, terminated, extinguished and discharged, in each case 

without further notice to or order of the Bankruptcy Court, act or action under applicable law, 

regulation, order, or rule or the vote, consent, authorization or approval of any Entity. Any Entity 

holding such Liens or Equity Interests extinguished pursuant to the prior sentence will, pursuant 

to section 1142 of the Bankruptcy Code, promptly execute and deliver to the Debtor, the 

Reorganized Debtor, or the Claimant Trustee, as applicable, such instruments of termination, 

release, satisfaction and/or assignment (in recordable form) as may be reasonably requested by the 

Debtor, the Reorganized Debtor, or the Claimant Trustee, as applicable. For the avoidance of 

doubt, this section is in addition to, and shall not be read to limit in any respects, ARTICLE IV.C.2. 

F. Cancellation of Notes, Certificates and Instruments 

Except for the purpose of evidencing a right to a distribution under this Plan and except as 

otherwise set forth in this Plan, on the Effective Date, all agreements, instruments, Securities and 

other documents evidencing any prepetition Claim or Equity Interest and any rights of any Holder 

in respect thereof shall be deemed cancelled, discharged, and of no force or effect. The holders of 

or parties to such cancelled instruments, Securities, and other documentation will have no rights 

arising from or related to such instruments, Securities, or other documentation or the cancellation 

thereof, except the rights provided for pursuant to this Plan, and the obligations of the Debtor 

thereunder or in any way related thereto will be fully released, terminated, extinguished and 

discharged, in each case without further notice to or order of the Bankruptcy Court, act or action 

under applicable law, regulation, order, or rule or any requirement of further action, vote or other 

approval or authorization by any Person. For the avoidance of doubt, this section is in addition to, 

and shall not be read to limit in any respects, ARTICLE IV.C.2. 

G. Cancellation of Existing Instruments Governing Security Interests 

Upon payment or other satisfaction of an Allowed Class 1 or Allowed Class 2 Claim, or 

promptly thereafter, the Holder of such Allowed Class 1 or Allowed Class 2 Claim shall deliver to 

the Debtor, the Reorganized Debtor, or the Claimant Trustee, as applicable, any collateral or other 

property of the Debtor held by such Holder, together with any termination statements, instruments 

of satisfaction, or releases of all security interests with respect to its Allowed Class 1 or Allowed 

Class 2 Claim that may be reasonably required to terminate any related financing statements, 

mortgages, mechanics’ or other statutory Liens, or lis pendens, or similar interests or documents. 

H. Control Provisions 

To the extent that there is any inconsistency between this Plan as it relates to the Claimant 

Trust, the Claimant Trust Agreement, the Reorganized Debtor, or the Reorganized Limited 

Partnership Agreement, this Plan shall control. 

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I. Treatment of Vacant Classes

Any Claim or Equity Interest in a Class considered vacant under ARTICLE III.C of this 

Plan shall receive no Plan Distributions. 

J. Plan Documents 

The documents, if any, to be Filed as part of the Plan Documents, including any documents 

filed with the Plan Supplement, and any amendments, restatements, supplements, or other 

modifications to such documents, and any consents, waivers, or other deviations under or from 

any such documents, shall be incorporated herein by this reference (including to the applicable 

definitions in ARTICLE I hereof) and fully enforceable as if stated in full herein. 

The Debtor and the Committee are currently working to finalize the forms of certain of the 

Plan Documents to be filed with the Plan Supplement. To the extent that the Debtor and the 

Committee cannot agree as to the form and content of such Plan Documents, they intend to submit 

the issue to non-binding mediation pursuant to the Order Directing Mediation entered on August 

3, 2020 [D.I. 912]. 

K. Highland Capital Management, L.P. Retirement Plan and Trust 

The Highland Capital Management, L.P. Retirement Plan And Trust (“Pension Plan”) is a 

single-employer defined benefit pension plan covered by Title IV of the Employee Retirement 

Income Security Act of 1974, as amended (“ERISA”). 29 U.S.C. §§ 1301-1461. The Debtor is 

the contributing sponsor and, as such, the PBGC asserts that the Debtor is liable along with any 

members of the contributing sponsor’s controlled-group within the meaning of 29 U.S.C. §§ 

1301(a)(13), (14) with respect to the Pension Plan. 

Upon the Effective Date, the Reorganized Debtor shall be deemed to have assumed the 

Pension Plan and shall comply with all applicable statutory provisions of ERISA and the Internal 

Revenue Code (the “IRC”), including, but not limited to, satisfying the minimum funding 

standards pursuant to 26 U.S.C. §§ 412, 430, and 29 U.S.C. §§ 1082, 1083; paying the PBGC 

premiums in accordance with 29 U.S.C. §§ 1306 and 1307; and administering the Pension Plan in 

accordance with its terms and the provisions of ERISA and the IRC. In the event that the Pension 

Plan terminates after the Plan of Reorganization Effective Date, the PBGC asserts that the 

Reorganized Debtor and each of its controlled group members will be responsible for the liabilities 

imposed by Title IV of ERISA. 

Notwithstanding any provision of the Plan, the Confirmation Order, or the Bankruptcy 

Code (including section 1141 thereof) to the contrary, neither the Plan, the Confirmation Order, or 

the Bankruptcy Code shall be construed as discharging, releasing, exculpating or relieving the 

Debtor, the Reorganized Debtor, or any person or entity in any capacity, from any liability or 

responsibility, if any, with respect to the Pension Plan under any law, governmental policy, or 

regulatory provision. PBGC and the Pension Plan shall not be enjoined or precluded from 

enforcing such liability or responsibility against any person or entity as a result of any of the 

provisions of the Plan, the Confirmation Order, or the Bankruptcy Code. The Debtor reserves the 

right to contest any such liability or responsibility. 

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ARTICLE V.

TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES 

A. Assumption, Assignment, or Rejection of Executory Contracts and Unexpired Leases 

Unless an Executory Contract or Unexpired Lease: (i) was previously assumed or rejected 

by the Debtor pursuant to this Plan on or prior to the Confirmation Date; (ii) previously expired or 

terminated pursuant to its own terms or by agreement of the parties thereto; (iii) is the subject of a 

motion to assume filed by the Debtor on or before the Confirmation Date; (iv) contains a change 

of control or similar provision that would be triggered by the Chapter 11 Case (unless such 

provision has been irrevocably waived); or (v) is specifically designated as a contract or lease to 

be assumed in the Plan or the Plan Supplement, on the Confirmation Date, each Executory Contract 

and Unexpired Lease shall be deemed rejected pursuant to section 365 of the Bankruptcy Code, 

without the need for any further notice to or action, order, or approval of the Bankruptcy Court, 

unless such Executory Contract or Unexpired Lease is listed in the Plan Supplement. 

At any time on or prior to the Confirmation Date, the Debtor may (i) amend the Plan 

Supplement in order to add or remove a contract or lease from the list of contracts to be assumed 

or (ii) assign (subject to applicable law) any Executory Contract or Unexpired Lease, as determined 

by the Debtor in consultation with the Committee, or the Reorganized Debtor, as applicable. 

The Confirmation Order will constitute an order of the Bankruptcy Court approving the 

above-described assumptions, rejections, and assumptions and assignments. Except as otherwise 

provided herein or agreed to by the Debtor and the applicable counterparty, each assumed 

Executory Contract or Unexpired Lease shall include all modifications, amendments, supplements, 

restatements, or other agreements related thereto, and all rights related thereto. Modifications, 

amendments, supplements, and restatements to prepetition Executory Contracts and Unexpired 

Leases that have been executed by the Debtor during the Chapter 11 Case shall not be deemed to 

alter the prepetition nature of the Executory Contract or Unexpired Lease or the validity, priority, 

or amount of any Claims that may arise in connection therewith. To the extent applicable, no 

change of control (or similar provision) will be deemed to occur under any such Executory 

Contract or Unexpired Lease. 

If certain, but not all, of a contract counterparty’s Executory Contracts and/or Unexpired 

Leases are rejected pursuant to the Plan, the Confirmation Order shall be a determination that such 

counterparty’s Executory Contracts and/or Unexpired Leases that are being assumed pursuant to 

the Plan are severable agreements that are not integrated with those Executory Contracts and/or 

Unexpired Leases that are being rejected pursuant to the Plan. Parties seeking to contest this 

finding with respect to their Executory Contracts and/or Unexpired Leases must file a timely 

objection to the Plan on the grounds that their agreements are integrated and not severable, and 

any such dispute shall be resolved by the Bankruptcy Court at the Confirmation Hearing (to the 

extent not resolved by the parties prior to the Confirmation Hearing). 

Notwithstanding anything herein to the contrary, the Debtor shall assume or reject that 

certain real property lease with Crescent TC Investors L.P. (“Landlord”) for the Debtor’s 

headquarters located at 200/300 Crescent Ct., Suite #700, Dallas, Texas 75201 (the “Lease”) in 

accordance with the notice to Landlord, procedures and timing required by 11 U.S.C. §365(d)(4), 

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38 

as modified by that certain Agreed Order Granting Motion to Extend Time to Assume or Reject 

Unexpired Nonresidential Real Property Lease [Docket No. 1122]. 

B. Claims Based on Rejection of Executory Contracts or Unexpired Leases 

Any Executory Contract or Unexpired Lease not assumed or rejected on or before the 

Confirmation Date shall be deemed rejected, pursuant to the Confirmation Order. Any Person 

asserting a Rejection Claim shall File a proof of claim within thirty days of the Confirmation Date. 

Any Rejection Claims that are not timely Filed pursuant to this Plan shall be forever disallowed 

and barred. If one or more Rejection Claims are timely Filed, the Claimant Trustee may File an 

objection to any Rejection Claim. 

Rejection Claims shall be classified as General Unsecured Claims and shall be treated in 

accordance with ARTICLE III of this Plan. 

C. Cure of Defaults for Assumed or Assigned Executory Contracts and Unexpired 

Leases 

Any monetary amounts by which any Executory Contract or Unexpired Lease to be 

assumed or assigned hereunder is in default shall be satisfied, under section 365(b)(1) of the 

Bankruptcy Code, by the Debtor upon assumption or assignment thereof, by payment of the default 

amount in Cash as and when due in the ordinary course or on such other terms as the parties to 

such Executory Contracts may otherwise agree. The Debtor may serve a notice on the Committee 

and parties to Executory Contracts or Unexpired Leases to be assumed or assigned reflecting the 

Debtor’s or Reorganized Debtor’s intention to assume or assign the Executory Contract or 

Unexpired Lease in connection with this Plan and setting forth the proposed cure amount (if any). 

If a dispute regarding (1) the amount of any payments to cure a default, (2) the ability of 

the Debtor, the Reorganized Debtor, or any assignee to provide “adequate assurance of future 

performance” (within the meaning of section 365 of the Bankruptcy Code) under the Executory 

Contract or Unexpired Lease to be assumed or assigned or (3) any other matter pertaining to 

assumption or assignment, the cure payments required by section 365(b)(1) of the Bankruptcy 

Code will be made following the entry of a Final Order or orders resolving the dispute and 

approving the assumption or assignment. 

Assumption or assignment of any Executory Contract or Unexpired Lease pursuant to the 

Plan or otherwise and full payment of any applicable cure amounts pursuant to this ARTICLE V.C 

shall result in the full release and satisfaction of any cure amounts, Claims, or defaults, whether 

monetary or nonmonetary, including defaults of provisions restricting the change in control or 

ownership interest composition or other bankruptcy-related defaults, arising under any assumed or 

assigned Executory Contract or Unexpired Lease at any time prior to the effective date of 

assumption or assignment. Any and all Proofs of Claim based upon Executory Contracts or 

Unexpired Leases that have been assumed or assigned in the Chapter 11 Case, including pursuant 

to the Confirmation Order, and for which any cure amounts have been fully paid pursuant to this 

ARTICLE V.C, shall be deemed disallowed and expunged as of the Confirmation Date without 

the need for any objection thereto or any further notice to or action, order, or approval of the 

Bankruptcy Court. 

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001250

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39 

ARTICLE VI.

PROVISIONS GOVERNING DISTRIBUTIONS 

A. Dates of Distributions 

Except as otherwise provided in this Plan, on the Effective Date or as soon as reasonably 

practicable thereafter (or if a Claim is not an Allowed Claim or Equity Interest on the Effective 

Date, on the date that such Claim or Equity Interest becomes an Allowed Claim or Equity Interest, 

or as soon as reasonably practicable thereafter), each Holder of an Allowed Claim or Equity 

Interest against the Debtor shall receive the full amount of the distributions that this Plan provides 

for Allowed Claims or Allowed Equity Interests in the applicable Class and in the manner provided 

herein. If any payment or act under this Plan is required to be made or performed on a date that is 

not on a Business Day, then the making of such payment or the performance of such act may be 

completed on the next succeeding Business Day, but shall be deemed to have been completed as 

of the required date. If and to the extent there are Disputed Claims or Equity Interests, distributions 

on account of any such Disputed Claims or Equity Interests shall be made pursuant to the 

provisions provided in this Plan. Except as otherwise provided in this Plan, Holders of Claims and 

Equity Interests shall not be entitled to interest, dividends or accruals on the distributions provided 

for therein, regardless of whether distributions are delivered on or at any time after the Effective 

Date. 

Upon the Effective Date, all Claims and Equity Interests against the Debtor shall be deemed 

fixed and adjusted pursuant to this Plan and none of the Debtor, the Reorganized Debtor, or the 

Claimant Trust will have liability on account of any Claims or Equity Interests except as set forth 

in this Plan and in the Confirmation Order. All payments and all distributions made by the 

Distribution Agent under this Plan shall be in full and final satisfaction, settlement and release of 

all Claims and Equity Interests against the Debtor and the Reorganized Debtor. 

At the close of business on the Distribution Record Date, the transfer ledgers for the Claims 

against the Debtor and the Equity Interests in the Debtor shall be closed, and there shall be no 

further changes in the record holders of such Claims and Equity Interests. The Debtor, the 

Reorganized Debtor, the Trustees, and the Distribution Agent, and each of their respective agents, 

successors, and assigns shall have no obligation to recognize the transfer of any Claims against the 

Debtor or Equity Interests in the Debtor occurring after the Distribution Record Date and shall be 

entitled instead to recognize and deal for all purposes hereunder with only those record holders 

stated on the transfer ledgers as of the close of business on the Distribution Record Date 

irrespective of the number of distributions to be made under this Plan to such Persons or the date 

of such distributions. 

B. Distribution Agent 

Except as provided herein, all distributions under this Plan shall be made by the Claimant 

Trustee, as Distribution Agent, or by such other Entity designated by the Claimant Trustee, as a 

Distribution Agent on the Effective Date or thereafter. The Reorganized Debtor will be the 

Distribution Agent with respect to Claims in Class 1 through Class 7. 

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001251

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The Claimant Trustee, or such other Entity designated by the Claimant Trustee to be the 

Distribution Agent, shall not be required to give any bond or surety or other security for the 

performance of such Distribution Agent’s duties unless otherwise ordered by the Bankruptcy 

Court. 

The Distribution Agent shall be empowered to (a) effect all actions and execute all 

agreements, instruments, and other documents necessary to perform its duties under this Plan; 

(b) make all distributions contemplated hereby; (c) employ professionals to represent it with 

respect to its responsibilities; and (d) exercise such other powers as may be vested in the 

Distribution Agent by order of the Bankruptcy Court, pursuant to this Plan, or as deemed by the 

Distribution Agent to be necessary and proper to implement the provisions hereof. 

The Distribution Agent shall not have any obligation to make a particular distribution to a 

specific Holder of an Allowed Claim if such Holder is also the Holder of a Disputed Claim. 

C. Cash Distributions 

Distributions of Cash may be made by wire transfer from a domestic bank, except that Cash 

payments made to foreign creditors may be made in such funds and by such means as the 

Distribution Agent determines are necessary or customary in a particular foreign jurisdiction. 

D. Disputed Claims Reserve 

On or prior to the Initial Distribution Date, the Claimant Trustee shall establish, fund and 

maintain the Disputed Claims Reserve(s) in the appropriate Disputed Claims Reserve Amounts on 

account of any Disputed Claims. 

E. Distributions from the Disputed Claims Reserve 

The Disputed Claims Reserve shall at all times hold Cash in an amount no less than the 

Disputed Claims Reserve Amount. To the extent a Disputed Claim becomes an Allowed Claim 

pursuant to the terms of this Plan, within 30 days of the date on which such Disputed Claim 

becomes an Allowed Claim pursuant to the terms of this Plan, the Claimant Trustee shall distribute 

from the Disputed Claims Reserve to the Holder thereof any prior distributions, in Cash, that would 

have been made to such Allowed Claim if it had been Allowed as of the Effective Date. For the 

avoidance of doubt, each Holder of a Disputed Claim that subsequently becomes an Allowed 

Claim will also receive its Pro Rata share of the Claimant Trust Interests. If, upon the resolution 

of all Disputed Claims any Cash remains in the Disputed Claims Reserve, such Cash shall be 

transferred to the Claimant Trust and be deemed a Claimant Trust Asset. 

F. Rounding of Payments 

Whenever this Plan would otherwise call for, with respect to a particular Person, payment 

of a fraction of a dollar, the actual payment or distribution shall reflect a rounding of such fraction 

to the nearest whole dollar (up or down), with half dollars being rounded down. To the extent that 

Cash to be distributed under this Plan remains undistributed as a result of the aforementioned 

rounding, such Cash or stock shall be treated as “Unclaimed Property” under this Plan. 

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001252

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G. De Minimis Distribution 

Except as to any Allowed Claim that is Unimpaired under this Plan, none of the Debtor, 

the Reorganized Debtor, or the Distribution Agent shall have any obligation to make any Plan 

Distributions with a value of less than $100, unless a written request therefor is received by the 

Distribution Agent from the relevant recipient at the addresses set forth in ARTICLE VI.J hereof 

within 120 days after the later of the (i) Effective Date and (ii) the date such Claim becomes an 

Allowed Claim. De minimis distributions for which no such request is timely received shall revert 

to the Claimant Trust. Upon such reversion, the relevant Allowed Claim (and any Claim on 

account of missed distributions) shall be automatically deemed satisfied, discharged and forever 

barred, notwithstanding any federal or state escheat laws to the contrary. 

H. Distributions on Account of Allowed Claims 

Except as otherwise agreed by the Holder of a particular Claim or as provided in this Plan, 

all distributions shall be made pursuant to the terms of this Plan and the Confirmation Order. 

Except as otherwise provided in this Plan, distributions to any Holder of an Allowed Claim shall, 

to the extent applicable, be allocated first to the principal amount of any such Allowed Claim, as 

determined for U.S. federal income tax purposes and then, to the extent the consideration exceeds 

such amount, to the remainder of such Claim comprising accrued but unpaid interest, if any (but 

solely to the extent that interest is an allowable portion of such Allowed Claim). 

I. General Distribution Procedures 

The Distribution Agent shall make all distributions of Cash or other property required 

under this Plan, unless this Plan specifically provides otherwise. All Cash and other property held 

by the Debtor, the Reorganized Debtor, or the Claimant Trust, as applicable, for ultimate 

distribution under this Plan shall not be subject to any claim by any Person. 

J. Address for Delivery of Distributions 

Distributions to Holders of Allowed Claims, to the extent provided for under this Plan, 

shall be made (1) at the addresses set forth in any written notices of address change delivered to 

the Debtor and the Distribution Agent; (2) at the address set forth on any Proofs of Claim Filed by 

such Holders (to the extent such Proofs of Claim are Filed in the Chapter 11 Case), (2), or (3) at 

the addresses in the Debtor’s books and records. 

If there is any conflict or discrepancy between the addresses set forth in (1) through (3) in 

the foregoing sentence, then (i) the address in Section (2) shall control; (ii) if (2) does not apply, 

the address in (1) shall control, and (iii) if (1) does not apply, the address in (3) shall control. 

K. Undeliverable Distributions and Unclaimed Property 

If the distribution to the Holder of any Allowed Claim is returned to the Reorganized 

Debtor or the Claimant Trust as undeliverable, no further distribution shall be made to such Holder, 

and Distribution Agent shall not have any obligation to make any further distribution to the Holder, 

unless and until the Distribution Agent is notified in writing of such Holder’s then current address. 

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001253

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42 

Any Entity that fails to claim any Cash within six months from the date upon which a 

distribution is first made to such Entity shall forfeit all rights to any distribution under this Plan 

and such Cash shall thereafter be deemed an Claimant Trust Asset in all respects and for all 

purposes. Entities that fail to claim Cash shall forfeit their rights thereto and shall have no claim 

whatsoever against the Debtor’s Estate, the Reorganized Debtor, the Claimant Trust, or against 

any Holder of an Allowed Claim to whom distributions are made by the Distribution Agent. 

L. Withholding Taxes 

In connection with this Plan, to the extent applicable, the Distribution Agent shall comply 

with all tax withholding and reporting requirements imposed on them by any Governmental Unit, 

and all distributions made pursuant to this Plan shall be subject to such withholding and reporting 

requirements. The Distribution Agent shall be entitled to deduct any U.S. federal, state or local 

withholding taxes from any Cash payments made with respect to Allowed Claims, as appropriate. 

As a condition to receiving any distribution under this Plan, the Distribution Agent may require 

that the Holder of an Allowed Claim entitled to receive a distribution pursuant to this Plan provide 

such Holder’s taxpayer identification number and such other information and certification as may 

be deemed necessary for the Distribution Agent to comply with applicable tax reporting and 

withholding laws. If a Holder fails to comply with such a request within one year, such distribution 

shall be deemed an unclaimed distribution. Any amounts withheld pursuant hereto shall be deemed 

to have been distributed to and received by the applicable recipient for all purposes of this Plan. 

M. Setoffs 

The Distribution Agent may, to the extent permitted under applicable law, set off against 

any Allowed Claim and any distributions to be made pursuant to this Plan on account of such 

Allowed Claim, the claims, rights and causes of action of any nature that the Debtor, the 

Reorganized Debtor, or the Distribution Agent may hold against the Holder of such Allowed Claim 

that are not otherwise waived, released or compromised in accordance with this Plan; provided, 

however, that neither such a setoff nor the allowance of any Claim hereunder shall constitute a 

waiver or release by the Debtor, the Reorganized Debtor, or the Claimant Trustee of any such 

claims, rights and causes of action that the Debtor, the Reorganized Debtor, or Claimant Trustee 

possesses against such Holder. Any Holder of an Allowed Claim subject to such setoff reserves 

the right to challenge any such setoff in the Bankruptcy Court or any other court with jurisdiction 

with respect to such challenge. 

N. Surrender of Cancelled Instruments or Securities 

As a condition precedent to receiving any distribution pursuant to this Plan on account of 

an Allowed Claim evidenced by negotiable instruments, securities, or notes canceled pursuant to 

ARTICLE IV of this Plan, the Holder of such Claim will tender the applicable negotiable 

instruments, securities, or notes evidencing such Claim (or a sworn affidavit identifying the 

negotiable instruments, securities, or notes formerly held by such Holder and certifying that they 

have been lost), to the Distribution Agent unless waived in writing by the Distribution Agent. 

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001254

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O. Lost, Stolen, Mutilated or Destroyed Securities 

In addition to any requirements under any applicable agreement and applicable law, any 

Holder of a Claim or Equity Interest evidenced by a security or note that has been lost, stolen, 

mutilated, or destroyed will, in lieu of surrendering such security or note to the extent required by 

this Plan, deliver to the Distribution Agent: (i) evidence reasonably satisfactory to the Distribution 

Agent of such loss, theft, mutilation, or destruction; and (ii) such security or indemnity as may be 

required by the Distribution Agent to hold such party harmless from any damages, liabilities, or 

costs incurred in treating such individual as a Holder of an Allowed Claim or Equity Interest. 

Upon compliance with ARTICLE VI.O of this Plan as determined by the Distribution Agent, by a 

Holder of a Claim evidenced by a security or note, such Holder will, for all purposes under this 

Plan, be deemed to have surrendered such security or note to the Distribution Agent. 

ARTICLE VII.

PROCEDURES FOR RESOLVING CONTINGENT, 

UNLIQUIDATED AND DISPUTED CLAIMS 

A. Filing of Proofs of Claim 

Unless such Claim appeared in the Schedules and is not listed as disputed, contingent, or 

unliquidated, or such Claim has otherwise been Allowed or paid, each Holder of a Claim was 

required to file a Proof of Claim on or prior to the Bar Date. 

B. Disputed Claims 

Following the Effective Date, each of the Reorganized Debtor or the Claimant Trustee, as 

applicable, may File with the Bankruptcy Court an objection to the allowance of any Disputed 

Claim or Disputed Equity Interest, request the Bankruptcy Court subordinate any Claims to 

Subordinated Claims, or any other appropriate motion or adversary proceeding with respect to the 

foregoing by the Claims Objection Deadline or, at the discretion of the Reorganized Debtor or 

Claimant Trustee, as applicable, compromised, settled, withdrew or resolved without further order 

of the Bankruptcy Court, and (ii) unless otherwise provided in the Confirmation Order, the 

Reorganized Debtor or the Claimant Trust, as applicable, are authorized to settle, or withdraw any 

objections to, any Disputed Claim or Disputed Equity Interests following the Effective Date 

without further notice to creditors (other than the Entity holding such Disputed Claim or Disputed 

Equity Interest) or authorization of the Bankruptcy Court, in which event such Claim or Equity 

Interest shall be deemed to be an Allowed Claim or Equity Interest in the amount compromised 

for purposes of this Plan. 

C. Procedures Regarding Disputed Claims or Disputed Equity Interests 

No payment or other distribution or treatment shall be made on account of a Disputed 

Claim or Disputed Equity Interest unless and until such Disputed Claim or Disputed Equity Interest 

becomes an Allowed Claim or Equity Interests and the amount of such Allowed Claim or Equity 

Interest, as applicable, is determined by order of the Bankruptcy Court or by stipulation between 

the Reorganized Debtor or Claimant Trust, as applicable, and the Holder of the Claim or Equity 

Interest. 

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001255

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D. Allowance of Claims and Equity Interests 

Following the date on which a Disputed Claim or Disputed Equity Interest becomes an 

Allowed Claim or Equity Interest after the Distribution Date, the Distribution Agent shall make a 

distribution to the Holder of such Allowed Claim or Equity Interest in accordance with the Plan. 

1. Allowance of Claims 

After the Effective Date and subject to the other provisions of this Plan, the Reorganized 

Debtor or the Claimant Trust, as applicable, will have and will retain any and all rights and 

defenses under bankruptcy or nonbankruptcy law that the Debtor had with respect to any Claim. 

Except as expressly provided in this Plan or in any order entered in the Chapter 11 Case prior to 

the Effective Date (including, without limitation, the Confirmation Order), no Claim or Equity 

Interest will become an Allowed Claim or Equity Interest unless and until such Claim or Equity 

Interest is deemed Allowed under this Plan or the Bankruptcy Code or the Bankruptcy Court has 

entered an order, including, without limitation, the Confirmation Order, in the Chapter 11 Case 

allowing such Claim or Equity Interest. 

2. Estimation 

Subject to the other provisions of this Plan, the Debtor, prior to the Effective Date, and the 

Reorganized Debtor or the Claimant Trustee, as applicable, after the Effective Date, may, at any 

time, request that the Bankruptcy Court estimate (a) any Disputed Claim or Disputed Equity 

Interest pursuant to applicable law and in accordance with this Plan and (b) any contingent or 

unliquidated Claim pursuant to applicable law, including, without limitation, section 502(c) of the 

Bankruptcy Code, and the Bankruptcy Court will retain jurisdiction under 28 U.S.C. §§ 157 and 

1334 to estimate any Disputed Claim or Disputed Equity Interest, contingent Claim or unliquidated 

Claim, including during the litigation concerning any objection to any Claim or Equity Interest or 

during the pendency of any appeal relating to any such objection. All of the aforementioned 

objection, estimation and resolution procedures are cumulative and not exclusive of one another. 

Claims or Equity Interests may be estimated and subsequently compromised, settled, withdrawn 

or resolved by any mechanism approved by the Bankruptcy Court. The rights and objections of 

all parties are reserved in connection with any such estimation proceeding. 

3. Disallowance of Claims 

Any Claims or Equity Interests held by Entities from which property is recoverable under 

sections 542, 543, 550, or 553 of the Bankruptcy Code, or that are a transferee of a transfer 

avoidable under sections 522(f), 522(h), 544, 545, 547, 548, 549, or 724(a) of the Bankruptcy 

Code, shall be deemed disallowed pursuant to section 502(d) of the Bankruptcy Code, and holders 

of such Claims or Interests may not receive any distributions on account of such Claims or Interests 

until such time as such Causes of Action against that Entity have been settled or a Bankruptcy 

Court Order with respect thereto has been entered and all sums due, if any, to the Reorganized 

Debtor or the Claimant Trust, as applicable, by that Entity have been turned over or paid to the 

Reorganized Debtor or the Claimant Trust, as applicable. 

EXCEPT AS OTHERWISE PROVIDED HEREIN OR AS AGREED TO BY THE 

DEBTOR, REORGANIZED DEBTOR, OR CLAIMANT TRUSTEE, AS APPLICABLE, 

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001256

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ANY AND ALL PROOFS OF CLAIM FILED AFTER THE BAR DATE SHALL BE 

DEEMED DISALLOWED AND EXPUNGED AS OF THE EFFECTIVE DATE 

WITHOUT ANY FURTHER NOTICE TO OR ACTION, ORDER, OR APPROVAL OF 

THE BANKRUPTCY COURT, AND HOLDERS OF SUCH CLAIMS MAY NOT 

RECEIVE ANY DISTRIBUTIONS ON ACCOUNT OF SUCH CLAIMS, UNLESS SUCH 

LATE PROOF OF CLAIM HAS BEEN DEEMED TIMELY FILED BY A FINAL ORDER.

ARTICLE VIII.

EFFECTIVENESS OF THIS PLAN 

A. Conditions Precedent to the Effective Date 

The Effective Date of this Plan will be conditioned upon the satisfaction or waiver by the 

Debtor (and, to the extent such condition requires the consent of the Committee, the consent of the 

Committee with such consent not to be unreasonably withheld), pursuant to the provisions of 

ARTICLE VIII.B of this Plan of the following: 

x This Plan and the Plan Documents, including the Claimant Trust Agreement and the 

Reorganized Limited Partnership Agreement, and all schedules, documents, 

supplements and exhibits to this Plan shall have been Filed in form and substance 

reasonably acceptable to the Debtor and the Committee. 

x The Confirmation Order shall have become a Final Order and shall be in form and 

substance reasonably acceptable to the Debtor and the Committee. The Confirmation 

Order shall provide that, among other things, (i) the Debtor, the Reorganized Debtor, 

the Claimant Trustee, or the Litigation Trustee are authorized to take all actions 

necessary or appropriate to effectuate and consummate this Plan, including, without 

limitation, (a) entering into, implementing, effectuating, and consummating the 

contracts, instruments, releases, and other agreements or documents created in 

connection with or described in this Plan, (b) assuming the Executory Contracts and 

Unexpired Leases set forth in the Plan Supplement, (c) making all distributions and 

issuances as required under this Plan; and (d) entering into any transactions as set forth 

in the Plan Documents; (ii) the provisions of the Confirmation Order and this Plan are 

nonseverable and mutually dependent; (iii) the implementation of this Plan in 

accordance with its terms is authorized; (iv) pursuant to section 1146 of the Bankruptcy 

Code, the delivery of any deed or other instrument or transfer order, in furtherance of, 

or in connection with this Plan, including any deeds, bills of sale, or assignments 

executed in connection with any disposition or transfer of Assets contemplated under 

this Plan, shall not be subject to any Stamp or Similar Tax; and (v) the vesting of the 

Claimant Trust Assets in the Claimant Trust and the Reorganized Debtor Assets in the 

Reorganized Debtor, in each case as of the Effective Date free and clear of liens and 

claims to the fullest extent permissible under applicable law pursuant to section 1141(c) 

of the Bankruptcy Code except with respect to such Liens, Claims, charges and other 

encumbrances that are specifically preserved under this Plan upon the Effective Date. 

x All documents and agreements necessary to implement this Plan, including without 

limitation, the Reorganized Limited Partnership Agreement, the Claimant Trust 

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001257

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46 

Agreement, and the New GP LLC Documents, in each case in form and substance 

reasonably acceptable to the Debtor and the Committee, shall have (a) been tendered 

for delivery, and (b) been effected by, executed by, or otherwise deemed binding upon, 

all Entities party thereto and shall be in full force and effect. All conditions precedent 

to such documents and agreements shall have been satisfied or waived pursuant to the 

terms of such documents or agreements. 

x All authorizations, consents, actions, documents, approvals (including any 

governmental approvals), certificates and agreements necessary to implement this Plan, 

including, without limitation, the Reorganized Limited Partnership Agreement, the 

Claimant Trust Agreement, and the New GP LLC Documents, shall have been 

obtained, effected or executed and delivered to the required parties and, to the extent 

required, filed with the applicable governmental units in accordance with applicable 

laws and any applicable waiting periods shall have expired without any action being 

taken or threatened by any competent authority that would restrain or prevent 

effectiveness or consummation of the Restructuring. 

x The Debtor shall have obtained applicable directors’ and officers’ insurance coverage 

that is acceptable to each of the Debtor, the Committee, the Claimant Trust Oversight 

Committee, the Claimant Trustee and the Litigation Trustee. 

x The Professional Fee Reserve shall be funded pursuant to this Plan in an amount 

determined by the Debtor in good faith. 

B. Waiver of Conditions 

The conditions to effectiveness of this Plan set forth in this ARTICLE VIII (other than that 

the Confirmation Order shall have been entered) may be waived in whole or in part by the Debtor 

(and, to the extent such condition requires the consent of the Committee, the consent of the 

Committee), without notice, leave or order of the Bankruptcy Court or any formal action other 

than proceeding to confirm or effectuate this Plan. The failure to satisfy or waive a condition to 

the Effective Date may be asserted by the Debtor regardless of the circumstances giving rise to the 

failure of such condition to be satisfied. The failure of the Debtor to exercise any of the foregoing 

rights will not be deemed a waiver of any other rights, and each right will be deemed an ongoing 

right that may be asserted at any time by the Debtor, the Reorganized Debtor, or the Claimant 

Trust, as applicable. 

C. Dissolution of the Committee 

On the Effective Date, the Committee will dissolve, and the members of the Committee 

and the Committee’s Professionals will cease to have any role arising from or relating to the 

Chapter 11 Case, except in connection with final fee applications of Professionals for services 

rendered prior to the Effective Date (including the right to object thereto). The Professionals 

retained by the Committee and the members thereof will not be entitled to assert any fee claims 

for any services rendered to the Committee or expenses incurred in the service of the Committee 

after the Effective Date, except for reasonable fees for services rendered, and actual and necessary 

costs incurred, in connection with any applications for allowance of Professional Fees pending on 

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Exhibit 1 Page 144 of 162

001258

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47 

the Effective Date or filed and served after the Effective Date pursuant to the Plan. Nothing in the 

Plan shall prohibit or limit the ability of the Debtor’s or Committee’s Professionals to represent 

either of the Trustees or to be compensated or reimbursed per the Plan and the Claimant Trust 

Agreement in connection with such representation. 

ARTICLE IX.

EXCULPATION, INJUNCTION AND RELATED PROVISIONS 

A. General 

Notwithstanding anything contained in the Plan to the contrary, the allowance, 

classification and treatment of all Allowed Claims and Equity Interests and their respective 

distributions and treatments under the Plan shall take into account the relative priority and rights 

of the Claims and the Equity Interests in each Class in connection with any contractual, legal and 

equitable subordination rights relating thereto whether arising under general principles of equitable 

subordination, section 510 of the Bankruptcy Code, or otherwise. 

B. Discharge of Claims 

To the fullest extent provided under section 1141(d)(1)(A) and other applicable provisions 

of the Bankruptcy Code, except as otherwise expressly provided by this Plan or the Confirmation 

Order, all consideration distributed under this Plan will be in exchange for, and in complete 

satisfaction, settlement, discharge, and release of, all Claims and Equity Interests of any kind or 

nature whatsoever against the Debtor or any of its Assets or properties, and regardless of whether 

any property will have been distributed or retained pursuant to this Plan on account of such Claims 

or Equity Interests. Except as otherwise expressly provided by this Plan or the Confirmation 

Order, upon the Effective Date, the Debtor and its Estate will be deemed discharged and released 

under and to the fullest extent provided under section 1141(d)(1)(A) and other applicable 

provisions of the Bankruptcy Code from any and all Claims and Equity Interests of any kind or 

nature whatsoever, including, but not limited to, demands and liabilities that arose before the 

Confirmation Date, and all debts of the kind specified in section 502(g), 502(h), or 502(i) of the 

Bankruptcy Code. 

C. Exculpation 

Subject in all respects to ARTICLE XII.D of this Plan, to the maximum extent permitted 

by applicable law, no Exculpated Party will have or incur, and each Exculpated Party is hereby 

exculpated from, any claim, obligation, suit, judgment, damage, demand, debt, right, Cause of 

Action, remedy, loss, and liability for conduct occurring on or after the Petition Date in connection 

with or arising out of (i) the filing and administration of the Chapter 11 Case; (ii) the negotiation 

and pursuit of the Disclosure Statement, the Plan, or the solicitation of votes for, or confirmation 

of, the Plan; (iii) the funding or consummation of the Plan (including the Plan Supplement) or any 

related agreements, instruments, or other documents, the solicitation of votes on the Plan, the offer, 

issuance, and Plan Distribution of any securities issued or to be issued pursuant to the Plan, 

including the Claimant Trust Interests, whether or not such Plan Distributions occur following the 

Effective Date; (iv) the implementation of the Plan; and (v) any negotiations, transactions, and 

documentation in connection with the foregoing clauses (i)-(iv); provided, however, the foregoing 

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Exhibit 1 Page 145 of 162

001259

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48 

will not apply to (a) any acts or omissions of an Exculpated Party arising out of or related to acts 

or omissions that constitute bad faith, fraud, gross negligence, criminal misconduct, or willful 

misconduct or (b) Strand or any Employee other than with respect to actions taken by such Entities 

from the date of appointment of the Independent Directors through the Effective Date. This 

exculpation shall be in addition to, and not in limitation of, all other releases, indemnities, 

exculpations, any other applicable law or rules, or any other provisions of this Plan, including 

ARTICLE IV.C.2, protecting such Exculpated Parties from liability. 

D. Releases by the Debtor 

On and after the Effective Date, each Released Party is deemed to be, hereby conclusively, 

absolutely, unconditionally, irrevocably, and forever released and discharged by the Debtor and 

the Estate, in each case on behalf of themselves and their respective successors, assigns, and 

representatives, including, but not limited to, the Claimant Trust and the Litigation Sub-Trust from 

any and all Causes of Action, including any derivative claims, asserted on behalf of the Debtor, 

whether known or unknown, foreseen or unforeseen, matured or unmatured, existing or hereafter 

arising, in law, equity, contract, tort or otherwise, that the Debtor or the Estate would have been 

legally entitled to assert in their own right (whether individually or collectively) or on behalf of 

the holder of any Claim against, or Interest in, a Debtor or other Person. 

Notwithstanding anything contained herein to the contrary, the foregoing release does not 

release: (i) any obligations of any party under the Plan or any document, instrument, or agreement 

executed to implement the Plan, (ii) the rights or obligations of any current employee of the Debtor 

under any employment agreement or plan, (iii) the rights of the Debtor with respect to any 

confidentiality provisions or covenants restricting competition in favor of the Debtor under any 

employment agreement with a current or former employee of the Debtor, (iv) any Avoidance 

Actions, or (v) any Causes of Action arising from willful misconduct, criminal misconduct, actual 

fraud, or gross negligence of such applicable Released Party as determined by Final Order of the 

Bankruptcy Court or any other court of competent jurisdiction. 

Notwithstanding anything herein to the contrary, any release provided pursuant to this 

ARTICLE IX.D (i) with respect to a Senior Employee, is conditioned in all respects on (a) such 

Senior Employee executing a Senior Employee Stipulation on or prior to the Effective Date and 

(b) the reduction of such Senior Employee’s Allowed Claim as set forth in the Senior Employee 

Stipulation (such amount, the “Reduced Employee Claim”), and (ii) with respect to any Employee, 

including a Senior Employee, shall be deemed null and void and of no force and effect (1) if there 

is more than one member of the Claimant Trust Oversight Committee who does not represent 

entities holding a Disputed or Allowed Claim (the “Independent Members”), the Claimant Trustee 

and the Independent Members by majority vote determine or (2) if there is only one Independent 

Member, the Independent Member after discussion with the Claimant Trustee, determines (in each 

case after discussing with the full Claimant Trust Oversight Committee) that such Employee 

(regardless of whether the Employee is then currently employed by the Debtor, the Reorganized 

Debtor, or the Claimant Trustee): 

x sues, attempts to sue, or threatens or works with or assists any entity or person to sue, 

attempt to sue, or threaten the Reorganized Debtor, the Claimant Trust, the Litigation 

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Exhibit 1 Page 146 of 162

001260

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Sub-Trust, or any of their respective employees or agents, or any Released Party on or 

in connection with any claim or cause of action arising prior to the Effective Date, 

x has taken any action that, impairs or harms the value of the Claimant Trust Assets or 

the Reorganized Debtor Assets, or 

x (x) upon the request of the Claimant Trustee, has failed to provide reasonable assistance 

in good faith to the Claimant Trustee or the Reorganized Debtor with respect to (1) the 

monetization of the Claimant Trust Assets or Reorganized Debtor Assets, as applicable, 

or (2) the resolution of Claims, or (y) has taken any action that impedes or frustrates 

the Claimant Trustee or the Reorganized Debtor with respect to any of the foregoing. 

Provided, however, that the release provided pursuant to this ARTICLE IX.D will vest and the 

Employee will be indefeasibly released pursuant to this ARTICLE IX.D if such Employee’s 

release has not been deemed null and void and of no force and effect on or prior to the date that is 

the date of dissolution of the Claimant Trust pursuant to the Claimant Trust Agreement. 

By executing the Senior Employee Stipulation embodying this release, each Senior 

Employee acknowledges and agrees, without limitation, to the terms of this release and the tolling 

agreement contained in the Senior Employee Stipulation. 

The provisions of this release and the execution of a Senior Employee Stipulation will not 

in any way prevent or limit any Employee from (i) prosecuting its Claims, if any, against the 

Debtor’s Estate, (ii) defending him or herself against any claims or causes of action brought against 

the Employee by a third party, or (iii) assisting other persons in defending themselves from any 

Estate Claims brought by the Litigation Trustee (but only with respect to Estate Claims brought 

by the Litigation Trustee and not collection or other actions brought by the Claimant Trustee). 

E. Preservation of Rights of Action 

1. Maintenance of Causes of Action 

Except as otherwise provided in this Plan, after the Effective Date, the Reorganized Debtor 

or the Claimant Trust will retain all rights to commence, pursue, litigate or settle, as appropriate, 

any and all Causes of Action included in the Reorganized Debtor Assets or Claimant Trust Assets, 

as applicable, whether existing as of the Petition Date or thereafter arising, in any court or other 

tribunal including, without limitation, in an adversary proceeding Filed in the Chapter 11 Case 

and, as the successors in interest to the Debtor and the Estate, may, and will have the exclusive 

right to, enforce, sue on, settle, compromise, transfer or assign (or decline to do any of the 

foregoing) any or all of the Causes of Action without notice to or approval from the Bankruptcy 

Court. 

2. Preservation of All Causes of Action Not Expressly Settled or Released 

Unless a Cause of Action against a Holder of a Claim or an Equity Interest or other Entity 

is expressly waived, relinquished, released, compromised or settled in this Plan or any Final Order 

(including, without limitation, the Confirmation Order), such Cause of Action is expressly reserved 

for later adjudication by the Reorganized Debtor or Claimant Trust, as applicable (including, 

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001261

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50 

without limitation, Causes of Action not specifically identified or of which the Debtor may 

presently be unaware or that may arise or exist by reason of additional facts or circumstances 

unknown to the Debtor at this time or facts or circumstances that may change or be different from 

those the Debtor now believes to exist) and, therefore, no preclusion doctrine, including, without 

limitation, the doctrines of res judicata, collateral estoppel, issue preclusion, claim preclusion, 

waiver, estoppel (judicial, equitable or otherwise) or laches will apply to such Causes of Action as 

a consequence of the confirmation, effectiveness, or consummation of this Plan based on the 

Disclosure Statement, this Plan or the Confirmation Order, except where such Causes of Action 

have been expressly released in this Plan or any other Final Order (including, without limitation, 

the Confirmation Order). In addition, the right of the Reorganized Debtor or the Claimant Trust 

to pursue or adopt any claims alleged in any lawsuit in which the Debtor is a plaintiff, defendant 

or an interested party, against any Entity, including, without limitation, the plaintiffs or codefendants in such lawsuits, is expressly reserved. 

F. Injunction 

Upon entry of the Confirmation Order, all Enjoined Parties are and shall be 

permanently enjoined, on and after the Effective Date, from taking any actions to interfere 

with the implementation or consummation of the Plan. 

Except as expressly provided in the Plan, the Confirmation Order, or a separate order 

of the Bankruptcy Court, all Enjoined Parties are and shall be permanently enjoined, on and 

after the Effective Date, with respect to any Claims and Equity Interests, from directly or 

indirectly (i) commencing, conducting, or continuing in any manner any suit, action, or other 

proceeding of any kind (including any proceeding in a judicial, arbitral, administrative or 

other forum) against or affecting the Debtor or the property of the Debtor, (ii) enforcing, 

levying, attaching (including any prejudgment attachment), collecting, or otherwise 

recovering, enforcing, or attempting to recover or enforce, by any manner or means, any 

judgment, award, decree, or order against the Debtor or the property of the Debtor, (iii) 

creating, perfecting, or otherwise enforcing in any manner, any security interest, lien or 

encumbrance of any kind against the Debtor or the property of the Debtor, (iv) asserting any 

right of setoff, directly or indirectly, against any obligation due to the Debtor or against 

property or interests in property of the Debtor, except to the limited extent permitted under 

Sections 553 and 1141 of the Bankruptcy Code, and (v) acting or proceeding in any manner, 

in any place whatsoever, that does not conform to or comply with the provisions of the Plan. 

The injunctions set forth herein shall extend to, and apply to any act of the type set 

forth in any of clauses (i)-(v) of the immediately preceding paragraph against any successors 

of the Debtor, including, but not limited to, the Reorganized Debtor, the Litigation SubTrust, and the Claimant Trust and their respective property and interests in property. 

Subject in all respects to ARTICLE XII.D, no Enjoined Party may commence or 

pursue a claim or cause of action of any kind against any Protected Party that arose or arises 

from or is related to the Chapter 11 Case, the negotiation of the Plan, the administration of 

the Plan or property to be distributed under the Plan, the wind down of the business of the 

Debtor or Reorganized Debtor, the administration of the Claimant Trust or the Litigation 

Sub-Trust, or the transactions in furtherance of the foregoing without the Bankruptcy Court 

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001262

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(i) first determining, after notice and a hearing, that such claim or cause of action represents 

a colorable claim of any kind, including, but not limited to, negligence, bad faith, criminal 

misconduct, willful misconduct, fraud, or gross negligence against a Protected Party and (ii) 

specifically authorizing such Enjoined Party to bring such claim or cause of action against 

any such Protected Party; provided, however, the foregoing will not apply to a claim or cause 

of action against Strand or against any Employee other than with respect to actions taken, 

respectively, by Strand or by such Employee from the date of appointment of the 

Independent Directors through the Effective Date. The Bankruptcy Court will have sole and 

exclusive jurisdiction to determine whether a claim or cause of action is colorable and, only 

to the extent legally permissible and as provided for in ARTICLE XI, shall have jurisdiction 

to adjudicate the underlying colorable claim or cause of action. 

G. Duration of Injunctions and Stays 

ARTICLE II. Unless otherwise provided in this Plan, in the Confirmation Order, or 

in a Final Order of the Bankruptcy Court, (i) all injunctions and stays entered during the 

Chapter 11 Case and in existence on the Confirmation Date shall remain in full force and 

effect in accordance with their terms; and (ii) the automatic stay arising under section 362 

of the Bankruptcy Code shall remain in full force and effect subject to Section 362(c) of the 

Bankruptcy Code, and to the extent necessary if the Debtor does not receive a discharge, the 

Court will enter an equivalent order under Section 105. 

H. Continuance of January 9 Order 

Unless otherwise provided in this Plan, in the Confirmation Order, or in a Final Order of 

the Bankruptcy Court, the restrictions set forth in paragraphs 9 and 10 of the Order Approving 

Settlement with Official Committee of Unsecured Creditors Regarding Governance of the Debtor 

and Procedures for Operations in the Ordinary Course, entered by the Bankruptcy Court on 

January 9, 2020 [D.I. 339] shall remain in full force and effect following the Effective Date. 

ARTICLE X.

BINDING NATURE OF PLAN 

On the Effective Date, and effective as of the Effective Date, the Plan, including, without 

limitation, the provisions in ARTICLE IX, will bind, and will be deemed binding upon, all Holders 

of Claims against and Equity Interests in the Debtor and such Holder’s respective successors and 

assigns, to the maximum extent permitted by applicable law, notwithstanding whether or not such 

Holder will receive or retain any property or interest in property under the Plan. All Claims and 

Debts shall be fixed and adjusted pursuant to this Plan. The Plan shall also bind any taxing 

authority, recorder of deeds, or similar official for any county, state, Governmental Unit or parish 

in which any instrument related to the Plan or related to any transaction contemplated thereby is 

to be recorded with respect to nay taxes of the kind specified in Bankruptcy Code section 1146(a). 

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001263

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ARTICLE XI.

RETENTION OF JURISDICTION 

Pursuant to sections 105 and 1142 of the Bankruptcy Code and notwithstanding the entry 

of the Confirmation Order and the occurrence of the Effective Date, the Bankruptcy Court shall, 

after the Effective Date, retain such jurisdiction over the Chapter 11 Case and all Entities with 

respect to all matters related to the Chapter 11 Case, the Reorganized Debtor, the Claimant Trust, 

and this Plan to the maximum extent legally permissible, including, without limitation, jurisdiction 

to: 

x allow, disallow, determine, liquidate, classify, estimate or establish the priority, 

secured, unsecured, or subordinated status of any Claim or Equity Interest, including, 

without limitation, the resolution of any request for payment of any Administrative 

Expense Claim and the resolution of any and all objections to the allowance or priority 

of any Claim or Equity Interest; 

x grant or deny any applications for allowance of compensation or reimbursement of 

expenses authorized pursuant to the Bankruptcy Code or this Plan, for periods ending 

on or before the Effective Date; provided, however, that, from and after the Effective 

Date, the Reorganized Debtor shall pay Professionals in the ordinary course of business 

for any work performed after the Effective Date subject to the terms of this Plan and 

the Confirmation Order, and such payment shall not be subject to the approval of the 

Bankruptcy Court; 

x resolve any matters related to the assumption, assignment or rejection of any Executory 

Contract or Unexpired Lease to which the Debtor is party or with respect to which the 

Debtor, Reorganized Debtor, or Claimant Trust may be liable and to adjudicate and, if 

necessary, liquidate, any Claims arising therefrom, including, without limitation, any 

dispute regarding whether a contract or lease is or was executory or expired; 

x make any determination with respect to a claim or cause of action against a Protected 

Party as set forth in ARTICLE IX; 

x resolve any claim or cause of action against an Exculpated Party or Protected Party 

arising from or related to the Chapter 11 Case, the negotiation of this Plan, the 

administration of the Plan or property to be distributed under the Plan, the wind down 

of the business of the Debtor or Reorganized Debtor, or the transactions in furtherance 

of the foregoing; 

x if requested by the Reorganized Debtor or the Claimant Trustee, authorize, approve, 

and allow any sale, disposition, assignment or other transfer of the Reorganized Debtor 

Assets or Claimant Trust Assets, including any break-up compensation or expense 

reimbursement that may be requested by a purchaser thereof; provided, however, that 

neither the Reorganized Debtor nor the Claimant Trustee shall be required to seek such 

authority or approval from the Bankruptcy Court unless otherwise specifically required 

by this Plan or the Confirmation Order; 

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001264

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x if requested by the Reorganized Debtor or the Claimant Trustee, authorize, approve, 

and allow any borrowing or the incurrence of indebtedness, whether secured or 

unsecured by the Reorganized Debtor or Claimant Trust; provided, however, that 

neither the Reorganized Debtor nor the Claimant Trustee shall be required to seek such 

authority or approval from the Bankruptcy Court unless otherwise specifically required 

by this Plan or the Confirmation Order; 

x resolve any issues related to any matters adjudicated in the Chapter 11 Case; 

x ensure that distributions to Holders of Allowed Claims and Allowed Equity Interests 

are accomplished pursuant to the provisions of this Plan; 

x decide or resolve any motions, adversary proceedings, contested or litigated matters 

and any other Causes of Action (including Estate Claims) that are pending as of the 

Effective Date or that may be commenced in the future, including approval of any 

settlements, compromises, or other resolutions as may be requested by the Debtor, the 

Reorganized Debtor, the Claimant Trustee, or the Litigation Trustee whether under 

Bankruptcy Rule 9019 or otherwise, and grant or deny any applications involving the 

Debtor that may be pending on the Effective Date or instituted by the Reorganized 

Debtor, the Claimant Trustee, or Litigation Trustee after the Effective Date, provided 

that the Reorganized Debtor, the Claimant Trustee, and the Litigation Trustee shall 

reserve the right to commence actions in all appropriate forums and jurisdictions; 

x enter such orders as may be necessary or appropriate to implement, effectuate, or 

consummate the provisions of this Plan, the Plan Documents, and all other contracts, 

instruments, releases, and other agreements or documents adopted in connection with 

this Plan, the Plan Documents, or the Disclosure Statement; 

x resolve any cases, controversies, suits or disputes that may arise in connection with the 

implementation, effectiveness, consummation, interpretation, or enforcement of this 

Plan or any Entity’s obligations incurred in connection with this Plan; 

x issue injunctions and enforce them, enter and implement other orders or take such other 

actions as may be necessary or appropriate to restrain interference by any Entity with 

implementation, effectiveness, consummation, or enforcement of this Plan, except as 

otherwise provided in this Plan; 

x enforce the terms and conditions of this Plan and the Confirmation Order; 

x resolve any cases, controversies, suits or disputes with respect to the release, 

exculpation, indemnification, and other provisions contained herein and enter such 

orders or take such others actions as may be necessary or appropriate to implement or 

enforce all such releases, injunctions and other provisions; 

x enter and implement such orders or take such others actions as may be necessary or 

appropriate if the Confirmation Order is modified, stayed, reversed, revoked or 

vacated; 

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001265

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x resolve any other matters that may arise in connection with or relate to this Plan, the 

Disclosure Statement, the Confirmation Order, the Plan Documents, or any contract, 

instrument, release, indenture or other agreement or document adopted in connection 

with this Plan or the Disclosure Statement; and 

x enter an order concluding or closing the Chapter 11 Case after the Effective Date. 

ARTICLE XII.

MISCELLANEOUS PROVISIONS 

A. Payment of Statutory Fees and Filing of Reports 

All outstanding Statutory Fees shall be paid on the Effective Date. All such fees payable, 

and all such fees that become due and payable, after the Effective Date shall be paid by the 

Reorganized Debtor when due or as soon thereafter as practicable until the Chapter 11 Case is 

closed, converted, or dismissed. The Claimant Trustee shall File all quarterly reports due prior to 

the Effective Date when they become due, in a form reasonably acceptable to the U.S. Trustee. 

After the Effective Date, the Claimant Trustee shall File with the Bankruptcy Court quarterly 

reports when they become due, in a form reasonably acceptable to the U.S. Trustee. The 

Reorganized Debtor shall remain obligated to pay Statutory Fees to the Office of the U.S. Trustee 

until the earliest of the Debtor’s case being closed, dismissed, or converted to a case under chapter 

7 of the Bankruptcy Code. 

B. Modification of Plan 

Effective as of the date hereof and subject to the limitations and rights contained in this 

Plan: (a) the Debtor reserves the right, in accordance with the Bankruptcy Code and the 

Bankruptcy Rules, to amend or modify this Plan prior to the entry of the Confirmation Order with 

the consent of the Committee, such consent not to be unreasonably withheld; and (b) after the entry 

of the Confirmation Order, the Debtor may, after notice and hearing and entry of an order of the 

Bankruptcy Court, amend or modify this Plan, in accordance with section 1127(b) of the 

Bankruptcy Code or remedy any defect or omission or reconcile any inconsistency in this Plan in 

such manner as may be necessary to carry out the purpose and intent of this Plan. 

C. Revocation of Plan 

The Debtor reserves the right to revoke or withdraw this Plan prior to the Confirmation 

Date and to File a subsequent chapter 11 plan with the consent of the Committee. If the Debtor 

revokes or withdraws this Plan prior to the Confirmation Date, then: (i) this Plan shall be null and 

void in all respects; (ii) any settlement or compromise embodied in this Plan, assumption of 

Executory Contracts or Unexpired Leases effected by this Plan and any document or agreement 

executed pursuant hereto shall be deemed null and void except as may be set forth in a separate 

order entered by the Bankruptcy Court; and (iii) nothing contained in this Plan shall: (a) constitute 

a waiver or release of any Claims by or against, or any Equity Interests in, the Debtor or any other 

Entity; (b) prejudice in any manner the rights of the Debtor or any other Entity; or (c) constitute 

an admission, acknowledgement, offer or undertaking of any sort by the Debtor or any other Entity. 

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001266

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D. Obligations Not Changed 

Notwithstanding anything in this Plan to the contrary, nothing herein will affect or 

otherwise limit or release any non-Debtor Entity’s (including any Exculpated Party’s) duties or 

obligations, including any contractual and indemnification obligations, to the Debtor, the 

Reorganized Debtor, or any other Entity whether arising under contract, statute, or otherwise. 

E. Entire Agreement

Except as otherwise described herein, this Plan supersedes all previous and 

contemporaneous negotiations, promises, covenants, agreements, understandings, and 

representations on such subjects, all of which have become merged and integrated into this Plan. 

F. Closing of Chapter 11 Case

The Claimant Trustee shall, after the Effective Date and promptly after the full 

administration of the Chapter 11 Case, File with the Bankruptcy Court all documents required by 

Bankruptcy Rule 3022 and any applicable order of the Bankruptcy Court to close the Chapter 11 

Case. 

G. Successors and Assigns 

This Plan shall be binding upon and inure to the benefit of the Debtor and its successors 

and assigns, including, without limitation, the Reorganized Debtor and the Claimant Trustee. The 

rights, benefits, and obligations of any Person or Entity named or referred to in this Plan shall be 

binding on, and shall inure to the benefit of, any heir, executor, administrator, successor, or assign 

of such Person or Entity. 

H. Reservation of Rights 

Except as expressly set forth herein, this Plan shall have no force or effect unless and until 

the Bankruptcy Court enters the Confirmation Order and the Effective Date occurs. Neither the 

filing of this Plan, any statement or provision contained herein, nor the taking of any action by the 

Debtor, the Reorganized Debtor, the Claimant Trustee, or any other Entity with respect to this Plan 

shall be or shall be deemed to be an admission or waiver of any rights of: (1) the Debtor, the 

Reorganized Debtor, or the Claimant Trustee with respect to the Holders of Claims or Equity 

Interests or other Entity; or (2) any Holder of a Claim or an Equity Interest or other Entity prior to 

the Effective Date. 

Neither the exclusion or inclusion by the Debtor of any contract or lease on any exhibit, 

schedule, or other annex to this Plan or in the Plan Documents, nor anything contained in this Plan, 

will constitute an admission by the Debtor that any such contract or lease is or is not an executory 

contract or lease or that the Debtor, the Reorganized Debtor, the Claimant Trustee, or their 

respective Affiliates has any liability thereunder. 

Except as explicitly provided in this Plan, nothing herein shall waive, excuse, limit, 

diminish, or otherwise alter any of the defenses, claims, Causes of Action, or other rights of the 

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Appx. 0153

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Exhibit 1 Page 153 of 162

001267

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56 

Debtor, the Reorganized Debtor, or the Claimant Trustee under any executory or non-executory 

contract. 

Nothing in this Plan will increase, augment, or add to any of the duties, obligations, 

responsibilities, or liabilities of the Debtor, the Reorganized Debtor, or the Claimant Trustee, as 

applicable, under any executory or non-executory contract or lease. 

If there is a dispute regarding whether a contract or lease is or was executory at the time of 

its assumption under this Plan, the Debtor, the Reorganized Debtor, or the Claimant Trustee, as 

applicable, shall have thirty (30) days following entry of a Final Order resolving such dispute to 

alter their treatment of such contract. 

I. Further Assurances 

The Debtor, the Reorganized Debtor, or the Claimant Trustee, as applicable, all Holders of 

Claims and Equity Interests receiving distributions hereunder, and all other Entities shall, from 

time to time, prepare, execute and deliver any agreements or documents and take any other actions 

as may be necessary or advisable to effectuate the provisions and intent of this Plan or the 

Confirmation Order. On or before the Effective Date, the Debtor shall File with the Bankruptcy 

Court all agreements and other documents that may be necessary or appropriate to effectuate and 

further evidence the terms and conditions hereof. 

J. Severability 

If, prior to the Confirmation Date, any term or provision of this Plan is determined by the 

Bankruptcy Court to be invalid, void, or unenforceable, the Bankruptcy Court will have the power 

to alter and interpret such term or provision to make it valid or 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 will 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 will 

constitute a judicial determination and will 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. 

K. Service of Documents 

All notices, requests, and demands to or upon the Debtor, the Reorganized Debtor, or the 

Claimant Trustee to be effective shall be in writing and, unless otherwise expressly provided 

herein, shall be deemed to have been duly given or made when actually delivered addressed as 

follows: 

If to the Claimant Trust: 

Highland Claimant Trust 

c/o Highland Capital Management, L.P. 

300 Crescent Court, Suite 700 

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Exhibit 1 Page 154 of 162

001268

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57 

Dallas, Texas 75201 

Attention: James P. Seery, Jr. 

If to the Debtor: 

Highland Capital Management, L.P. 

300 Crescent Court, Suite 700 

Dallas, Texas 75201 

Attention: James P. Seery, Jr. 

with copies to: 

Pachulski Stang Ziehl & Jones LLP 

10100 Santa Monica Blvd., 13th Floor 

Los Angeles, CA 90067 

Telephone: (310) 277-6910 

Facsimile: (310) 201-0760 

Attn: Jeffrey N. Pomerantz, Esq. 

 Ira D. Kharasch, Esq. 

 Gregory V. Demo, Esq. 

If to the Reorganized Debtor: 

Highland Capital Management, L.P. 

300 Crescent Court, Suite 700 

Dallas, Texas 75201 

Attention: James P. Seery, Jr. 

with copies to: 

Pachulski Stang Ziehl & Jones LLP 

10100 Santa Monica Blvd., 13th Floor 

Los Angeles, CA 90067 

Attn: Jeffrey N. Pomerantz, Esq. 

 Ira D. Kharasch, Esq. 

 Gregory V. Demo, Esq. 

L. Exemption from Certain Transfer Taxes Pursuant to Section 1146(a) of the 

Bankruptcy Code 

To the extent permitted by applicable law, pursuant to section 1146(a) of the Bankruptcy 

Code, any transfers of property pursuant hereto shall not be subject to any Stamp or Similar Tax 

or governmental assessment in the United States, and the Confirmation Order shall direct the 

appropriate federal, state or local governmental officials or agents or taxing authority to forego the 

collection of any such Stamp or Similar Tax or governmental assessment and to accept for filing 

and recordation instruments or other documents pursuant to such transfers of property without the 

payment of any such Stamp or Similar Tax or governmental assessment. Such exemption 

specifically applies, without limitation, to (i) all actions, agreements and documents necessary to 

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Appx. 0155

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Exhibit 1 Page 155 of 162

001269

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58 

evidence and implement the provisions of and the distributions to be made under this Plan; (ii) the 

maintenance or creation of security or any Lien as contemplated by this Plan; and (iii) assignments, 

sales, or transfers executed in connection with any transaction occurring under this Plan. 

M. Governing Law 

Except to the extent that the Bankruptcy Code, the Bankruptcy Rules or other federal 

law is applicable, or to the extent that an exhibit or schedule to this 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 Texas, without giving effect to the principles of conflicts of law 

of such jurisdiction; provided, however, that corporate governance matters relating to the 

Debtor, the Reorganized Debtor, New GP LLC, or the Claimant Trust, as applicable, shall be 

governed by the laws of the state of organization of the Debtor, the Reorganized Debtor, New 

GP LLC, or the Claimant Trustee, as applicable. 

N. Tax Reporting and Compliance 

The Debtor is hereby authorized to request an expedited determination under 

section 505(b) of the Bankruptcy Code of the tax liability of the Debtor is for all taxable periods 

ending after the Petition Date through, and including, the Effective Date. 

O. Exhibits and Schedules 

All exhibits and schedules to this Plan, if any, including the Exhibits and the Plan 

Documents, are incorporated and are a part of this Plan as if set forth in full herein. 

P. Controlling Document

In the event of an inconsistency between this Plan and any other instrument or document 

created or executed pursuant to this Plan, or between this Plan and the Disclosure Statement, this 

Plan shall control. The provisions of this Plan, the Disclosure Statement, and any Plan Document, 

on the one hand, and of the Confirmation Order, on the other hand, shall be construed in a manner 

consistent with each other so as to effectuate the purposes of each; provided, however, that if there 

is determined to be any inconsistency between any provision of this Plan, the Disclosure 

Statement, and any Plan Document, on the one hand, and any provision of the Confirmation Order, 

on the other hand, that cannot be so reconciled, then, solely to the extent of such inconsistency, 

the provisions of the Confirmation Order shall govern, and any such provisions of the 

Confirmation Order shall be deemed a modification of this Plan, the Disclosure Statement, and the 

Plan Documents, as applicable. 

[Remainder of Page Intentionally Blank]

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Exhibit 1 Page 156 of 162

001270

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DOCS_NY:40509.39 36027/002

Dated: January 22, 2021

Respectfully submitted,

HIGHLAND CAPITAL MANAGEMENT, L.P. 

By:

James P. Seery, Jr.

Chief Executive Officer and Chief Restructuring

Officer

Prepared by: 

PACHULSKI STANG ZIEHL & JONES LLP

Jeffrey N. Pomerantz (CA Bar No.143717)

Ira D. Kharasch (CA Bar No. 109084)

Gregory V. Demo (NY Bar No. 5371992)

10100 Santa Monica Boulevard, 13th Floor

Los Angeles, CA 90067

Telephone: (310) 277-6910

Facsimile: (310) 201-0760

Email: jpomerantz@pszjlaw.com

ikharasch@pszjlaw.com

gdemo@pszjlaw.com

and 

HAYWARD & ASSOCIATES PLLC

Melissa S. Hayward (TX Bar No. 24044908)

Zachery Z. Annable (TX Bar No. 24053075)

10501 N. Central Expy, Ste. 106

Dallas, TX 75231

Telephone: (972) 755-7100

Facsimile: (972) 755-7110

Email: MHayward@HaywardFirm.com

ZAnnable@HaywardFirm.com

Counsel for the Debtor and Debtor-in-Possession

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Exhibit 1 Page 157 of 162

001271

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Exhibit B 

Schedule of CLO Management Agreements and Related Contracts to Be Assumed 

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Exhibit 1 Page 158 of 162

001272

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DOCS_NY:42355.1 36027/002

Schedule of CLO Management Agreements and Related Contracts to Be Assumed 

1. Servicing Agreement, dated December 20, 2007, by and among Greenbriar CLO, Ltd., 

and Highland Capital Management, L.P. 

2. Investment Management Agreement, dated November 1, 2007, by and between Longhorn 

Credit Funding, LLC, and Highland Capital Management, L.P. (as amended) 

3. Reference Portfolio Management Agreement, dated August 1, 2016, by and between 

Highland Capital Management, L.P., and Valhalla CLO, Ltd. 

4. Collateral Servicing Agreement, dated December 20, 2006, by and among Highland Park 

CDO I, Ltd., and Highland Capital Management, L.P. 

5. Portfolio Management Agreement, dated March 15, 2005, by and among Southfork CLO 

Ltd., and Highland Capital Management, L.P. 

6. Amended and Restated Portfolio Management Agreement, dated November 30, 2005, by 

and among Jaspar CLO Ltd., and Highland Capital Management, L.P. 

7. Servicing Agreement, dated May 31, 2007, by and among Westchester CLO, Ltd., and 

Highland Capital Management, L.P. 

8. Servicing Agreement, dated May 10, 2006, by and among Rockwall CDO Ltd. and 

Highland Capital Management, L.P. (as amended) 

9. Portfolio Management Agreement, dated December 8, 2005, by and between Liberty 

CLO, Ltd., and Highland Capital Management, L.P. 

10. Servicing Agreement, dated March 27, 2008, by and among Aberdeen Loan Funding, 

Ltd., and Highland Capital Management, L.P. 

11. Servicing Agreement, dated May 9, 2007, by and among Rockwall CDO II Ltd. and 

Highland Capital Management, L.P. 

12. Collateral Management Agreement, by and between, Highland Loan Funding V Ltd. and 

Highland Capital Management, L.P., dated August 1, 2001. 

13. Collateral Management Agreement, dated August 18, 1999, by and between Highland 

Legacy Limited and Highland Capital Management, L.P. 

14. Servicing Agreement, dated November 30, 2006, by and among Grayson CLO Ltd., and 

Highland Capital Management, L.P. (as amended) 

15. Servicing Agreement, dated October 25, 2007, by and among Stratford CLO Ltd., and 

Highland Capital Management, L.P. 

16. Servicing Agreement, dated August 3, 2006, by and among Red River CLO Ltd., and 

Highland Capital Management, L.P. (as amended) 

17. Servicing Agreement, dated December 21, 2006, by and among Brentwood CLO, Ltd., 

and Highland Capital Management, L.P. 

18. Servicing Agreement, dated March 13, 2007, by and among Eastland CLO Ltd., and 

Highland Capital Management, L.P. 

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Exhibit 1 Page 159 of 162

001273

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 2 

DOCS_NY:42355.1 36027/002

19. Portfolio Management, Agreement, dated October 13, 2005, by and among Gleneagles 

CLO, Ltd., and Highland Capital Management, L.P. 

20. Members’ Agreement and Amendment, dated November 15, 2017, by and between 

Highland CLO Funding, Ltd. and Highland Capital Management, L.P. 

21. Collateral Management Agreement, dated May 19, 1998, by and between Pam Capital 

Funding LP, Ranger Asset Mgt LP and Highland Capital Management, L.P. 

22. Collateral Management Agreement, dated August 6, 1997, by and between Pamco 

Cayman Ltd., Ranger Asset Mgt LP and Highland Capital Management, L.P. 

23. Amendment No. 1 to Servicing Agreement, October 2, 2007, between Highland Capital 

Management, L.P. and Red River CLO Ltd. et al 

24. Interim Collateral Management Agreement, June 15, 2005, between Highland Capital 

Management, L.P. and Rockwall CDO Ltd 

25. Amendment No. 1 to Servicing Agreement, October 2, 2007, between Highland Capital 

Management, L.P. and Rockwall CDO Ltd 

26. Collateral Servicing Agreement dated December 20, 2006, between Highland Capital 

Management, L.P. and Highland Park CDO I, Ltd.; The Bank of New York Trust 

Company, National Association 

27. Representations and Warranties Agreement, dated December 20, 2006, between Highland 

Capital Management, L.P. and Highland Park CDO I, Ltd. 

28. Collateral Administration Agreement, dated March 27, 2008, between Highland Capital 

Management, L.P. and Aberdeen Loan Funding, Ltd.; State Street Bank and Trust 

Company 

29. Collateral Administration Agreement, dated December 20, 2007, between Highland 

Capital Management, L.P. and Greenbriar CLO, Ltd.; State Street Bank and Trust 

Company 

30. Collateral Acquisition Agreement, dated March 13, 2007, between Highland Capital 

Management, L.P. and Eastland CLO, Ltd 

31. Collateral Administration Agreement, dated March 13, 2007, between Highland Capital 

Management, L.P. and Eastland CLO, Ltd. and Investors Bank and Trust Company 

32. Collateral Administration Agreement, dated October 13, 2005, between Highland Capital 

Management, L.P. and Gleneagles CLO, Ltd.; JPMorgan Chase Bank, National 

Association 

33. Collateral Acquisition Agreement, dated November 30, 2006, between Highland Capital 

Management, L.P. and Grayson CLO, Ltd. 

34. Collateral Administration Agreement, dated November 30, 2006, between Highland 

Capital Management, L.P. and Grayson CLO, Ltd.; Investors Bank & Trust Company 

35. Collateral Acquisition Agreement, dated August 3, 2006, between Highland Capital 

Management, L.P. and Red River CLO, Ltd. 

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Exhibit 1 Page 160 of 162

001274

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 3 

DOCS_NY:42355.1 36027/002

36. Collateral Administration Agreement, dated August 3, 2006, between Highland Capital 

Management, L.P. and Red River CLO, Ltd.; U.S. Bank National Association 

37. Master Warehousing and Participation Agreement, dated April 19, 2006, between 

Highland Capital Management, L.P. and Red River CLO Ltd.; Highland Special 

Opportunities Holding Company 

38. Master Warehousing and Participation Agreement, dated February 2, 2006, between 

Highland Capital Management, L.P. and Red River CLO Ltd.; MMP-5 Funding, LLC; 

IXIS Financial Products Inc. 

39. Master Warehousing and Participation Agreement (Amendment No. 2), dated May 5, 

2006, between Highland Capital Management, L.P. and Red River CLO Ltd.; MMP-5 

Funding, LLC; IXIS Financial Products Inc. 

40. Master Warehousing and Participation Agreement (Amendment No. 1), dated April 12, 

2006, between Highland Capital Management, L.P. and Red River CLO Ltd.; MMP-5 

Funding, LLC; IXIS Financial Products Inc. 

41. Master Warehousing and Participation Agreement (Amendment No. 3), dated June 22, 

2006, between Highland Capital Management, L.P. and Red River CLO Ltd.; MMP-5 

Funding, LLC; IXIS Financial Products Inc. 

42. Master Warehousing and Participation Agreement (Amendment No. 4), dated July 17, 

2006, between Highland Capital Management, L.P. and Red River CLO Ltd.; MMP-5 

Funding, LLC; IXIS Financial Products Inc. 

43. Collateral Administration Agreement, dated February 2, 2006, between Highland Capital 

Management, L.P. and Red River CLO Ltd.; U.S. Bank National Association; IXIS 

Financial Products Inc. 

44. Collateral Administration Agreement, dated April 18, 2006, between Highland Capital 

Management, L.P. and Red River CLO Ltd.; Highland Special Opportunities Holding 

Company; U.S. Bank National Association 

45. Master Participation Agreement, dated June 5, 2006, between Highland Capital 

Management, L.P. and Red River CLO Ltd.; Grand Central Asset Trust 

46. A&R Asset Acquisition Agreement, dated July 18, 2001, between Highland Capital 

Management, L.P. and Salomon Smith Barney Inc.; Highland Loan Funding V Ltd. 

47. A&R Master Participation Agreement, dated July 18, 2001, between Highland Capital 

Management, L.P. and Salomon Brothers Holding Company; Highland Loan Funding V 

Ltd. 

48. Collateral Acquisition Agreement, dated June 29, 2005, between Highland Capital 

Management, L.P. and Jasper CLO Ltd. 

49. Collateral Administration Agreement, dated June 29, 2005, between Highland Capital 

Management, L.P. and Jasper CLO Ltd.; JPMorgan Chase Bank, National Association 

50. Master Warehousing and Participation Agreement, dated March 24, 2005, between 

Highland Capital Management, L.P. and Jasper CLO Ltd; MMP-5 Funding, LLC; and 

IXIS Financial Products Inc. 

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Exhibit 1 Page 161 of 162

001275

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 4 

DOCS_NY:42355.1 36027/002

51. Master Warehousing and Participation Agreement (Amendment No. 1), dated May 16, 

2005, between Highland Capital Management, L.P. and Jasper CLO Ltd; MMP-5 

Funding, LLC; and IXIS Financial Products Inc. 

52. Collateral Administration Agreement, dated December 8, 2005, between Highland 

Capital Management, L.P. and Liberty CLO Ltd. 

53. Collateral Administration Agreement, dated May 10, 2006, between Highland Capital 

Management, L.P. and Rockwall CDO Ltd; JPMorgan Chase Bank, National Association 

54. Collateral Administration Agreement, dated May 9, 2007, between Highland Capital 

Management, L.P. and Rockwall CDO II, Ltd.; Investors Bank & Trust Company 

55. Collateral Administration Agreement, dated March 15, 2005, between Highland Capital 

Management, L.P. and Southfork CLO Ltd.; JPMorgan Chase Bank, National 

Association 

56. Collateral Administration Agreement, dated October 25, 2007, between Highland Capital 

Management, L.P. and Stratford CLO Ltd.; State Street 

57. Collateral Administration Agreement, dated August 18, 2004, between Highland Capital 

Management, L.P. and Valhalla CLO, Ltd.; JPMorgan Chase Bank 

58. Collateral Acquisition Agreement, dated May 31, 2007, between Highland Capital 

Management, L.P. and Westchester CLO, Ltd. 

59. Collateral Administration Agreement, dated May 31, 2007, between Highland Capital 

Management, L.P. and Westchester CLO, Ltd.; Investors Bank & Trust Company 

60. Collateral Administration Agreement, dated December 21, 2006, between Highland 

Capital Management, L.P. and Brentwood CLO, Ltd.; Investors Bank & Trust Company 

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Exhibit 1 Page 162 of 162

001276

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EXHIBIT 

Appx. 0163

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001277

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-1-

IN THE UNITED STATES BANKRUPTCY COURT

FOR THE NORTHERN DISTRICT OF TEXAS

DALLAS DIVISION

In re:

HIGHLAND CAPITAL MANAGEMENT, L.P.,1

Debtor. 

)

) 

) 

) 

) 

) 

)

Chapter 11 

Case No. 19-34054-sgj11

FIFTH AMENDED PLAN OF REORGANIZATION OF HIGHLAND 

CAPITAL MANAGEMENT, L.P. (AS MODIFIED)

PACHULSKI STANG ZIEHL & JONES LLP

Jeffrey N. Pomerantz (CA Bar No.143717) 

Ira D. Kharasch (CA Bar No. 109084) 

Gregory V. Demo (NY Bar No. 5371992) 

10100 Santa Monica Boulevard, 13th Floor 

Los Angeles, CA 90067 

Telephone: (310) 277-6910 

Facsimile: (310) 201-0760 

Email: jpomerantz@pszjlaw.com 

 ikharasch@pszjlaw.com 

gdemo@pszjlaw.com

HAYWARD & ASSOCIATES PLLC

Melissa S. Hayward (TX Bar No. 24044908) 

Zachery Z. Annable (TX Bar No. 24053075)

10501 N. Central Expy, Ste. 106 

Dallas, TX 75231 

Telephone: (972) 755-7100 

Facsimile: (972) 755-7110 

Email: MHayward@HaywardFirm.com

 ZAnnable@HaywardFirm.com: 

Counsel for the Debtor and Debtor-in-Possession

1 The Debtor’s last four digits of its taxpayer identification number are (6725). The headquarters and service 

address for the above-captioned Debtor is 300 Crescent Court, Suite 700, Dallas, TX 75201.

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 ̈1¤}HV5!6 -l«

1934054210122000000000013

Docket #1808 Date Filed: 01/22/2021

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Exhibit 2 Page 2 of 67

001278

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- ii -

ARTICLE I. RULES OF INTERPRETATION, COMPUTATION OF TIME, 

GOVERNING LAW AND DEFINED TERMS .............................................. 1

A. Rules of Interpretation, Computation of Time and Governing Law ..................... 1

B. Defined Terms ...................................................................................................... 2

ARTICLE II. ADMINISTRATIVE EXPENSES AND PRIORITY TAX CLAIMS.................16

A. Administrative Expense Claims .......................................................................... 16

B. Professional Fee Claims ...................................................................................... 17

C. Priority Tax Claims ............................................................................................. 18

ARTICLE III. CLASSIFICATION AND TREATMENT OF CLASSIFIED CLAIMS 

AND EQUITY INTERESTS ......................................................................... 18

A. Summary ............................................................................................................. 18

B. Summary of Classification and Treatment of Classified Claims and 

Equity Interests ................................................................................................... 19

C. Elimination of Vacant Classes ............................................................................ 19

D. Impaired/Voting Classes ..................................................................................... 19

E. Unimpaired/Non-Voting Classes ........................................................................ 19

F. Impaired/Non-Voting Classes ............................................................................. 19

G. Cramdown ........................................................................................................... 19

H. Classification and Treatment of Claims and Equity Interests ............................. 20

I. Special Provision Governing Unimpaired Claims .............................................. 24

J. Subordinated Claims ........................................................................................... 25

ARTICLE IV. MEANS FOR IMPLEMENTATION OF THIS PLAN ..................................... 25

A. Summary ............................................................................................................. 25

B. The Claimant Trust ............................................................................................. 26

1. Creation and Governance of the Claimant Trust and Litigation SubTrust. ................................................................................................................... 26

2. Claimant Trust Oversight Committee ................................................................. 27

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001279

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Page

- iii -

3. Purpose of the Claimant Trust. ........................................................................... 27

4. Purpose of the Litigation Sub-Trust. ................................................................... 28

5. Claimant Trust Agreement and Litigation Sub-Trust Agreement. ...................... 28

6. Compensation and Duties of Trustees. ............................................................... 29

7. Cooperation of Debtor and Reorganized Debtor. .............................................. 30

8. United States Federal Income Tax Treatment of the Claimant Trust. ................ 30

9. Tax Reporting......................................................................................................30

10. Claimant Trust Assets. ........................................................................................ 31

11. Claimant Trust Expenses. ................................................................................... 31

12. Trust Distributions to Claimant Trust Beneficiaries. ......................................... 31

13. Cash Investments. ............................................................................................... 31

14. Dissolution of the Claimant Trust and Litigation Sub-Trust. ............................. 32

C. The Reorganized Debtor ..................................................................................... 32

1. Corporate Existence............................................................................................32

2. Cancellation of Equity Interests and Release ..................................................... 33

3. Issuance of New Partnership Interests ............................................................... 33

4. Management of the Reorganized Debtor ............................................................ 33

5. Vesting of Assets in the Reorganized Debtor ...................................................... 34

6. Purpose of the Reorganized Debtor .................................................................... 34

7. Distribution of Proceeds from the Reorganized Debtor Assets; Transfer 

of Reorganized Debtor Assets ............................................................................. 34

D. Company Action ................................................................................................. 34

E. Release of Liens, Claims and Equity Interests....................................................35

F. Cancellation of Notes, Certificates and Instruments........................................... 36

G. Cancellation of Existing Instruments Governing Security Interests ................... 36

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001280

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- iv -

H. Control Provisions .............................................................................................. 36

I. Treatment of Vacant Classes .............................................................................. 36

J. Plan Documents .................................................................................................. 36

K. Highland Capital Management, L.P. Retirement Plan and Trust ....................... 37

ARTICLE V. TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED 

LEASES ......................................................................................................... 37

A. Assumption, Assignment, or Rejection of Executory Contracts and 

Unexpired Leases ................................................................................................ 37

B. Claims Based on Rejection of Executory Contracts or Unexpired 

Leases .................................................................................................................. 38

C. Cure of Defaults for Assumed or Assigned Executory Contracts and 

Unexpired Leases ................................................................................................ 39

ARTICLE VI. PROVISIONS GOVERNING DISTRIBUTIONS ............................................. 39

A. Dates of Distributions ......................................................................................... 39

B. Distribution Agent .............................................................................................. 40

C. Cash Distributions ............................................................................................... 41

D. Disputed Claims Reserve .................................................................................... 41

E. Distributions from the Disputed Claims Reserve ............................................... 41

F. Rounding of Payments ........................................................................................ 41

G. De Minimis Distribution ..................................................................................... 41

H. Distributions on Account of Allowed Claims ..................................................... 42

I. General Distribution Procedures ......................................................................... 42

J. Address for Delivery of Distributions................................................................. 42

K. Undeliverable Distributions and Unclaimed Property ........................................ 42

L. Withholding Taxes .............................................................................................. 43

M. Setoffs ................................................................................................................. 43

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001281

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-vN. Surrender of Cancelled Instruments or Securities .............................................. 43

O. Lost, Stolen, Mutilated or Destroyed Securities ................................................. 43

ARTICLE VII. PROCEDURES FOR RESOLVING CONTINGENT, 

UNLIQUIDATED AND DISPUTED CLAIMS ............................................ 44

A. Filing of Proofs of Claim .................................................................................... 44

B. Disputed Claims .................................................................................................. 44

C. Procedures Regarding Disputed Claims or Disputed Equity Interests ............... 44

D. Allowance of Claims and Equity Interests .......................................................... 44

1. Allowance of Claims ........................................................................................... 45

2. Estimation ........................................................................................................... 45

3. Disallowance of Claims ...................................................................................... 45

ARTICLE VIII. EFFECTIVENESS OF THIS PLAN ............................................................... 46

A. Conditions Precedent to the Effective Date ........................................................ 46

B. Waiver of Conditions .......................................................................................... 47

C. Effect of Non-Occurrence of Conditions to EffectivenessError! Bookmark not defined.

D. Dissolution of the Committee ............................................................................. 47

ARTICLE IX. EXCULPATION, INJUNCTION AND RELATED PROVISIONS ................. 48

A. General ................................................................................................................ 48

B. Discharge of Claims ............................................................................................ 48

C. Exculpation ......................................................................................................... 48

D. Releases by the Debtor........................................................................................49

E. Preservation of Rights of Action......................................................................... 50

1. Maintenance of Causes of Action ....................................................................... 50

2. Preservation of All Causes of Action Not Expressly Settled or Released ........... 50

F. Injunction ............................................................................................................ 51

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001282

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- vi -

G. Term of Injunctions or Stays............................................................................... 52

H. Continuance of January 9 Order ......................................................................... 52

ARTICLE X. BINDING NATURE OF PLAN .......................................................................... 52

ARTICLE XI. RETENTION OF JURISDICTION .................................................................... 53

ARTICLE XII. MISCELLANEOUS PROVISIONS ................................................................. 55

A. Payment of Statutory Fees and Filing of Reports ............................................... 55

B. Modification of Plan ........................................................................................... 55

C. Revocation of Plan .............................................................................................. 55

D. Obligations Not Changed .................................................................................... 56

E. Entire Agreement ................................................................................................ 56

F. Closing of Chapter 11 Case ................................................................................ 56

G. Successors and Assigns....................................................................................... 56

H. Reservation of Rights .......................................................................................... 56

I. Further Assurances..............................................................................................57

J. Severability ......................................................................................................... 57

K. Service of Documents ......................................................................................... 57

L. Exemption from Certain Transfer Taxes Pursuant to Section 1146(a) of 

the Bankruptcy Code........................................................................................... 58

M. Governing Law ................................................................................................... 59

N. Tax Reporting and Compliance .......................................................................... 59

O. Exhibits and Schedules ....................................................................................... 59

P. Controlling Document ........................................................................................ 59

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001283

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DEBTOR’S CHAPTER 11 PLAN OF REORGANIZATION

HIGHLAND CAPITAL MANAGEMENT, L.P., as debtor and debtor-in-possession in 

the above-captioned case (the “Debtor”), proposes the following chapter 11 plan of 

reorganization (the “Plan”) for, among other things, the resolution of the outstanding Claims 

against, and Equity Interests in, the Debtor. Unless otherwise noted, capitalized terms used in 

this Plan have the meanings set forth in Article I of this Plan. The Debtor is the proponent of this 

Plan within the meaning of section 1129 of the Bankruptcy Code. 

Reference is made to the Disclosure Statement (as such term is defined herein and 

distributed contemporaneously herewith) for a discussion of the Debtor’s history, business, 

results of operations, historical financial information, projections and assets, and for a summary 

and analysis of this Plan and the treatment provided for herein. There also are other agreements 

and documents that may be Filed with the Bankruptcy Court that are referenced in this Plan or 

the Disclosure Statement as Exhibits and Plan Documents. All such Exhibits and Plan 

Documents are incorporated into and are a part of this Plan as if set forth in full herein. Subject 

to the other provisions of this Plan, and in accordance with the requirements set forth in 

section 1127 of the Bankruptcy Code and Bankruptcy Rule 3019, the Debtor reserves the right to 

alter, amend, modify, revoke, or withdraw this Plan prior to the Effective Date. 

If this Plan cannot be confirmed, for any reason, then subject to the terms set forth herein, 

this Plan may be revoked. 

ARTICLE I.

RULES OF INTERPRETATION, COMPUTATION OF TIME, 

GOVERNING LAW AND DEFINED TERMS 

A. Rules of Interpretation, Computation of Time and Governing Law 

For purposes hereof: (a) in the appropriate context, each term, whether stated in the 

singular or the plural, shall include both the singular and the plural, and pronouns stated in the 

masculine, feminine or neuter gender shall include the masculine, feminine and the neuter 

gender; (b) any reference herein to a contract, lease, instrument, release, indenture or other 

agreement or document being in a particular form or on particular terms and conditions means 

that the referenced document, as previously amended, modified or supplemented, if applicable, 

shall be substantially in that form or substantially on those terms and conditions; (c) any 

reference herein to an existing document or exhibit having been Filed or to be Filed shall mean 

that document or exhibit, as it may thereafter be amended, modified or supplemented in 

accordance with its terms; (d) unless otherwise specified, all references herein to “Articles,” 

“Sections,” “Exhibits” and “Plan Documents” are references to Articles, Sections, Exhibits and 

Plan Documents hereof or hereto; (e) unless otherwise stated, the words “herein,” “hereof,” 

“hereunder” and “hereto” refer to this Plan in its entirety rather than to a particular portion of this 

Plan; (f) 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 hereof; (g) any reference to 

an Entity as a Holder of a Claim or Equity Interest includes such Entity’s successors and assigns; 

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001284

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2

(h) the rules of construction set forth in section 102 of the Bankruptcy Code shall apply; (i) any 

term used in capitalized form herein that is not otherwise defined but that is used in the 

Bankruptcy Code or the Bankruptcy Rules shall have the meaning assigned to that term in the 

Bankruptcy Code or the Bankruptcy Rules, as the case may be; and (j) “$” or “dollars” means 

Dollars in lawful currency of the United States of America. The provisions of Bankruptcy 

Rule 9006(a) shall apply in computing any period of time prescribed or allowed herein. 

B. Defined Terms

Unless the context otherwise requires, the following terms shall have the following 

meanings when used in capitalized form herein: 

1. “Acis” means collectively Acis Capital Management, L.P. and Acis Capital 

Management GP, LLP.

2. “Administrative Expense Claim” means any Claim for costs and expenses of 

administration of the Chapter 11 Case that is Allowed pursuant to sections 503(b), 507(a)(2), 

507(b) or 1114(2) of the Bankruptcy Code, including, without limitation, (a) the actual and 

necessary costs and expenses incurred after the Petition Date and through the Effective Date of 

preserving the Estate and operating the business of the Debtor; and (b) all fees and charges 

assessed against the Estate pursuant to sections 1911 through 1930 of chapter 123 of title 28 of 

the United States Code, and that have not already been paid by the Debtor during the Chapter 11 

Case and a Professional Fee Claim.

3. “Administrative Expense Claims Bar Date” means, with respect to any 

Administrative Expense Claim (other than a Professional Fee Claim) becoming due on or prior to 

the Effective Date, 5:00 p.m. (prevailing Central Time) on such date that is forty-five days after 

the Effective Date. 

4. “Administrative Expense Claims Objection Deadline” means, with respect to 

any Administrative Expense Claim, the later of (a) ninety (90) days after the Effective Date and 

(b) sixty (60) days after the timely Filing of the applicable request for payment of such 

Administrative Expense Claim; provided, however, that the Administrative Expense Claims 

Objection Deadline may be extended by the Bankruptcy Court upon a motion by the Claimant 

Trustee.

5. “Affiliate” of any Person means any Entity that, with respect to such Person, 

either (i) is an “affiliate” as defined in section 101(2) of the Bankruptcy Code, or (ii) is an 

“affiliate” as defined in Rule 405 of the Securities Act of 1933, or (iii) directly or indirectly, 

through one or more intermediaries, controls, is controlled by, or is under common control with, 

such Person. For the purposes of this definition, the term “control” (including, without 

limitation, the terms “controlled by” and “under common control with”) means the possession,

directly or indirectly, of the power to direct or cause the direction in any respect of the 

management or policies of a Person, whether through the ownership of voting securities, by 

contract, or otherwise.

6. “Allowed” means, with respect to any Claim, except as otherwise provided in 

the Plan: (a) any Claim that is evidenced by a Proof of Claim that has been timely Filed by the 

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001285

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3

Bar Date, or that is not required to be evidenced by a Filed Proof of Claim under the Bankruptcy 

Code or a Final Order; (b) a Claim that is listed in the Schedules as not contingent, not 

unliquidated, and not disputed and for which no Proof of Claim has been timely filed; (c) a 

Claim Allowed pursuant to the Plan or an order of the Bankruptcy Court that is not stayed 

pending appeal; or (d) a Claim that is not Disputed (including for which a Proof of Claim has 

been timely filed in a liquidated and noncontingent amount that has not been objected to by the 

Claims Objection Deadline or as to which any such objection has been overruled by Final 

Order); provided, however, that with respect to a Claim described in clauses (a) and (b) above, 

such Claim shall be considered Allowed only if and to the extent that, with respect to such 

Claim, no objection to the allowance thereof has been interposed within the applicable period of 

time fixed by the Plan, the Bankruptcy Code, the Bankruptcy Rules, or the Bankruptcy Court, or 

such an objection is so interposed and the Claim shall have been Allowed as set forth above. 

7. “Allowed Claim or Equity Interest” means a Claim or an Equity Interest of the 

type that has been Allowed.

8. “Assets” means all of the rights, titles, and interest of the Debtor, Reorganized 

Debtor, or Claimant Trust, in and to property of whatever type or nature, including, without 

limitation, real, personal, mixed, intellectual, tangible, and intangible property, the Debtor’s 

books and records, and the Causes of Action. 

9. “Available Cash” means any Cash in excess of the amount needed for the 

Claimant Trust and Reorganized Debtor to maintain business operations as determined in the 

sole discretion of the Claimant Trustee.

10. “Avoidance Actions” means any and all avoidance, recovery, subordination or 

other actions or remedies that may be brought by and on behalf of the Debtor or its Estate under 

the Bankruptcy Code or applicable nonbankruptcy law, including, without limitation, actions or 

remedies arising under sections 502, 510, 544, 545, and 547-553 of the Bankruptcy Code or 

under similar state or federal statutes and common law, including fraudulent transfer laws

11. “Ballot” means the form(s) distributed to holders of Impaired Claims or 

Equity Interests entitled to vote on the Plan on which to indicate their acceptance or rejection of 

the Plan.

12. “Bankruptcy Code” means title 11 of the United States Code, 11 U.S.C. 

§§ 101-1532, as amended from time to time and as applicable to the Chapter 11 Case. 

13. “Bankruptcy Court” means the United States Bankruptcy Court for the 

Northern District of Texas, Dallas Division, or any other court having jurisdiction over the 

Chapter 11 Case.

14. “Bankruptcy Rules” means the Federal Rules of Bankruptcy Procedure and the 

Local Rules of Bankruptcy Practice and Procedure of the United States Bankruptcy Court for the 

Northern District of Texas, Dallas Division, in each case as amended from time to time and as 

applicable to the Chapter 11 Case.

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001286

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4

15. “Bar Date” means the applicable deadlines set by the Bankruptcy Court for 

the filing of Proofs of Claim against the Debtor as set forth in the Bar Date Order, which 

deadlines may be or have been extended for certain Claimants by order of the Bankruptcy Court. 

16. “Bar Date Order” means the Order (I) Establishing Bar Dates for Filing 

Proofs of Claim and (II) Approving the Form and Manner of Notice Thereof [D.I. 488]. 

17. “Business Day” means any day, other than a Saturday, Sunday or “legal 

holiday” (as defined in Bankruptcy Rule 9006(a)). 

18. “Cash” means the legal tender of the United States of America or the 

equivalent thereof. 

19. “Causes of Action” means any action, claim, cross-claim, third-party claim, 

cause of action, controversy, demand, right, Lien, indemnity, contribution, guaranty, suit, 

obligation, liability, debt, damage, judgment, account, defense, remedy, offset, power, privilege, 

license and franchise of any kind or character whatsoever, in each case whether known, 

unknown, contingent or non-contingent, matured or unmatured, suspected or unsuspected, 

liquidated or unliquidated, disputed or undisputed, foreseen or unforeseen, direct or indirect, 

choate or inchoate, secured or unsecured, assertable directly or derivatively (including, without 

limitation, under alter ego theories), whether arising before, on, or after the Petition Date, in 

contract or in tort, in law or in equity or pursuant to any other theory of law. For the avoidance 

of doubt, Cause of Action includes, without limitation,: (a) any right of setoff, counterclaim or 

recoupment and any claim for breach of contract or for breach of duties imposed by law or in 

equity; (b) the right to object to Claims or Equity Interests; (c) any claim pursuant to section 362 

or chapter 5 of the Bankruptcy Code; (d) any claim or defense including fraud, mistake, duress 

and usury, and any other defenses set forth in section 558 of the Bankruptcy Code; (e) any claims 

under any state or foreign law, including, without limitation, any fraudulent transfer or similar 

claims; (f) the Avoidance Actions, and (g) the Estate Claims. The Causes of Action include, 

without limitation, the Causes of Action belonging to the Debtor’s Estate listed on the schedule 

of Causes of Action to be filed with the Plan Supplement. 

20. “CEO/CRO” means James P. Seery, Jr., the Debtor’s chief executive officer 

and chief restructuring officer. 

21. “Chapter 11 Case” means the Debtor’s case under chapter 11 of the 

Bankruptcy Code commenced on the Petition Date in the Delaware Bankruptcy Court and 

transferred to the Bankruptcy Court on December 4, 2019, and styled In re Highland Capital 

Management, L.P., Case No. 19-34054-sgj-11. 

22. “Claim” means any “claim” against the Debtor as defined in section 101(5) of 

the Bankruptcy Code. 

23. “Claims Objection Deadline” means the date that is 180 days after the 

Confirmation Date; provided, however, the Claims Objection Deadline may be extended by the 

Bankruptcy Court upon a motion by the Claimant Trustee. 

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001287

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24. “Claimant Trust” means the trust established for the benefit of the Claimant 

Trust Beneficiaries on the Effective Date in accordance with the terms of this Plan and the 

Claimant Trust Agreement.

25. “Claimant Trust Agreement” means the agreement Filed in the Plan 

Supplement establishing and delineating the terms and conditions of the Claimant Trust. 

26. “Claimant Trust Assets” means (i) other than the Reorganized Debtor Assets 

(which are expressly excluded from this definition), all other Assets of the Estate, including, but 

not limited to, all Causes of Action, Available Cash, any proceeds realized or received from such 

Assets, all rights of setoff, recoupment, and other defenses with respect, relating to, or arising 

from such Assets, (ii) any Assets transferred by the Reorganized Debtor to the Claimant Trust on 

or after the Effective Date, (iii) the limited partnership interests in the Reorganized Debtor, and 

(iv) the ownership interests in New GP LLC. For the avoidance of doubt, any Causes of Action 

that, for any reason, are not capable of being transferred to the Claimant Trust shall constitute 

Reorganized Debtor Assets. 

27. “Claimant Trust Beneficiaries” means the Holders of Allowed General 

Unsecured Claims, Holders of Allowed Subordinated Claims, including, upon Allowance, 

Disputed General Unsecured Claims and Disputed Subordinated Claims that become Allowed 

following the Effective Date, and, only upon certification by the Claimant Trustee that the 

Holders of such Claims have been paid indefeasibly in full plus, to the extent all Allowed 

unsecured Claims, excluding Subordinated Claims, have been paid in full, post-petition interest 

from the Petition Date at the Federal Judgment Rate in accordance with the terms and conditions 

set forth in the Claimant Trust Agreement and all Disputed Claims in Class 8 and Class 9 have 

been resolved, Holders of Allowed Class B/C Limited Partnership Interests, and Holders of 

Allowed Class A Limited Partnership Interests.

28. “Claimant Trustee” means James P. Seery, Jr., the Debtor’s chief executive 

officer and chief restructuring officer, or such other Person identified in the Plan Supplement 

who will act as the trustee of the Claimant Trust in accordance with the Plan, the Confirmation 

Order, and Claimant Trust Agreement or any replacement trustee pursuant to (and in accordance 

with) the Claimant Trust Agreement. The Claimant Trustee shall be responsible for, among 

other things, monetizing the Estate’s investment assets, resolving Claims (other than those 

Claims assigned to the Litigation Sub-Trust for resolution), and, as the sole officer of New GP 

LLC, winding down the Reorganized Debtor’s business operations. 

29. “Claimant Trust Expenses” means all reasonable legal and other reasonable 

professional fees, costs, and expenses incurred by the Trustees on account of administration of 

the Claimant Trust, including any reasonable administrative fees and expenses, reasonable 

attorneys’ fees and expenses, reasonable insurance costs, taxes, reasonable escrow expenses, and 

other expenses. 

30. “Claimant Trust Interests” means the non-transferable interests in the 

Claimant Trust that are issued to the Claimant Trust Beneficiaries pursuant to this Plan; 

provided, however, Holders of Class A Limited Partnership Interests, Class B Limited 

Partnership Interests, and Class C Limited Partnership Interests will not be deemed to hold 

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001288

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Claimant Trust Interests unless and until the Contingent Claimant Trust Interests distributed to 

such Holders vest in accordance with the terms of this Plan and the Claimant Trust Agreement. 

31. “Claimant Trust Oversight Committee” means the committee of five Persons 

established pursuant to ARTICLE IV of this Plan to oversee the Claimant Trustee’s performance 

of its duties and otherwise serve the functions described in this Plan and the Claimant Trust 

Agreement. 

32. “Class” means a category of Holders of Claims or Equity Interests as set forth 

in ARTICLE III hereof pursuant to section 1122(a) of the Bankruptcy Code. 

33. “Class A Limited Partnership Interest” means the Class A Limited Partnership 

Interests as defined in the Limited Partnership Agreement held by The Dugaboy Investment 

Trust, Mark and Pamela Okada Family Trust – Exempt Trust 2, Mark and Pamela Okada – 

Exempt Descendants’ Trust, and Mark Kiyoshi Okada, and the General Partner Interest. 

34. “Class B Limited Partnership Interest” means the Class B Limited Partnership 

Interests as defined in the Limited Partnership Agreement held by Hunter Mountain Investment 

Trust. 

35. “Class B/C Limited Partnership Interests” means, collectively, the Class B 

Limited Partnership and Class C Limited Partnership Interests.

36. “Class C Limited Partnership Interest” means the Class C Limited Partnership 

Interests as defined in the Limited Partnership Agreement held by Hunter Mountain Investment 

Trust.

37. “Committee” means the Official Committee of Unsecured Creditors 

appointed by the U.S. Trustee pursuant to 11 U.S.C. § 1102(a)(1) on October 29, 2019 [D.I. 65], 

consisting of (i) the Redeemer Committee of Highland Crusader Fund, (ii) Meta-e Discovery, 

(iii) UBS, and (iv) Acis. 

38. “Confirmation Date” means the date on which the clerk of the Bankruptcy 

Court enters the Confirmation Order on the docket of the Bankruptcy Court. 

39. “Confirmation Hearing” means the hearing held by the Bankruptcy Court 

pursuant to section 1128 of the Bankruptcy Code to consider confirmation of this Plan, as such 

hearing may be adjourned or continued from time to time. 

40. “Confirmation Order” means the order of the Bankruptcy Court confirming 

this Plan pursuant to section 1129 of the Bankruptcy Code. 

41. “Convenience Claim” means any prepetition, liquidated, and unsecured 

Claim against the Debtor that as of the Confirmation Date is less than or equal to $1,000,000 or 

any General Unsecured Claim that makes the Convenience Class Election. For the avoidance of 

doubt, the Reduced Employee Claims will be Convenience Claims. 

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001289

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42. “Convenience Claim Pool” means the $13,150,000 in Cash that shall be 

available upon the Effective Date for distribution to Holders of Convenience Claims under the 

Plan as set forth herein. Any Cash remaining in the Convenience Claim Pool after all 

distributions on account of Convenience Claims have been made will be transferred to the 

Claimant Trust and administered as a Claimant Trust Asset. 

43. “Convenience Class Election” means the option provided to each Holder of a 

General Unsecured Claim that is a liquidated Claim as of the Confirmation Date on their Ballot 

to elect to reduce their claim to $1,000,000 and receive the treatment provided to Convenience 

Claims.

44. “Contingent Claimant Trust Interests” means the contingent Claimant Trust 

Interests to be distributed to Holders of Class A Limited Partnership Interests, Holders of Class B 

Limited Partnership Interests, and Holders of Class C Limited Partnership Interests in 

accordance with this Plan, the rights of which shall not vest, and consequently convert to 

Claimant Trust Interests, unless and until the Claimant Trustee Files a certification that all 

holders of Allowed General Unsecured Claims have been paid indefeasibly in full, plus, to the 

extent all Allowed unsecured Claims, excluding Subordinated Claims, have been paid in full, all 

accrued and unpaid post-petition interest from the Petition Date at the Federal Judgment Rate

and all Disputed Claims in Class 8 and Class 9 have been resolved. As set forth in the Claimant 

Trust Agreement, the Contingent Claimant Trust Interests distributed to the Holders of Class A 

Limited Partnership Interests will be subordinated to the Contingent Claimant Trust Interests 

distributed to the Holders of Class B/C Limited Partnership Interests.

45. “Debtor” means Highland Capital Management, L.P. in its capacity as debtor 

and debtor in possession in the Chapter 11 Case. 

46. “Delaware Bankruptcy Court” means the United States Bankruptcy Court for 

the District of Delaware.

47. “Disclosure Statement” means that certain Disclosure Statement for Debtor’s 

Fifth Amended Chapter 11 Plan of Reorganization, as amended, supplemented, or modified from 

time to time, which describes this Plan, including all exhibits and schedules thereto and 

references therein that relate to this Plan. 

48. “Disputed” means with respect to any Claim or Equity Interest, any Claim or

Equity Interest that is not yet Allowed. 

49. “Disputed Claims Reserve” means the appropriate reserve(s) or account(s) to 

be established on the Initial Distribution Date and maintained by the Claimant Trustee for 

distributions on account of Disputed Claims that may subsequently become an Allowed Claim.

50. “Disputed Claims Reserve Amount” means, for purposes of determining the 

Disputed Claims Reserve, the Cash that would have otherwise been distributed to a Holder of a 

Disputed Claim at the time any distributions of Cash are made to the Holders of Allowed Claims. 

The amount of the Disputed Claim upon which the Disputed Claims Reserve is calculated shall 

be: (a) the amount set forth on either the Schedules or the filed Proof of Claim, as applicable; (b) 

the amount agreed to by the Holder of the Disputed Claim and the Claimant Trustee or 

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001290

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8

Reorganized Debtor, as applicable; (c) the amount ordered by the Bankruptcy Court if it enters 

an order disallowing, in whole or in part, a Disputed Claim; or (d) as otherwise ordered by the 

Bankruptcy Court, including an order estimating the Disputed Claim. 

51. “Distribution Agent” means the Claimant Trustee, or any party designated by 

the Claimant Trustee to serve as distribution agent under this Plan. 

52. “Distribution Date” means the date or dates determined by the Reorganized 

Debtor or the Claimant Trustee, as applicable, on or after the Initial Distribution Date upon 

which the Distribution Agent shall make distributions to holders of Allowed Claims and Interests 

entitled to receive distributions under the Plan. 

53. “Distribution Record Date” means the date for determining which Holders of 

Claims and Equity Interests are eligible to receive distributions hereunder, which date shall be 

the Effective Date or such later date determined by the Bankruptcy Court. 

54. “Effective Date” means the Business Day that this Plan becomes effective as 

provided in ARTICLE VIII hereof.

55. “Employees” means the employees of the Debtor set forth in the Plan 

Supplement. 

56. “Enjoined Parties” means (i) all Entities who have held, hold, or may hold 

Claims against or Equity Interests in the Debtor (whether or not proof of such Claims or Equity 

Interests has been filed and whether or not such Entities vote in favor of, against or abstain from 

voting on the Plan or are presumed to have accepted or deemed to have rejected the Plan), (ii) 

James Dondero (“Dondero”), (iii) any Entity that has appeared and/or filed any motion, 

objection, or other pleading in this Chapter 11 Case regardless of the capacity in which such 

Entity appeared and any other party in interest, (iv) any Related Entity, and (v) the Related 

Persons of each of the foregoing. 

57. “Entity” means any “entity” as defined in section 101(15) of the Bankruptcy 

Code and also includes any Person or any other entity. 

58. “Equity Interest” means any Equity Security in the Debtor, including, without 

limitation, all issued, unissued, authorized or outstanding partnership interests, shares, of stock or 

limited company interests, the Class A Limited Partnership Interests, the Class B Limited 

Partnership Interests, and the Class C Limited Partnership Interests.

59. “Equity Security” means an “equity security” as defined in section 101(16) of 

the Bankruptcy Code. 

60. “Estate” means the bankruptcy estate of the Debtor created by virtue of 

section 541 of the Bankruptcy Code upon the commencement of the Chapter 11 Case.

61. “Estate Claims” has the meaning given to it in Exhibit A to the Notice of 

Final Term Sheet [D.I. 354]. 

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001291

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9

62. “Exculpated Parties” means, collectively, (i) the Debtor and its successors and 

assigns, direct and indirect majority-owned subsidiaries, and the Managed Funds, (ii) the 

Employees, (iii) Strand, (iv) the Independent Directors, (v) the Committee, (vi) the members of 

the Committee (in their official capacities), (vii) the Professionals retained by the Debtor and the 

Committee in the Chapter 11 Case, (viii) the CEO/CRO; and (ix) the Related Persons of each of 

the parties listed in (iv) through (viii); provided, however, that, for the avoidance of doubt, none 

of James Dondero, Mark Okada, NexPoint Advisors, L.P. (and any of its subsidiaries and 

managed entities), the Charitable Donor Advised Fund, L.P. (and any of its subsidiaries, 

including CLO Holdco, Ltd., and managed entities), Highland CLO Funding, Ltd. (and any of its 

subsidiaries, members, and managed entities), Highland Capital Management Fund Advisors, 

L.P. (and any of its subsidiaries and managed entities), NexBank, SSB (and any of its 

subsidiaries), the Hunter Mountain Investment Trust (or any trustee acting for the trust), the 

Dugaboy Investment Trust (or any trustee acting for the trust), or Grant Scott is included in the 

term “Exculpated Party.”

63. “Executory Contract” means a contract to which the Debtor is a party that is 

subject to assumption or rejection under sections 365 or 1123 of the Bankruptcy Code. 

64. “Exhibit” means an exhibit annexed hereto or to the Disclosure Statement (as 

such exhibits are amended, modified or otherwise supplemented from time to time), which are 

incorporated by reference herein.

65. “Federal Judgment Rate” means the post-judgment interest rate set forth in 28 

U.S.C. § 1961 as of the Effective Date. 

66. “File” or “Filed” or “Filing” means file, filed or filing with the Bankruptcy 

Court or its authorized designee in the Chapter 11 Case.

67. “Final Order” means an order or judgment of the Bankruptcy Court, which is 

in full force and effect, and as to which the time to appeal, petition for certiorari, or move for a 

new trial, reargument or rehearing has expired and as to which no appeal, petition for certiorari,

or other proceedings for a new trial, reargument or rehearing shall then be pending or as to which 

any right to appeal, petition for certiorari, new trial, reargument, or rehearing shall have been 

waived in writing in form and substance satisfactory to the Debtor, the Reorganized Debtor, or 

the Claimant Trustee, as applicable, or, in the event that an appeal, writ of certiorari, new trial, 

reargument, or rehearing thereof has been sought, such order of the Bankruptcy Court shall have 

been determined by the highest court to which such order was appealed, or certiorari, new trial, 

reargument or rehearing shall have been denied and the time to take any further appeal, petition 

for certiorari, or move for a new trial, reargument or rehearing shall have expired; provided, 

however, that the possibility that a motion under 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 preclude such order from being a Final Order. 

68. “Frontier Secured Claim” means the loan from Frontier State Bank to the 

Debtor in the principal amount of $7,879,688.00 made pursuant to that certain First Amended 

and Restated Loan Agreement, dated March 29, 2018. 

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001292

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10

69. “General Partner Interest” means the Class A Limited Partnership Interest 

held by Strand, as the Debtor’s general partner. 

70. “General Unsecured Claim” means any prepetition Claim against the Debtor 

that is not Secured and is not a/an: (a) Administrative Expense Claim; (b) Professional Fee 

Claim; (c) Priority Tax Claim; (d) Priority Non-Tax Claim; or (e) Convenience Claim. 

71. “Governmental Unit” means a “governmental unit” as defined in 

section 101(27) of the Bankruptcy Code. 

72. “GUC Election” means the option provided to each Holder of a Convenience 

Claim on their Ballot to elect to receive the treatment provided to General Unsecured Claims. 

73. “Holder” means an Entity holding a Claim against, or Equity Interest in, the 

Debtor. 

74. “Impaired” means, when used in reference to a Claim or Equity Interest, a 

Claim or Equity Interest that is impaired within the meaning of section 1124 of the Bankruptcy 

Code. 

75. “Independent Directors” means John S. Dubel, James P. Seery, Jr., and 

Russell Nelms, the independent directors of Strand appointed on January 9, 2020, and any 

additional or replacement directors of Strand appointed after January 9, 2020, but prior to the 

Effective Date. 

76. “Initial Distribution Date” means, subject to the “Treatment” sections in 

ARTICLE III hereof, the date that is on or as soon as reasonably practicable after the Effective 

Date, when distributions under this Plan shall commence to Holders of Allowed Claims and 

Equity Interests.

77. “Insurance Policies” means all insurance policies maintained by the Debtor as 

of the Petition Date.

78. “Jefferies Secured Claim” means any Claim in favor of Jefferies, LLC, arising 

under that certain Prime Brokerage Customer Agreement, dated May 24, 2013, between the 

Debtor and Jefferies, LLC, that is secured by the assets, if any, maintained in the prime 

brokerage account created by such Prime Brokerage Customer Agreement. 

79. “Lien” means a “lien” as defined in section 101(37) of the Bankruptcy Code 

and, with respect to any asset, includes, without limitation, any mortgage, lien, pledge, charge, 

security interest or other encumbrance of any kind, or any other type of preferential arrangement 

that has the practical effect of creating a security interest, in respect of such asset.

80. “Limited Partnership Agreement” means that certain Fourth Amended and 

Restated Agreement of Limited Partnership of Highland Capital Management, L.P., dated 

December 24, 2015, as amended. 

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001293

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81. “Litigation Sub-Trust” means the sub-trust established within the Claimant 

Trust or as a wholly –owned subsidiary of the Claimant Trust on the Effective Date in each case 

in accordance with the terms and conditions set forth in the Litigation Sub-Trust Agreement and 

Claimant Trust Agreement. As set forth in the Litigation Sub-Trust Agreement, the Litigation 

Sub-Trust shall hold the Claimant Trust Assets that are Estate Claims.

82. “Litigation Sub-Trust Agreement” means the agreement filed in the Plan 

Supplement establishing and delineating the terms and conditions of the Litigation Sub-Trust. 

83. “Litigation Trustee” means the trustee appointed by the Committee and 

reasonably acceptable to the Debtor who shall be responsible for investigating, litigating, and 

settling the Estate Claims for the benefit of the Claimant Trust in accordance with the terms and 

conditions set forth in the Litigation Sub-Trust Agreement. 

84. “Managed Funds” means Highland Multi-Strategy Credit Fund, L.P., 

Highland Restoration Capital Partners, L.P., and any other investment vehicle managed by the 

Debtor pursuant to an Executory Contract assumed pursuant to this Plan. 

85. “New Frontier Note” means that promissory note to be provided to the 

Allowed Holders of Class 2 Claims under this Plan and any other documents or security 

agreements securing the obligations thereunder. 

86. “New GP LLC” means a limited liability company incorporated in the State of 

Delaware pursuant to the New GP LLC Documents to serve as the general partner of the 

Reorganized Debtor on the Effective Date. 

87. “New GP LLC Documents” means the charter, operating agreement, and other 

formational documents of New GP LLC. 

88. “Ordinary Course Professionals Order” means that certain Order Pursuant to 

Sections 105(a), 327, 328, and 330 of the Bankruptcy Code Authorizing the Debtor to Retain, 

Employ, and Compensate Certain Professionals Utilized by the Debtor in the Ordinary Course 

[D.I. 176]. 

89. “Other Unsecured Claim” means any Secured Claim other than the Jefferies 

Secured Claim and the Frontier Secured Claim. 

90. “Person” means a “person” as defined in section 101(41) of the Bankruptcy 

Code and also includes any natural person, individual, corporation, company, general or limited 

partnership, limited liability company, unincorporated organization firm, trust, estate, business 

trust, association, joint stock company, joint venture, government, governmental agency, 

Governmental Unit or any subdivision thereof, the United States Trustee, or any other entity, 

whether acting in an individual, fiduciary or other capacity. 

91. “Petition Date” means October 16, 2019. 

92. “Plan” means this Debtor’s Fifth Amended Chapter 11 Plan of 

Reorganization, including the Exhibits and the Plan Documents and all supplements, appendices, 

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12

and schedules thereto, either in its present form or as the same may be altered, amended, 

modified or otherwise supplemented from time to time.

93. “Plan Distribution” means the payment or distribution of consideration to 

Holders of Allowed Claims and Allowed Equity Interests under this Plan. 

94. “Plan Documents” means any of the documents, other than this Plan, but 

including, without limitation, the documents to be filed with the Plan Supplement, to be 

executed, delivered, assumed, or performed in connection with the occurrence of the Effective 

Date, and as may be modified consistent with the terms hereof with the consent of the 

Committee. 

95. “Plan Supplement” means the ancillary documents necessary for the 

implementation and effectuation of the Plan, including, without limitation, (i) the form of 

Claimant Trust Agreement, (ii) the forms of New GP LLC Documents, (iii) the form of 

Reorganized Limited Partnership Agreement, (iv) the Sub-Servicer Agreement (if applicable), 

(v) the identity of the initial members of the Claimant Trust Oversight Committee, (vi) the form 

of Litigation Sub-Trust Agreement; (vii) the schedule of retained Causes of Action; (viii) the 

New Frontier Note, (ix) the schedule of Employees; (x) the form of Senior Employee 

Stipulation,; and (xi) the schedule of Executory Contracts and Unexpired Leases to be assumed 

pursuant to this Plan, which, in each case, will be in form and substance reasonably acceptable to 

the Debtor and the Committee. 

96. “Priority Non-Tax Claim” means a Claim entitled to priority pursuant to 

section 507(a) of the Bankruptcy Code, including any Claims for paid time-off entitled to 

priority under section 507(a)(4) of the Bankruptcy Code, other than a Priority Tax Claim or an 

Administrative Claim.

97. “Pro Rata” means the proportion that (a) the Allowed amount of a Claim or 

Equity Interest in a particular Class bears to (b) the aggregate Allowed amount of all Claims or 

Equity Interests in such Class. 

98. “Professional” means (a) any Entity employed in the Chapter 11 Case 

pursuant to section 327, 328 363 or 1103 of the Bankruptcy Code or otherwise and (b) any Entity 

seeking compensation or reimbursement of expenses in connection with the Chapter 11 Case 

pursuant to sections 327, 328, 330, 331, 363, 503(b), 503(b)(4) and 1103 of the Bankruptcy 

Code. 

99. “Professional Fee Claim” means a Claim under sections 328, 330(a), 331, 

363, 503 or 1103 of the Bankruptcy Code, with respect to a particular Professional, for 

compensation for services rendered or reimbursement of costs, expenses or other charges 

incurred after the Petition Date and prior to and including the Effective Date. 

100. “Professional Fee Claims Bar Date” means with respect to Professional 

Fee Claims, the Business Day which is sixty (60) days after the Effective Date or such other date 

as approved by order of the Bankruptcy Court. 

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101. “Professional Fee Claims Objection Deadline” means, with respect to any 

Professional Fee Claim, thirty (30) days after the timely Filing of the applicable request for 

payment of such Professional Fee Claim. 

102. “Professional Fee Reserve” means the reserve established and funded by 

the Claimant Trustee pursuant this Plan to provide sufficient funds to satisfy in full unpaid 

Allowed Professional Fee Claims.

103. “Proof of Claim” means a written proof of Claim or Equity Interest Filed 

against the Debtor in the Chapter 11 Case.

104. “Priority Tax Claim” means any Claim of a Governmental Unit of the 

kind specified in section 507(a)(8) of the Bankruptcy Code. 

105. “Protected Parties” means, collectively, (i) the Debtor and its successors 

and assigns, direct and indirect majority-owned subsidiaries, and the Managed Funds, (ii) the 

Employees, (iii) Strand, (iv) the Reorganized Debtor, (v) the Independent Directors, (vi) the 

Committee, (vii) the members of the Committee (in their official capacities), (viii) the Claimant 

Trust, (ix) the Claimant Trustee, (x) the Litigation Sub-Trust, (xi) the Litigation Trustee, (xii) the 

members of the Claimant Trust Oversight Committee (in their official capacities), (xiii) New GP 

LLC, (xiv) the Professionals retained by the Debtor and the Committee in the Chapter 11 Case, 

(xv) the CEO/CRO; and (xvi) the Related Persons of each of the parties listed in (iv) through 

(xv); provided, however, that, for the avoidance of doubt, none of James Dondero, Mark Okada, 

NexPoint Advisors, L.P. (and any of its subsidiaries and managed entities), the Charitable Donor 

Advised Fund, L.P. (and any of its subsidiaries, including CLO Holdco, Ltd., and managed 

entities), Highland CLO Funding, Ltd. (and any of its subsidiaries, members, and managed 

entities), NexBank, SSB (and any of its subsidiaries), Highland Capital Management Fund 

Advisors, L.P. (and any of its subsidiaries and managed entities), the Hunter Mountain 

Investment Trust (or any trustee acting for the trust), the Dugaboy Investment Trust (or any 

trustee acting for the trust), or Grant Scott is included in the term “Protected Party.”

106. “PTO Claims” means any Claim for paid time off in favor of any Debtor 

employee in excess of the amount that would qualify as a Priority Non-Tax Claim under section 

507(a)(4) of the Bankruptcy Code. 

107. “Reduced Employee Claims” has the meaning set forth in ARTICLE IX.D. 

108. “Reinstated” means, with respect to any Claim or Equity Interest, (a) 

leaving unaltered the legal, equitable, and contractual rights to which a Claim entitles the Holder 

of such Claim or Equity Interest in accordance with section 1124 of the Bankruptcy Code or (b) 

notwithstanding any contractual provision or applicable law that entitles the Holder of such 

Claim or Equity Interest to demand or receive accelerated payment of such Claim or Equity 

Interest after the occurrence of a default: (i) curing any such default that occurred before or after 

the Petition Date, other than a default of a kind specified in section 365(b)(2) of the Bankruptcy 

Code or of a kind that section 365(b)(2) of the Bankruptcy Code expressly does not require to be 

cured; (ii) reinstating the maturity of such Claim or Equity Interest as such maturity existed 

before such default; (iii) compensating the Holder of such Claim or Equity Interest for any

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damages incurred as a result of any reasonable reliance by such Holder on such contractual 

provision or such applicable law; (iv) if such Claim or Equity Interest arises from any failure to 

perform a nonmonetary obligation, other than a default arising from failure to operate a nonresidential real property lease subject to section 365(b)(1)(A) of the Bankruptcy Code, 

compensating the Holder of such Claim or Equity Interest (other than any Debtor or an insider of 

any Debtor) for any actual pecuniary loss incurred by such Holder as a result of such failure; and 

(v) not otherwise altering the legal, equitable, or contractual rights to which such Claim entitles 

the Holder of such Claim. 

109. “Rejection Claim” means any Claim for monetary damages as a result of 

the rejection of an executory contract or unexpired lease pursuant to the Confirmation Order. 

110. “Related Entity” means, without duplication, (a) Dondero, (b) Mark Okada 

(“Okada”), (c) Grant Scott (“Scott”), (d) Hunter Covitz (“Covitz”), (e) any entity or person that 

was an insider of the Debtor on or before the Petition Date under Section 101(31) of the 

Bankruptcy Code, including, without limitation, any entity or person that was a non-statutory 

insider, (f) any entity that, after the Effective Date, is an insider or Affiliate of one or more of 

Dondero, Okada, Scott, Covitz, or any of their respective insiders or Affiliates, including, 

without limitation, The Dugaboy Investment Trust, (g) the Hunter Mountain Investment Trust 

and any of its direct or indirect parents, (h) the Charitable Donor Advised Fund, L.P., and any of 

its direct or indirect subsidiaries, and (i) Affiliates of the Debtor and any other Entities listed on 

the Related Entity List. 

111. “Related Entity List” means that list of Entities filed with the Plan

Supplement. 

112. “Related Persons” means, with respect to any Person, such Person’s 

predecessors, successors, assigns (whether by operation of law or otherwise), and each of their 

respective present, future, or former officers, directors, employees, managers, managing 

members, members, financial advisors, attorneys, accountants, investment bankers, consultants, 

professionals, advisors, shareholders, principals, partners, subsidiaries, divisions, management 

companies, heirs, agents, and other representatives, in each case solely in their capacity as such.

113. “Released Parties” means, collectively, (i) the Independent Directors; (ii) 

Strand (solely from the date of the appointment of the Independent Directors through the 

Effective Date); (iii) the CEO/CRO; (iv) the Committee; (v) the members of the Committee (in 

their official capacities), (vi) the Professionals retained by the Debtor and the Committee in the 

Chapter 11 Case; and (vii) the Employees. 

114. “Reorganized Debtor” means the Debtor, as reorganized pursuant to this 

Plan on and after the Effective Date. 

115. “Reorganized Debtor Assets” means any limited and general partnership 

interests held by the Debtor, the management of the Managed Funds and those Causes of Action 

(including, without limitation, claims for breach of fiduciary duty), that, for any reason, are not 

capable of being transferred to the Claimant Trust. For the avoidance of doubt, “Reorganized 

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001297

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Debtor Assets” includes any partnership interests or shares of Managed Funds held by the Debtor 

but does not include the underlying portfolio assets held by the Managed Funds. 

116. “Reorganized Limited Partnership Agreement” means that certain Fifth 

Amended and Restated Agreement of Limited Partnership of Highland Capital Management, 

L.P., by and among the Claimant Trust, as limited partner, and New GP LLC, as general partner, 

Filed with the Plan Supplement.

117. “Restructuring” means the restructuring of the Debtor, the principal terms 

of which are set forth in this Plan and the Disclosure Statement. 

118. “Retained Employee Claim” means any Claim filed by a current employee 

of the Debtor who will be employed by the Reorganized Debtor upon the Effective Date. 

119. “Schedules” means the schedules of Assets and liabilities, statements of 

financial affairs, lists of Holders of Claims and Equity Interests and all amendments or 

supplements thereto Filed by the Debtor with the Bankruptcy Court [D.I. 247]. 

120. “Secured” means, when referring to a Claim: (a) secured by a Lien on 

property in which the Debtor’s Estate has an interest, which Lien is valid, perfected, and 

enforceable pursuant to applicable law or by reason of a Bankruptcy Court order, or that is 

subject to setoff pursuant to section 553 of the Bankruptcy Code, to the extent of the value of the 

creditor’s interest in the interest of the Debtor’s Estate in such property or to the extent of the 

amount subject to setoff, as applicable, as determined pursuant to section 506(a) of the 

Bankruptcy Code or (b) Allowed pursuant to the Plan as a Secured Claim. 

121. “Security” or “security” means any security as such term is defined in 

section 101(49) of the Bankruptcy Code. 

122. “Senior Employees” means the senior employees of the Debtor Filed in the 

Plan Supplement. 

123. “Senior Employee Stipulation” means the agreements filed in the Plan 

Supplement between each Senior Employee and the Debtor. 

124. “Stamp or Similar Tax” means any stamp tax, recording tax, personal 

property tax, conveyance fee, intangibles or similar tax, real estate transfer tax, sales tax, use tax,

transaction privilege tax (including, without limitation, such taxes on prime contracting and 

owner-builder sales), privilege taxes (including, without limitation, privilege taxes on 

construction contracting with regard to speculative builders and owner builders), and other 

similar taxes imposed or assessed by any Governmental Unit.

125. “Statutory Fees” means fees payable pursuant to 28 U.S.C. § 1930. 

126. “Strand” means Strand Advisors, Inc., the Debtor’s general partner.

127. “Sub-Servicer” means a third-party selected by the Claimant Trustee to 

service or sub-service the Reorganized Debtor Assets. 

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128. “Sub-Servicer Agreement” means the agreement that may be entered into 

providing for the servicing of the Reorganized Debtor Assets by the Sub-Servicer.

129. “Subordinated Claim” means any Claim that is subordinated to the 

Convenience Claims and General Unsecured Claims pursuant to 11 U.S.C. § 510 or order 

entered by the Bankruptcy Court. 

130. “Subordinated Claimant Trust Interests” means the Claimant Trust 

Interests to be distributed to Holders of Allowed Subordinated Claims under the Plan, which 

such interests shall be subordinated in right and priority to the Claimant Trust Interests 

distributed to Holders of Allowed General Unsecured Claims as provided in the Claimant Trust 

Agreement. 

131. “Trust Distribution” means the transfer of Cash or other property by the 

Claimant Trustee to the Claimant Trust Beneficiaries.

132. “Trustees” means, collectively, the Claimant Trustee and Litigation 

Trustee. 

133. “UBS” means, collectively, UBS Securities LLC and UBS AG London 

Branch.

134. “Unexpired Lease” means a lease to which the Debtor is a party that is 

subject to assumption or rejection under section 365 of the Bankruptcy Code. 

135. “Unimpaired” means, with respect to a Class of Claims or Equity Interests 

that is not impaired within the meaning of section 1124 of the Bankruptcy Code. 

136. “Voting Deadline” means the date and time by which all Ballots to accept 

or reject the Plan must be received in order to be counted under the under the Order of the 

Bankruptcy Court approving the Disclosure Statement as containing adequate information 

pursuant to section 1125(a) of the Bankruptcy Code and authorizing the Debtor to solicit 

acceptances of the Plan. 

137. “Voting Record Date” means November 23, 2020. 

ARTICLE II.

ADMINISTRATIVE EXPENSES AND PRIORITY TAX CLAIMS

A. Administrative Expense Claims

On the later of the Effective Date or the date on which an Administrative Expense Claim 

becomes an Allowed Administrative Expense Claim, or, in each such case, as soon as practicable 

thereafter, each Holder of an Allowed Administrative Expense Claim (other than Professional 

Fee Claims) will receive, in full satisfaction, settlement, discharge and release of, and in 

exchange for, such Allowed Administrative Expense Claim either (i) payment in full in 

Available Cash for the unpaid portion of such Allowed Administrative Expense Claim; or 

(ii) such other less favorable treatment as agreed to in writing by the Debtor or the Reorganized 

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Debtor, as applicable, and such Holder; provided, however, that Administrative Expense Claims 

incurred by the Debtor in the ordinary course of business may be paid in the ordinary course of 

business in the discretion of the Debtor in accordance with such applicable terms and conditions 

relating thereto without further notice to or order of the Bankruptcy Court. All statutory fees 

payable under 28 U.S.C. § 1930(a) shall be paid as such fees become due. 

If an Administrative Expense Claim (other than a Professional Fee Claim) is not paid by 

the Debtor in the ordinary course, the Holder of such Administrative Expense Claim must File, 

on or before the applicable Administrative Expense Claims Bar Date, and serve on the Debtor or 

Reorganized Debtor, as applicable, and such other Entities who are designated by the 

Bankruptcy Rules, the Confirmation Order or other order of the Bankruptcy Court, an 

application for allowance and payment of such Administrative Expense Claim. 

Objections to any Administrative Expense Claim (other than a Professional Fee Claim) 

must be Filed and served on the Debtor or the Reorganized Debtor, as applicable, and the party 

asserting such Administrative Expense Claim by the Administrative Expense Claims Objection 

Deadline. 

B. Professional Fee Claims

Professionals or other Entities asserting a Professional Fee Claim for services rendered 

through the Effective Date must submit fee applications under sections 327, 328, 329,330, 331, 

503(b) or 1103 of the Bankruptcy Code and, upon entry of an order of the Bankruptcy Court 

granting such fee applications, such Professional Fee Claim shall promptly be paid in Cash in 

full to the extent provided in such order. 

Professionals or other Entities asserting a Professional Fee Claim for services rendered on 

or prior to the Effective Date must File, on or before the Professional Fee Claims Bar Date, and 

serve on the Debtor or Reorganized Debtor, as applicable, and such other Entities who are 

designated as requiring such notice by the Bankruptcy Rules, the Confirmation Order or other 

order of the Bankruptcy Court, an application for final allowance of such Professional Fee 

Claim. 

Objections to any Professional Fee Claim must be Filed and served on the Debtor or 

Reorganized Debtor, as applicable, and the party asserting the Professional Fee Claim by the 

Professional Fee Claim Objection Deadline. Each Holder of an Allowed Professional Fee Claim 

will be paid by the Debtor or the Claimant Trust, as applicable, in Cash within ten (10) Business 

Days of entry of the order approving such Allowed Professional Fee Claim. 

On the Effective Date, the Claimant Trustee shall establish the Professional Fee Reserve. 

The Professional Fee Reserve shall vest in the Claimant Trust and shall be maintained by the 

Claimant Trustee in accordance with the Plan and Claimant Trust Agreement. The Claimant 

Trust shall fund the Professional Fee Reserve on the Effective Date in an estimated amount 

determined by the Debtor in good faith prior to the Confirmation Date and that approximates the 

total projected amount of unpaid Professional Fee Claims on the Effective Date. Following the 

payment of all Allowed Professional Fee Claims, any excess funds in the Professional Fee 

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001300

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Reserve shall be released to the Claimant Trust to be used for other purposes consistent with the 

Plan and the Claimant Trust Agreement.

C. Priority Tax Claims 

On or as soon as reasonably practicable after the later of (i) the Initial Distribution Date if 

such Priority Tax Claim is an Allowed Priority Tax Claim as of the Effective Date or (ii) the date 

on which such Priority Tax Claim becomes an Allowed Priority Tax Claim, each Holder of an 

Allowed Priority Tax Claim will receive in full satisfaction, settlement, discharge and release of, 

and in exchange for, such Allowed Priority Tax Claim, at the election of the Debtor: (a) Cash in 

an amount equal to the amount of such Allowed Priority Tax Claim, (b) payment of such 

Allowed Priority Tax Claim in accordance with section 1129(a)(9)(C) of the Bankruptcy Code; 

or (c) such other less favorable treatment as agreed to in writing by the Debtor and such Holder. 

Payment of statutory fees due pursuant to 28 U.S.C. § 1930(a)(6) will be made at all appropriate 

times until the entry of a final decree; provided, however, that the Debtor may prepay any or all 

such Claims at any time, without premium or penalty. 

ARTICLE III.

CLASSIFICATION AND TREATMENT OF 

CLASSIFIED CLAIMS AND EQUITY INTERESTS

A. Summary

All Claims and Equity Interests, except Administrative Expense Claims and Priority Tax 

Claims, are classified in the Classes set forth below. In accordance with section 1123(a)(1) of 

the Bankruptcy Code, Administrative Expense Claims, and Priority Tax Claims have not been 

classified.

The categories of Claims and Equity Interests listed below classify Claims and Equity 

Interests for all purposes including, without limitation, confirmation and distribution pursuant to 

the Plan and pursuant to sections 1122 and 1123(a)(1) of the Bankruptcy Code. The Plan deems 

a Claim or Equity Interest to be classified in a particular Class only to the extent that the Claim 

or Equity Interest qualifies within the description of that Class and will be 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. A Claim or Equity Interest is in a particular Class only to 

the extent that any such Claim or Equity Interest is Allowed in that Class and has not been paid, 

released or otherwise settled (in each case, by the Debtor or any other Entity) prior to the 

Effective Date.

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001301

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B. Summary of Classification and Treatment of Classified Claims and Equity Interests

Class Claim Status Voting Rights 

1 Jefferies Secured Claim Unimpaired Deemed to Accept

2 Frontier Secured Claim Impaired Entitled to Vote

3 Other Secured Claims Unimpaired Deemed to Accept

4 Priority Non-Tax Claim Unimpaired Deemed to Accept

5 Retained Employee Claim Unimpaired Deemed to Accept

6 PTO Claims Unimpaired Deemed to Accept

7 Convenience Claims Impaired Entitled to Vote

8 General Unsecured Claims Impaired Entitled to Vote

9 Subordinated Claims Impaired Entitled to Vote

10 Class B/C Limited Partnership Interests Impaired Entitled to Vote

11 Class A Limited Partnership Interests Impaired Entitled to Vote

C. Elimination of Vacant Classes

Any Class that, as of the commencement of the Confirmation Hearing, does not have at

least one Holder of a Claim or Equity Interest that is Allowed in an amount greater than zero for 

voting purposes shall be considered vacant, deemed eliminated from the Plan for purposes of 

voting to accept or reject the Plan, and disregarded for purposes of determining whether the Plan 

satisfies section 1129(a)(8) of the Bankruptcy Code with respect to such Class. 

D. Impaired/Voting Classes 

Claims and Equity Interests in Class 2 and Class 7 through Class 11 are Impaired by the 

Plan, and only the Holders of Claims or Equity Interests in those Classes are entitled to vote to 

accept or reject the Plan.

E. Unimpaired/Non-Voting Classes 

Claims in Class 1 and Class 3 through Class 6 are Unimpaired by the Plan, and such 

Holders are deemed to have accepted the Plan and are therefore not entitled to vote on the Plan. 

F. Impaired/Non-Voting Classes

There are no Classes under the Plan that will not receive or retain any property and no 

Classes are deemed to reject the Plan. 

G. Cramdown

If any Class of Claims or Equity Interests is deemed to reject this Plan or does not vote to 

accept this Plan, the Debtor may (i) seek confirmation of this Plan under section 1129(b) of the 

Bankruptcy Code or (ii) amend or modify this Plan in accordance with the terms hereof and the 

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001302

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Bankruptcy Code. If a controversy arises as to whether any Claims or Equity Interests, or any 

class of Claims or Equity Interests, are Impaired, the Bankruptcy Court shall, after notice and a 

hearing, determine such controversy on or before the Confirmation Date. 

H. Classification and Treatment of Claims and Equity Interests

1. Class 1 – Jefferies Secured Claim

x Classification: Class 1 consists of the Jefferies Secured Claim.

x Treatment: On or as soon as reasonably practicable after the Effective 

Date, each Holder of an Allowed Class 1 Claim will receive in full 

satisfaction, settlement, discharge and release of, and in exchange for, 

such Allowed Class 1 Claim, at the election of the Debtor: (A) Cash equal 

to the amount of such Allowed Class 1 Claim; (B) such other less 

favorable treatment as to which the Debtor and the Holder of such 

Allowed Class 1 Claim will have agreed upon in writing; or (C) such other 

treatment rendering such Claim Unimpaired. Each Holder of an Allowed 

Class 1 Claim will retain the Liens securing its Allowed Class 1 Claim as 

of the Effective Date until full and final payment of such Allowed Class 1 

Claim is made as provided herein. 

x Impairment and Voting: Class 1 is Unimpaired, and the Holders of 

Class 1 Claims are conclusively deemed to have accepted this Plan 

pursuant to section 1126(f) of the Bankruptcy Code. Therefore, the 

Holders of Class 1 Claims are not entitled to vote to accept or reject this 

Plan and will not be solicited.

2. Class 2 – Frontier Secured Claim 

x Classification: Class 2 consists of the Frontier Secured Claim. 

x Treatment: On or as soon as reasonably practicable after the Effective 

Date, each Holder of an Allowed Class 2 Claim will receive in full 

satisfaction, settlement, discharge and release of, and in exchange for, 

such Allowed Class 2 Claim: (A) Cash in an amount equal to all accrued 

but unpaid interest on the Frontier Claim through and including the 

Effective Date and (B) the New Frontier Note. The Holder of an Allowed 

Class 2 Claim will retain the Liens securing its Allowed Class 2 Claim as 

of the Effective Date until full and final payment of such Allowed Class 2 

Claim is made as provided herein. 

x Impairment and Voting: Class 2 is Impaired, and the Holders of Class 2

Claims are entitled to vote to accept or reject this Plan.

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001303

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3. Class 3 – Other Secured Claims 

x Classification: Class 3 consists of the Other Secured Claims. 

x Allowance and Treatment: On or as soon as reasonably practicable after 

the later of (i) the Initial Distribution Date if such Class 3 Claim is 

Allowed on the Effective Date or (ii) the date on which such Class 3 

Claim becomes an Allowed Class 3 Claim, each Holder of an Allowed 

Class 3 Claim will receive in full satisfaction, settlement, discharge and 

release of, and in exchange for, its Allowed Claim 3 Claim, at the option 

of the Debtor, or following the Effective Date, the Reorganized Debtor or 

Claimant Trustee, as applicable, (i) Cash equal to such Allowed Other 

Secured Claim, (ii) the collateral securing its Allowed Other Secured 

Claim, plus postpetition interest to the extent required under Bankruptcy 

Code Section 506(b), or (iii) such other treatment rendering such Claim 

Unimpaired. 

x Impairment and Voting: Class 3 is Unimpaired, and the Holders of Class 

3 Claims are conclusively deemed to have accepted this Plan pursuant to 

section 1126(f) of the Bankruptcy Code. Therefore, the Holders of Class 3 

Claims are not entitled to vote to accept or reject this Plan and will not be 

solicited.

4. Class 4 – Priority Non-Tax Claims 

x Classification: Class 4 consists of the Priority Non-Tax Claims. 

x Allowance and Treatment: On or as soon as reasonably practicable after 

the later of (i) the Initial Distribution Date if such Class 4 Claim is 

Allowed on the Effective Date or (ii) the date on which such Class 4 

Claim becomes an Allowed Class 4 Claim, each Holder of an Allowed 

Class 4 Claim will receive in full satisfaction, settlement, discharge and 

release of, and in exchange for, its Allowed Claim 4 Claim Cash equal to 

the amount of such Allowed Class 4 Claim. 

x Impairment and Voting: Class 4 is Unimpaired, and the Holders of Class 

4 Claims are conclusively deemed to have accepted this Plan pursuant to 

section 1126(f) of the Bankruptcy Code. Therefore, the Holders of Class 4 

Claims are not entitled to vote to accept or reject this Plan and will not be 

solicited.

5. Class 5 – Retained Employee Claims 

x Classification: Class 5 consists of the Retained Employee Claims. 

x Allowance and Treatment: On or as soon as reasonably practicable after 

the Effective Date, each Allowed Class 5 Claim will be Reinstated. 

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001304

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x Impairment and Voting: Class 5 is Unimpaired, and the Holders of Class 

5 Claims are conclusively deemed to have accepted this Plan pursuant to 

section 1126(f) of the Bankruptcy Code. Therefore, the Holders of Class 5 

Claims are not entitled to vote to accept or reject this Plan and will not be 

solicited.

6. Class 6 – PTO Claims

x Classification: Class 6 consists of the PTO Claims.

x Allowance and Treatment: On or as soon as reasonably practicable after 

the later of (i) the Initial Distribution Date if such Class 6 Claim is 

Allowed on the Effective Date or (ii) the date on which such Class 6 

Claim becomes an Allowed Class 6 Claim, each Holder of an Allowed 

Class 6 Claim will receive in full satisfaction, settlement, discharge and 

release of, and in exchange for, its Allowed Claim 6 Claim Cash equal to 

the amount of such Allowed Class 6 Claim. 

x Impairment and Voting: Class 6 is Unimpaired, and the Holders of Class 

6 Claims are conclusively deemed to have accepted this Plan pursuant to 

section 1126(f) of the Bankruptcy Code. Therefore, the Holders of Class 6 

Claims are not entitled to vote to accept or reject this Plan and will not be 

solicited.

7. Class 7 – Convenience Claims 

x Classification: Class 7 consists of the Convenience Claims. 

x Allowance and Treatment: On or as soon as reasonably practicable after 

the later of (i) the Initial Distribution Date if such Class 7 Claim is 

Allowed on the Effective Date or (ii) the date on which such Class 7 

Claim becomes an Allowed Class 7 Claim, each Holder of an Allowed 

Class 7 Claim will receive in full satisfaction, settlement, discharge and 

release of, and in exchange for, its Allowed Class 7 Claim (1) the 

treatment provided to Allowed Holders of Class 8 General Unsecured 

Claims if the Holder of such Class 7 Claim makes the GUC Election or (2) 

an amount in Cash equal to the lesser of (a) 85% of the Allowed amount 

of such Holder’s Class 7 Claim or (b) such Holder’s Pro Rata share of the 

Convenience Claims Cash Pool. 

x Impairment and Voting: Class 7 is Impaired, and the Holders of Class 7 

Claims are entitled to vote to accept or reject this Plan.

8. Class 8 – General Unsecured Claims 

x Classification: Class 8 consists of the General Unsecured Claims.

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001305

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x Treatment: On or as soon as reasonably practicable after the Effective 

Date, each Holder of an Allowed Class 8 Claim, in full satisfaction, 

settlement, discharge and release of, and in exchange for, such Claim shall 

receive (i) its Pro Rata share of the Claimant Trust Interests, (ii) such other 

less favorable treatment as to which such Holder and the Claimant Trustee 

shall have agreed upon in writing, or (iii) the treatment provided to 

Allowed Holders of Class 7 Convenience Claims if the Holder of such 

Class 8 General Unsecured Claim is eligible and makes a valid

Convenience Class Election. 

Notwithstanding anything to the contrary herein, after the Effective Date 

and subject to the other provisions of this Plan, the Debtor, the 

Reorganized Debtor, and the Claimant Trust, as applicable, will have and 

will retain any and all rights and defenses under bankruptcy or 

nonbankruptcy law that the Debtor had with respect to any General 

Unsecured Claim, except with respect to any General Unsecured Claim 

Allowed by Final Order of the Bankruptcy Court. 

x Impairment and Voting: Class 8 is Impaired, and the Holders of Class 8 

Claims are entitled to vote to accept or reject this Plan.

9. Class 9 – Subordinated Claims 

x Classification: Class 9 consists of the Subordinated Claims. 

Treatment: On the Effective Date, Holders of Subordinated Claims shall 

receive either (i) their Pro Rata share of the Subordinated Claimant Trust 

Interests or, (ii) such other less favorable treatment as to which such 

Holder and the Claimant Trustee may agree upon in writing. 

Notwithstanding anything to the contrary herein, after the Effective Date 

and subject to the other provisions of this Plan, the Debtor, the 

Reorganized Debtor, and the Claimant Trust, as applicable, will have and 

will retain any and all rights and defenses under bankruptcy or 

nonbankruptcy law that the Debtor had with respect to any Subordinated 

Claim, except with respect to any Subordinated Claim Allowed by Final 

Order of the Bankruptcy Court. 

x Impairment and Voting: Class 9 is Impaired, and the Holders of Class 9 

Claims are entitled to vote to accept or reject this Plan.

10. Class 10 – Class B/C Limited Partnership Interests 

x Classification: Class 10 consists of the Class B/C Limited Partnership 

Interests.

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001306

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x Treatment: On or as soon as reasonably practicable after the Effective 

Date, each Holder of an Allowed Class 10 Claim, in full satisfaction, 

settlement, discharge and release of, and in exchange for, such Claim shall 

receive (i) its Pro Rata share of the Contingent Claimant Trust Interests or 

(ii) such other less favorable treatment as to which such Holder and the 

Claimant Trustee shall have agreed upon in writing. 

Notwithstanding anything to the contrary herein, after the Effective Date 

and subject to the other provisions of this Plan, the Debtor, the 

Reorganized Debtor, and the Claimant Trust, as applicable, will have and 

will retain any and all rights and defenses under bankruptcy or 

nonbankruptcy law that the Debtor had with respect to any Class B/C 

Limited Partnership Interest Claim, except with respect to any Class B/C 

Limited Partnership Interest Claim Allowed by Final Order of the 

Bankruptcy Court. 

x Impairment and Voting: Class 10 is Impaired, and the Holders of Class 10 

Claims are entitled to vote to accept or reject this Plan.

11. Class 11 – Class A Limited Partnership Interests 

x Classification: Class 11 consists of the Class A Limited Partnership 

Interests.

x Treatment: On or as soon as reasonably practicable after the Effective 

Date, each Holder of an Allowed Class 11 Claim, in full satisfaction, 

settlement, discharge and release of, and in exchange for, such Claim shall 

receive (i) its Pro Rata share of the Contingent Claimant Trust Interests or 

(ii) such other less favorable treatment as to which such Holder and the 

Claimant Trustee shall have agreed upon in writing. 

Notwithstanding anything to the contrary herein, after the Effective Date 

and subject to the other provisions of this Plan, the Debtor, the 

Reorganized Debtor, and the Claimant Trust, as applicable, will have and 

will retain any and all rights and defenses under bankruptcy or 

nonbankruptcy law that the Debtor had with respect to any Class A 

Limited Partnership Interest, except with respect to any Class A Limited 

Partnership Interest Allowed by Final Order of the Bankruptcy Court. 

x Impairment and Voting: Class 11 is Impaired, and the Holders of Class 11 

Claims are entitled to vote to accept or reject this Plan.

I. Special Provision Governing Unimpaired Claims 

Except as otherwise provided in the Plan, nothing under the Plan will affect the Debtor’s 

rights in respect of any Unimpaired Claims, including, without limitation, all rights in respect of 

legal and equitable defenses to or setoffs or recoupments against any such Unimpaired Claims. 

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001307

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J. Subordinated Claims

The allowance, classification, and treatment of all Claims under the Plan shall take into 

account and conform to the contractual, legal, and equitable subordination rights relating thereto, 

whether arising under general principles of equitable subordination, section 510(b) of the 

Bankruptcy Code, or otherwise. Under section 510 of the Bankruptcy Code, upon written notice

and hearing, the Debtor the Reorganized Debtor, and the Claimant Trustee reserve the right to 

seek entry of an order by the Bankruptcy Court to re-classify or to subordinate any Claim in 

accordance with any contractual, legal, or equitable subordination relating thereto, and the 

treatment afforded any Claim under the Plan that becomes a subordinated Claim at any time shall 

be modified to reflect such subordination. 

ARTICLE IV.

MEANS FOR IMPLEMENTATION OF THIS PLAN

A. Summary

As discussed in the Disclosure Statement, the Plan will be implemented through (i) the 

Claimant Trust, (ii) the Litigation Sub-Trust, and (iii) the Reorganized Debtor. 

On the Effective Date, all Class A Limited Partnership Interests, including the Class A 

Limited Partnership Interests held by Strand, as general partner, and Class B/C Limited 

Partnerships in the Debtor will be cancelled, and new Class A Limited Partnership Interests in 

the Reorganized Debtor will be issued to the Claimant Trust and New GP LLC – a newlychartered limited liability company wholly-owned by the Claimant Trust. The Claimant Trust, 

as limited partner, will ratify New GP LLC’s appointment as general partner of the Reorganized 

Debtor, and on and following the Effective Date, the Claimant Trust will be the Reorganized 

Debtor’s limited partner and New GP LLC will be its general partner. The Claimant Trust, as 

limited partner, and New GP LLC, as general partner, will execute the Reorganized Limited 

Partnership Agreement, which will amend and restate, in all respects, the Debtor’s current 

Limited Partnership Agreement. Following the Effective Date, the Reorganized Debtor will be 

managed consistent with the terms of the Reorganized Limited Partnership Agreement by New 

GP LLC. The sole managing member of New GP LLC will be the Claimant Trust, and the 

Claimant Trustee will be the sole officer of New GP LLC on the Effective Date. 

Following the Effective Date, the Claimant Trust will administer the Claimant Trust 

Assets pursuant to this Plan and the Claimant Trust Agreement, and the Litigation Trustee will 

pursue, if applicable, the Estate Claims pursuant to the terms of the Litigation Sub-Trust 

Agreement and the Plan. The Reorganized Debtor will administer the Reorganized Debtor 

Assets and, if needed, with the utilization of a Sub-Servicer, which administration will include, 

among other things, managing the wind down of the Managed Funds. 

Although the Reorganized Debtor will manage the wind down of the Managed Funds, it 

is currently anticipated that neither the Reorganized Debtor nor the Claimant Trust will assume 

or assume and assign the contracts between the Debtor and certain Related Entities pursuant to 

which the Debtor provides shared services and sub-advisory services to those Related Entities. 

The Debtor believes that the continued provision of the services under such contracts will not be 

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001308

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cost effective. 

The Reorganized Debtor will distribute all proceeds from the wind down to the Claimant 

Trust, as its limited partner, and New GP LLC, as its general partner, in each case in accordance 

with the Reorganized Limited Partnership Agreement. Such proceeds, along with the proceeds 

of the Claimant Trust Assets, will ultimately be distributed to the Claimant Trust Beneficiaries as 

set forth in this Plan and the Claimant Trust Agreement. 

B. The Claimant Trust2

1. Creation and Governance of the Claimant Trust and Litigation Sub-Trust. 

On or prior to the Effective Date, the Debtor and the Claimant Trustee shall execute the 

Claimant Trust Agreement and shall take all steps necessary to establish the Claimant Trust and 

the Litigation Sub-Trust in accordance with the Plan in each case for the benefit of the Claimant 

Trust Beneficiaries. Additionally, on or prior to the Effective Date, the Debtor shall irrevocably 

transfer and shall be deemed to have irrevocably transferred to the Claimant Trust all of its 

rights, title, and interest in and to all of the Claimant Trust Assets, and in accordance with section 

1141 of the Bankruptcy Code, the Claimant Trust Assets shall automatically vest in the Claimant 

Trust free and clear of all Claims, Liens, encumbrances, or interests subject only to the Claimant 

Trust Interests and the Claimant Trust Expenses, as provided for in the Claimant Trust 

Agreement, and such transfer shall be exempt from any stamp, real estate transfer, mortgage 

from any stamp, transfer, reporting, sales, use, or other similar tax. 

The Claimant Trustee shall be the exclusive trustee of the Claimant Trust Assets, 

excluding the Estate Claims and the Litigation Trustee shall be the exclusive trustee with respect 

to the Estate Claims in each case for purposes of 31 U.S.C. § 3713(b) and 26 U.S.C. § 

6012(b)(3), as well as the representative of the Estate appointed pursuant to section 

1123(b)(3)(B) of the Bankruptcy Code with respect to the Claimant Trust Assets. The Claimant 

Trustee shall also be responsible for resolving all Claims and Equity Interests in Class 8 through 

Class 11, under the supervision of the Claimant Trust Oversight Committee. 

On the Effective Date, the Claimant Trustee and Litigation Trustee shall execute the 

Litigation Sub-Trust Agreement and shall take all steps necessary to establish the Litigation SubTrust. Upon the creation of the Litigation Sub-Trust, the Claimant Trust shall irrevocably 

transfer and assign to the Litigation Sub-Trust the Estate Claims. The Claimant Trust shall be 

governed by the Claimant Trust Agreement and administered by the Claimant Trustee. The 

powers, rights, and responsibilities of the Claimant Trustee shall be specified in the Claimant 

Trust Agreement and shall include the authority and responsibility to, among other things, take 

the actions set forth in this ARTICLE IV, subject to any required reporting to the Claimant Trust 

Oversight Committee as may be set forth in the Claimant Trust Agreement. The Claimant Trust 

shall hold and distribute the Claimant Trust Assets (including the proceeds from the Estate 

Claims, if any) in accordance with the provisions of the Plan and the Claimant Trust Agreement;

provided that the Claimant Trust Oversight Committee may direct the Claimant Trust to reserve 

2 In the event of a conflict between the terms of this summary and the terms of the Claimant Trust Agreement and 

the Litigation Sub-Trust Agreement, the terms of the Claimant Trust Agreement or the Litigation Sub-Trust 

Agreement, as applicable, shall control. 

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001309

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Cash from distributions as necessary to fund the Claimant Trust and Litigation Sub-Trust. Other 

rights and duties of the Claimant Trustee and the Claimant Trust Beneficiaries shall be as set 

forth in the Claimant Trust Agreement. After the Effective Date, neither the Debtor nor the 

Reorganized Debtor shall have any interest in the Claimant Trust Assets. 

The Litigation Sub-Trust shall be governed by the Litigation Sub-Trust Agreement and 

administered by the Litigation Trustee. The powers, rights, and responsibilities of the Litigation 

Trustee shall be specified in the Litigation Sub-Trust Agreement and shall include the authority 

and responsibility to, among other things, take the actions set forth in this ARTICLE IV, subject 

to any required reporting as may be set forth in the Litigation Sub-Trust Agreement. The

Litigation Sub-Trust shall investigate, prosecute, settle, or otherwise resolve the Estate Claims in 

accordance with the provisions of the Plan and the Litigation Sub-Trust Agreement and shall 

distribute the proceeds therefrom to the Claimant Trust for distribution. Other rights and duties 

of the Litigation Trustee shall be as set forth in the Litigation Sub-Trust Agreement. 

2. Claimant Trust Oversight Committee

The Claimant Trust, the Claimant Trustee, the management and monetization of the 

Claimant Trust Assets, and the management of the Reorganized Debtor (through the Claimant 

Trust’s role as managing member of New GP LLC) and the Litigation Sub-Trust will be 

overseen by the Claimant Trust Oversight Committee, subject to the terms of the Claimant Trust 

Agreement and the Litigation Sub-Trust Agreement, as applicable. 

The Claimant Trust Oversight Committee will initially consist of five members. Four of 

the five members will be representatives of the members of the Committee: (i) the Redeemer 

Committee of Highland Crusader Fund, (ii) UBS, (iii) Acis, and (iv) Meta-e Discovery. The 

fifth member will be an independent, natural Person chosen by the Committee and reasonably 

acceptable to the Debtor. The members of the Claimant Trust Oversight Committee may be 

replaced as set forth in the Claimant Trust Agreement. The identity of the members of the 

Claimant Trust Oversight Committee will be disclosed in the Plan Supplement. 

As set forth in the Claimant Trust Agreement, in no event will any member of the 

Claimant Trust Oversight Committee with a Claim against the Estate be entitled to vote, opine, 

or otherwise be involved in any matters related to such member’s Claim.

The independent member(s) of the Claimant Trust Oversight Committee may be entitled 

to compensation for their services as set forth in the Claimant Trust Agreement. Any member of 

the Claimant Trust Oversight Committee may be removed, and successor chosen, in the manner 

set forth in the Claimant Trust Agreement. 

3. Purpose of the Claimant Trust. 

The Claimant Trust shall be established for the purpose of (i) managing and monetizing 

the Claimant Trust Assets, subject to the terms of the Claimant Trust Agreement and the 

oversight of the Claimant Trust Oversight Committee, (ii) serving as the limited partner of, and 

holding the limited partnership interests in, the Reorganized Debtor, (iii) serving as the sole 

member and manager of New GP LLC, the Reorganized Debtor’s general partner, (iv) in its 

capacity as the sole member and manager of New GP LLC, overseeing the management and 

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001310

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monetization of the Reorganized Debtor Assets pursuant to the terms of the Reorganized Limited 

Partnership Agreement; and (v) administering the Disputed Claims Reserve and serving as 

Distribution Agent with respect to Disputed Claims in Class 7 or Class 8. 

In its management of the Claimant Trust Assets, the Claimant Trust will also reconcile 

and object to the General Unsecured Claims, Subordinated Claims, Class B/C Limited 

Partnership Interests, and Class A Limited Partnership Interests, as provided for in this Plan and 

the Claimant Trust Agreement, and make Trust Distributions to the Claimant Trust Beneficiaries 

in accordance with Treasury Regulation section 301.7701-4(d), with no objective to continue or 

engage in the conduct of a trade or business. 

The purpose of the Reorganized Debtor is discussed at greater length in ARTICLE IV.C. 

4. Purpose of the Litigation Sub-Trust. 

The Litigation Sub-Trust shall be established for the purpose of investigating, 

prosecuting, settling, or otherwise resolving the Estate Claims. Any proceeds therefrom shall be 

distributed by the Litigation Sub-Trust to the Claimant Trust for distribution to the Claimant 

Trust Beneficiaries pursuant to the terms of the Claimant Trust Agreement. 

5. Claimant Trust Agreement and Litigation Sub-Trust Agreement. 

The Claimant Trust Agreement generally will provide for, among other things: 

(i) the payment of the Claimant Trust Expenses; 

(ii) the payment of other reasonable expenses of the Claimant Trust; 

(iii) the retention of employees, counsel, accountants, financial advisors, or other 

professionals and the payment of their reasonable compensation; 

(iv) the investment of Cash by the Claimant Trustee within certain limitations, 

including those specified in the Plan; 

(v) the orderly monetization of the Claimant Trust Assets;

(vi) litigation of any Causes of Action, which may include the prosecution, 

settlement, abandonment, or dismissal of any such Causes of Action, subject to reporting and 

oversight by the Claimant Trust Oversight Committee; 

(vii) the resolution of Claims and Equity Interests in Class 8 through Class 11,

subject to reporting and oversight by the Claimant Trust Oversight Committee; 

(viii) the administration of the Disputed Claims Reserve and distributions to be 

made therefrom; and 

(ix) the management of the Reorganized Debtor, including the utilization of a SubServicer, with the Claimant Trust serving as the managing member of New GP LLC. 

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001311

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Except as otherwise ordered by the Bankruptcy Court, the Claimant Trust Expenses shall

be paid from the Claimant Trust Assets in accordance with the Plan and Claimant Trust 

Agreement. The Claimant Trustee may establish a reserve for the payment of Claimant Trust 

Expense (including, without limitation, any reserve for potential indemnification claims as 

authorized and provided under the Claimant Trust Agreement), and shall periodically replenish 

such reserve, as necessary. 

In furtherance of, and consistent with the purpose of, the Claimant Trust and the Plan, the 

Trustees, for the benefit of the Claimant Trust, shall, subject to reporting and oversight by the 

Claimant Trust Oversight Committee as set forth in the Claimant Trust Agreement: (i) hold the 

Claimant Trust Assets for the benefit of the Claimant Trust Beneficiaries, (ii) make Distributions 

to the Claimant Trust Beneficiaries as provided herein and in the Claimant Trust Agreement, and 

(iii) have the sole power and authority to prosecute and resolve any Causes of Action and 

objections to Claims and Equity Interests (other than those assigned to the Litigation Sub-Trust),

without approval of the Bankruptcy Court. Except as otherwise provided in the Claimant Trust 

Agreement, the Claimant Trustee shall be responsible for all decisions and duties with respect to 

the Claimant Trust and the Claimant Trust Assets; provided, however, that the prosecution and 

resolution of any Estate Claims included in the Claimant Trust Assets shall be the responsibility 

of the Litigation Trustee. The Litigation Sub-Trust Agreement generally will provide for, among 

other things: 

(i) the payment of other reasonable expenses of the Litigation Sub-Trust;

(ii) the retention of employees, counsel, accountants, financial advisors, or other 

professionals and the payment of their reasonable compensation; and 

(iii) the investigation and prosecution of Estate Claims, which may include the 

prosecution, settlement, abandonment, or dismissal of any such Estate Claims, subject to 

reporting and oversight as set forth in the Litigation Sub-Trust Agreement.

The Trustees, on behalf of the Claimant Trust and Litigation Sub-Trust, as applicable, 

may each employ, without further order of the Bankruptcy Court, employees and other 

professionals (including those previously retained by the Debtor and the Committee) to assist in 

carrying out the Trustees’ duties hereunder and may compensate and reimburse the reasonable 

expenses of these professionals without further Order of the Bankruptcy Court from the Claimant 

Trust Assets in accordance with the Plan and the Claimant Trust Agreement. 

The Claimant Trust Agreement and Litigation Sub-Trust Agreement may include 

reasonable and customary provisions that allow for indemnification by the Claimant Trust in 

favor of the Claimant Trustee, Litigation Trustee, and the Claimant Trust Oversight Committee. 

Any such indemnification shall be the sole responsibility of the Claimant Trust and payable 

solely from the Claimant Trust Assets.

6. Compensation and Duties of Trustees. 

The salient terms of each Trustee’s employment, including such Trustee’s duties and 

compensation shall be set forth in the Claimant Trust Agreement and the Litigation Sub-Trust 

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001312

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Agreement, as appropriate. The Trustees shall each be entitled to reasonable compensation in an 

amount consistent with that of similar functionaries in similar types of bankruptcy cases.

7. Cooperation of Debtor and Reorganized Debtor. 

To effectively investigate, prosecute, compromise and/or settle the Claims and/or Causes 

of Action that constitute Claimant Trust Assets (including Estate Claims), the Claimant Trustee, 

Litigation Trustee, and each of their professionals may require reasonable access to the Debtor’s 

and Reorganized Debtor’s documents, information, and work product relating to the Claimant 

Trust Assets. Accordingly, the Debtor and the Reorganized Debtor, as applicable, shall 

reasonably cooperate with the Claimant Trustee and Litigation Trustee, as applicable, in their 

prosecution of Causes of Action and in providing the Claimant Trustee and Litigation Trustee 

with copies of documents and information in the Debtor’s possession, custody, or control on the 

Effective Date that either Trustee indicates relates to the Estate Claims or other Causes of 

Action. 

The Debtor and Reorganized Debtor shall preserve all records, documents or work 

product (including all electronic records, documents, or work product) related to the Claims and 

Causes of Action, including Estate Claims, until the earlier of (a) the dissolution of the 

Reorganized Debtor or (b) termination of the Claimant Trust and Litigation Sub-Trust.

8. United States Federal Income Tax Treatment of the Claimant Trust. 

Unless the IRS requires otherwise, for all United States federal income tax purposes, the 

parties shall treat the transfer of the Claimant Trust Assets to the Claimant Trust as: (a) a 

transfer of the Claimant Trust Assets (other than the amounts set aside in the Disputed Claims 

Reserve, if the Claimant Trustee makes the election described in Section 7 below) directly to the 

applicable Claimant Trust Beneficiaries followed by (b) the transfer by the such Claimant Trust 

Beneficiaries to the Claimant Trust of such Claimant Trust Assets in exchange for the Claimant 

Trust Interests. Accordingly, the applicable Claimant Trust Beneficiaries shall be treated for 

United States federal income tax purposes as the grantors and owners of their respective share of 

the Claimant Trust Assets. The foregoing treatment shall also apply, to the extent permitted by 

applicable law, for state and local income tax purposes.

9. Tax Reporting. 

(a) The Claimant Trustee shall file tax returns for the Claimant Trust treating the 

Claimant Trust as a grantor trust pursuant to Treasury Regulation section 1.671-4(a). The 

Claimant Trustee may file an election pursuant to Treasury Regulation 1.468B-9(c) to treat the 

Disputed Claims Reserve as a disputed ownership fund, in which case the Claimant Trustee will 

file federal income tax returns and pay taxes for the Disputed Claims Reserve as a separate 

taxable entity.

(b) The Claimant Trustee shall be responsible for payment, out of the Claimant Trust 

Assets, of any taxes imposed on the Claimant Trust or its assets. 

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001313

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(c) The Claimant Trustee shall determine the fair market value of the Claimant Trust 

Assets as of the Effective Date and notify the applicable Claimant Trust Beneficiaries of such 

valuation, and such valuation shall be used consistently for all federal income tax purposes. 

(d) The Claimant Trustee shall distribute such tax information to the applicable Claimant 

Trust Beneficiaries as the Claimant Trustee determines is required by applicable law. 

10. Claimant Trust Assets. 

The Claimant Trustee shall have the exclusive right, on behalf of the Claimant Trust, to 

institute, file, prosecute, enforce, abandon, settle, compromise, release, or withdraw any and all 

Causes of Action included in the Claimant Trust Assets (except for the Estate Claims) without 

any further order of the Bankruptcy Court, and the Claimant Trustee shall have the exclusive 

right, on behalf of the Claimant Trust, to sell, liquidate, or otherwise monetize all Claimant Trust 

Assets, except as otherwise provided in this Plan or in the Claimant Trust Agreement, without 

any further order of the Bankruptcy Court. Notwithstanding anything herein to the contrary, the 

Litigation Trustee shall have the exclusive right to institute, file, prosecute, enforce, abandon, 

settle, compromise, release, or withdraw any and all Estate Claims included in the Claimant 

Trust Assets without any further order of the Bankruptcy Court. 

From and after the Effective Date, the Trustees, in accordance with section 1123(b)(3) 

and (4) of the Bankruptcy Code, and on behalf of the Claimant Trust, shall each serve as a 

representative of the Estate with respect to any and all Claimant Trust Assets, including the 

Causes of Action and Estate Claims, as appropriate, and shall retain and possess the right to (a) 

commence, pursue, settle, compromise, or abandon, as appropriate, any and all Causes of Action 

in any court or other tribunal and (b) sell, liquidate, or otherwise monetize all Claimant Trust 

Assets.

11. Claimant Trust Expenses. 

From and after the Effective Date, the Claimant Trust shall, in the ordinary course of 

business and without the necessity of any approval by the Bankruptcy Court, pay the reasonable 

professional fees and expenses incurred by the Claimant Trust, the Litigation Sub-Trust, and any 

professionals retained by such parties and entities from the Claimant Trust Assets, except as 

otherwise provided in the Claimant Trust Agreement. 

12. Trust Distributions to Claimant Trust Beneficiaries. 

The Claimant Trustee, in its discretion, may make Trust Distributions to the Claimant 

Trust Beneficiaries at any time and/or use the Claimant Trust Assets or proceeds thereof, 

provided that such Trust Distributions or use is otherwise permitted under the terms of the Plan, 

the Claimant Trust Agreement, and applicable law.

13. Cash Investments. 

With the consent of the Claimant Trust Oversight Committee, the Claimant Trustee may 

invest Cash (including any earnings thereon or proceeds therefrom) in a manner consistent with 

the terms of the Claimant Trust Agreement; provided, however, that such investments are 

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001314

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investments permitted to be made by a “liquidating trust” within the meaning of Treasury 

Regulation section 301.7701-4(d), as reflected therein, or under applicable IRS guidelines, 

rulings or other controlling authorities. 

14. Dissolution of the Claimant Trust and Litigation Sub-Trust. 

The Trustees and the Claimant Trust and Litigation Sub-Trust shall be discharged or 

dissolved, as the case may be, at such time as: (a) the Litigation Trustee determines that the 

pursuit of Estate Claims is not likely to yield sufficient additional proceeds to justify further 

pursuit of such Estate Claims, (b) the Claimant Trustee determines that the pursuit of Causes of 

Action (other than Estate Claims) is not likely to yield sufficient additional proceeds to justify 

further pursuit of such Causes of Action, (c) the Clamant Trustee determines that the pursuit of 

sales of other Claimant Trust Assets is not likely to yield sufficient additional proceeds to justify 

further pursuit of such sales of Claimant Trust Assets, (d) all objections to Disputed Claims and 

Equity Interests are fully resolved, (e) the Reorganized Debtor is dissolved, and (f) all 

Distributions required to be made by the Claimant Trustee to the Claimant Trust Beneficiaries 

under the Plan have been made, but in no event shall the Claimant Trust be dissolved later than 

three years from the Effective Date unless the Bankruptcy Court, upon motion made within the 

six-month period before such third anniversary (and, in the event of further extension, by order 

of the Bankruptcy Court, upon motion made at least six months before the end of the preceding 

extension), determines that a fixed period extension (not to exceed two years, together with any 

prior extensions, without a favorable letter ruling from the Internal Revenue Service or an 

opinion of counsel that any further extension would not adversely affect the status of the 

Claimant Trust as a liquidating trust for federal income tax purposes) is necessary to facilitate or 

complete the recovery on, and liquidation of, the Claimant Trust Assets; provided, however, that 

each extension must be approved, upon a finding that the extension is necessary to facilitate or 

complete the recovery on, and liquidation of the Claimant Trust Assets, by the Bankruptcy Court 

within 6 months of the beginning of the extended term and no extension, together with any prior 

extensions, shall exceed three years without a favorable letter ruling from the Internal Revenue 

Service or an opinion of counsel that any further extension would not adversely affect the status 

of the Claimant Trust as a liquidating trust for federal income tax purposes. 

Upon dissolution of the Claimant Trust, and pursuant to the Claimant Trust Agreement, 

any remaining Claimant Trust Assets that exceed the amounts required to be paid under the Plan 

will be transferred (in the sole discretion of the Claimant Trustee) in Cash or in-kind to the 

Holders of the Claimant Trust Interests as provided in the Claimant Trust Agreement. 

C. The Reorganized Debtor

1. Corporate Existence 

The Debtor will continue to exist after the Effective Date, with all of the powers of 

partnerships pursuant to the law of the State of Delaware and as set forth in the Reorganized 

Limited Partnership Agreement. 

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001315

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2. Cancellation of Equity Interests and Release 

On the Effective Date, (i) all prepetition Equity Interests, including the Class A Limited 

Partnership Interests and the Class B/C Limited Partnership Interests, in the Debtor shall be 

canceled, and (ii) all obligations or debts owed by, or Claims against, the Debtor on account of, 

or based upon, the Interests shall be deemed as cancelled, released, and discharged, including all 

obligations or duties by the Debtor relating to the Equity Interests in any of the Debtor’s 

formation documents, including the Limited Partnership Agreement.

3. Issuance of New Partnership Interests 

On the Effective Date, the Debtor or the Reorganized Debtor, as applicable, will issue 

new Class A Limited Partnership Interests to (i) the Claimant Trust, as limited partner, and (ii) 

New GP LLC, as general partner, and will admit (a) the Claimant Trust as the limited partner of 

the Reorganized Debtor, and (b) New GP LLC as the general partner of the Reorganized Debtor. 

The Claimant Trust, as limited partner, will ratify New GP LLC’s appointment as general partner 

of the Reorganized Debtor. Also, on the Effective Date, the Claimant Trust, as limited partner, 

and New GP LLC, as general partner, will execute the Reorganized Limited Partnership 

Agreement and receive partnership interests in the Reorganized Debtor consistent with the terms 

of the Reorganized Limited Partnership Agreement. 

The Reorganized Limited Partnership Agreement does not provide for, and specifically 

disclaims, the indemnification obligations under the Limited Partnership Agreement, including 

any such indemnification obligations that accrued or arose or could have been brought prior to 

the Effective Date. Any indemnification Claims under the Limited Partnership Agreement that 

accrued, arose, or could have been filed prior to the Effective Date will be resolved through the 

Claims resolution process provided that a Claim is properly filed in accordance with the 

Bankruptcy Code, the Plan, or the Bar Date Order. Each of the Debtor, the Reorganized Debtor, 

the Claimant Trust, and the Litigation Sub-Trust reserve all rights with respect to any such 

indemnification Claims.

4. Management of the Reorganized Debtor 

Subject to and consistent with the terms of the Reorganized Limited Partnership 

Agreement, the Reorganized Debtor shall be managed by its general partner, New GP LLC. The 

initial officers and employees of the Reorganized Debtor shall be selected by the Claimant 

Trustee. The Reorganized Debtor may, in its discretion, also utilize a Sub-Servicer in addition to 

or in lieu of the retention of officers and employees. 

As set forth in the Reorganized Limited Partnership Agreement, New GP LLC will 

receive a fee for managing the Reorganized Debtor. Although New GP LLC will be a limited 

liability company, it will elect to be treated as a C-Corporation for tax purposes. Therefore, New 

GP LLC (and any taxable income attributable to it) will be subject to corporate income taxation 

on a standalone basis, which may reduce the return to Claimants. 

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001316

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5. Vesting of Assets in the Reorganized Debtor 

Except as otherwise provided in this Plan or the Confirmation Order, on or after the 

Effective Date, all Reorganized Debtor Assets will vest in the Reorganized Debtor, free and clear 

of all Liens, Claims, charges or other encumbrances pursuant to section 1141(c) of the 

Bankruptcy Code except with respect to such Liens, Claims, charges and other encumbrances 

that are specifically preserved under this Plan upon the Effective Date. 

The Reorganized Debtor shall be the exclusive trustee of the Reorganized Debtor Assets 

for purposes of 31 U.S.C. § 3713(b) and 26 U.S.C. § 6012(b)(3), as well as the representative of 

the Estate appointed pursuant to section 1123(b)(3)(B) of the Bankruptcy Code with respect to 

the Reorganized Debtor Assets. 

6. Purpose of the Reorganized Debtor 

Except as may be otherwise provided in this Plan or the Confirmation Order, the 

Reorganized Debtor will continue to manage the Reorganized Debtor Assets (which shall 

include, for the avoidance of doubt, serving as the investment manager of the Managed Funds) 

and may use, acquire or dispose of the Reorganized Debtor Assets and compromise or settle any 

Claims with respect to the Reorganized Debtor Assets without supervision or approval by the 

Bankruptcy Court and free of any restrictions of the Bankruptcy Code or Bankruptcy Rules. The 

Reorganized Debtor shall oversee the resolution of Claims in Class 1 through Class 7. 

Without limiting the foregoing, the Reorganized Debtor will pay the charges that it incurs 

after the Effective Date for Professionals’ fees, disbursements, expenses or related support 

services (including reasonable fees relating to the preparation of Professional fee applications) in 

the ordinary course of business and without application or notice to, or order of, the Bankruptcy

Court. 

7. Distribution of Proceeds from the Reorganized Debtor Assets; Transfer of 

Reorganized Debtor Assets 

Any proceeds received by the Reorganized Debtor will be distributed to the Claimant 

Trust, as limited partner, and New GP LLC, as general partner, in the manner set forth in the 

Reorganized Limited Partnership Agreement. As set forth in the Reorganized Limited 

Partnership Agreement, the Reorganized Debtor may, from time to time distribute Reorganized 

Debtor Assets to the Claimant Trust either in Cash or in-kind, including to institute the winddown and dissolution of the Reorganized Debtor. Any assets distributed to the Claimant Trust 

will be (i) deemed transferred in all respects as forth in ARTICLE IV.B.1, (ii) deemed Claimant 

Trust Assets, and (iii) administered as Claimant Trust Assets. 

D. Company Action 

Each of the Debtor, the Reorganized Debtor, and the Trustees, as applicable, may take 

any and all actions 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 implement the provisions of this Plan, the Claimant Trust Agreement, the 

Reorganized Limited Partnership Agreement, or the New GP LLC Documents, as applicable, in 

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001317

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the name of and on behalf of the Debtor, the Reorganized Debtor, or the Trustees, as applicable, 

and in each case without further notice to or order of the Bankruptcy Court, act or action under 

applicable law, regulation, order, or rule or any requirement of further action, vote or other 

approval or authorization by the security holders, officers, or directors of the Debtor or the 

Reorganized Debtor, as applicable, or by any other Person. 

Prior to, on or after the Effective Date (as appropriate), all matters provided for pursuant 

to this Plan that would otherwise require approval of the stockholders, partners, directors, 

managers, or members of the Debtor, any Related Entity, or any Affiliate thereof (as of prior to 

the Effective Date) will be deemed to have been so approved and will be in effect prior to, on or 

after the Effective Date (as appropriate) pursuant to applicable law and without any requirement 

of further action by the stockholders, partners, directors, managers or members of such Persons, 

or the need for any approvals, authorizations, actions or consents of any Person. 

All matters provided for in this Plan involving the legal or corporate structure of the 

Debtor, the Reorganized Debtor, or the Claimant Trust, as applicable, and any legal or corporate 

action required by the Debtor, the Reorganized Debtor, or the Claimant Trust, as applicable, in 

connection with this Plan, will be deemed to have occurred and will be in full force and effect in 

all respects, in each case without further notice to or order of the Bankruptcy Court, act or action 

under applicable law, regulation, order, or rule or any requirement of further action, vote or other 

approval or authorization by the security holders, partners, directors, managers, or members of 

the Debtor, the Reorganized Debtor, or the Claimant Trust, as applicable, or by any other Person. 

On the Effective Date, the appropriate officers of the Debtor and the Reorganized Debtor, as 

applicable, as well as the Trustees, are authorized to issue, execute, deliver, and consummate the 

transactions contemplated by, the contracts, agreements, documents, guarantees, pledges, 

consents, securities, certificates, resolutions and instruments contemplated by or described in this 

Plan in the name of and on behalf of the Debtor and the Reorganized Debtor, as well as the 

Trustees, in each case without further notice to or order of the Bankruptcy Court, act or action 

under applicable law, regulation, order, or rule or any requirement of further action, vote or other 

approval or authorization by any Person. The appropriate officer of the Debtor, the Reorganized 

Debtor, as well as the Trustees, will be authorized to certify or attest to any of the foregoing 

actions.

E. Release of Liens, Claims and Equity Interests

Except as otherwise provided in the Plan or in any contract, instrument, release or other 

agreement or document entered into or delivered in connection with the Plan, from and after the 

Effective Date and concurrently with the applicable distributions made pursuant to the Plan, all 

Liens, Claims, Equity Interests, mortgages, deeds of trust, or other security interests against the 

property of the Estate will be fully released, terminated, extinguished and discharged, in each 

case without further notice to or order of the Bankruptcy Court, act or action under applicable 

law, regulation, order, or rule or the vote, consent, authorization or approval of any Entity. Any 

Entity holding such Liens or Equity Interests extinguished pursuant to the prior sentence will, 

pursuant to section 1142 of the Bankruptcy Code, promptly execute and deliver to the Debtor, 

the Reorganized Debtor, or the Claimant Trustee, as applicable, such instruments of termination, 

release, satisfaction and/or assignment (in recordable form) as may be reasonably requested by 

the Debtor, the Reorganized Debtor, or the Claimant Trustee, as applicable. For the avoidance of 

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001318

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doubt, this section is in addition to, and shall not be read to limit in any respects, ARTICLE 

IV.C.2.

F. Cancellation of Notes, Certificates and Instruments

Except for the purpose of evidencing a right to a distribution under this Plan and except 

as otherwise set forth in this Plan, on the Effective Date, all agreements, instruments, Securities 

and other documents evidencing any prepetition Claim or Equity Interest and any rights of any 

Holder in respect thereof shall be deemed cancelled, discharged, and of no force or effect. The 

holders of or parties to such cancelled instruments, Securities, and other documentation will have 

no rights arising from or related to such instruments, Securities, or other documentation or the 

cancellation thereof, except the rights provided for pursuant to this Plan, and the obligations of 

the Debtor thereunder or in any way related thereto will be fully released, terminated, 

extinguished and discharged, in each case without further notice to or order of the Bankruptcy 

Court, act or action under applicable law, regulation, order, or rule or any requirement of further 

action, vote or other approval or authorization by any Person. For the avoidance of doubt, this 

section is in addition to, and shall not be read to limit in any respects, ARTICLE IV.C.2.

G. Cancellation of Existing Instruments Governing Security Interests

Upon payment or other satisfaction of an Allowed Class 1 or Allowed Class 2 Claim, or 

promptly thereafter, the Holder of such Allowed Class 1 or Allowed Class 2 Claim shall deliver 

to the Debtor, the Reorganized Debtor, or the Claimant Trustee, as applicable, any collateral or 

other property of the Debtor held by such Holder, together with any termination statements, 

instruments of satisfaction, or releases of all security interests with respect to its Allowed Class 1 

or Allowed Class 2 Claim that may be reasonably required to terminate any related financing 

statements, mortgages, mechanics’ or other statutory Liens, or lis pendens, or similar interests or 

documents. 

H. Control Provisions 

To the extent that there is any inconsistency between this Plan as it relates to the 

Claimant Trust, the Claimant Trust Agreement, the Reorganized Debtor, or the Reorganized 

Limited Partnership Agreement, this Plan shall control. 

I. Treatment of Vacant Classes

Any Claim or Equity Interest in a Class considered vacant under ARTICLE III.C of this 

Plan shall receive no Plan Distributions. 

J. Plan Documents

The documents, if any, to be Filed as part of the Plan Documents, including any 

documents filed with the Plan Supplement, and any amendments, restatements, supplements, or 

other modifications to such documents, and any consents, waivers, or other deviations under or 

from any such documents, shall be incorporated herein by this reference (including to the 

applicable definitions in ARTICLE I hereof) and fully enforceable as if stated in full herein. 

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001319

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37

The Debtor and the Committee are currently working to finalize the forms of certain of 

the Plan Documents to be filed with the Plan Supplement. To the extent that the Debtor and the 

Committee cannot agree as to the form and content of such Plan Documents, they intend to 

submit the issue to non-binding mediation pursuant to the Order Directing Mediation entered on 

August 3, 2020 [D.I. 912]. 

K. Highland Capital Management, L.P. Retirement Plan and Trust

The Highland Capital Management, L.P. Retirement Plan And Trust (“Pension Plan”) is a 

single-employer defined benefit pension plan covered by Title IV of the Employee Retirement 

Income Security Act of 1974, as amended (“ERISA”). 29 U.S.C. §§ 1301-1461. The Debtor is 

the contributing sponsor and, as such, the PBGC asserts that the Debtor is liable along with any 

members of the contributing sponsor’s controlled-group within the meaning of 29 U.S.C. §§ 

1301(a)(13), (14) with respect to the Pension Plan. 

Upon the Effective Date, the Reorganized Debtor shall be deemed to have assumed the 

Pension Plan and shall comply with all applicable statutory provisions of ERISA and the Internal 

Revenue Code (the “IRC”), including, but not limited to, satisfying the minimum funding 

standards pursuant to 26 U.S.C. §§ 412, 430, and 29 U.S.C. §§ 1082, 1083; paying the PBGC 

premiums in accordance with 29 U.S.C. §§ 1306 and 1307; and administering the Pension Plan 

in accordance with its terms and the provisions of ERISA and the IRC. In the event that the 

Pension Plan terminates after the Plan of Reorganization Effective Date, the PBGC asserts that 

the Reorganized Debtor and each of its controlled group members will be responsible for the 

liabilities imposed by Title IV of ERISA. 

Notwithstanding any provision of the Plan, the Confirmation Order, or the Bankruptcy 

Code (including section 1141 thereof) to the contrary, neither the Plan, the Confirmation Order, 

or the Bankruptcy Code shall be construed as discharging, releasing, exculpating or relieving the 

Debtor, the Reorganized Debtor, or any person or entity in any capacity, from any liability or 

responsibility, if any, with respect to the Pension Plan under any law, governmental policy, or 

regulatory provision. PBGC and the Pension Plan shall not be enjoined or precluded from 

enforcing such liability or responsibility against any person or entity as a result of any of the 

provisions of the Plan, the Confirmation Order, or the Bankruptcy Code. The Debtor reserves 

the right to contest any such liability or responsibility. 

ARTICLE V.

TREATMENT OF EXECUTORY CONTRACTS AND UNEXPIRED LEASES

A. Assumption, Assignment, or Rejection of Executory Contracts and Unexpired 

Leases 

Unless an Executory Contract or Unexpired Lease: (i) was previously assumed or 

rejected by the Debtor pursuant to this Plan on or prior to the Confirmation Date; (ii) previously 

expired or terminated pursuant to its own terms or by agreement of the parties thereto; (iii) is the 

subject of a motion to assume filed by the Debtor on or before the Confirmation Date; (iv) 

contains a change of control or similar provision that would be triggered by the Chapter 11 Case 

(unless such provision has been irrevocably waived); or (v) is specifically designated as a 

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001320

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38

contract or lease to be assumed in the Plan or the Plan Supplement, on the Confirmation Date, 

each Executory Contract and Unexpired Lease shall be deemed rejected pursuant to section 365 

of the Bankruptcy Code, without the need for any further notice to or action, order, or approval 

of the Bankruptcy Court, unless such Executory Contract or Unexpired Lease is listed in the Plan 

Supplement. 

At any time on or prior to the Confirmation Date, the Debtor may (i) amend the Plan 

Supplement in order to add or remove a contract or lease from the list of contracts to be assumed 

or (ii) assign (subject to applicable law) any Executory Contract or Unexpired Lease, as 

determined by the Debtor in consultation with the Committee, or the Reorganized Debtor, as 

applicable.

The Confirmation Order will constitute an order of the Bankruptcy Court approving the 

above-described assumptions, rejections, and assumptions and assignments. Except as otherwise 

provided herein or agreed to by the Debtor and the applicable counterparty, each assumed 

Executory Contract or Unexpired Lease shall include all modifications, amendments, 

supplements, restatements, or other agreements related thereto, and all rights related thereto. 

Modifications, amendments, supplements, and restatements to prepetition Executory Contracts 

and Unexpired Leases that have been executed by the Debtor during the Chapter 11 Case shall 

not be deemed to alter the prepetition nature of the Executory Contract or Unexpired Lease or the 

validity, priority, or amount of any Claims that may arise in connection therewith. To the extent 

applicable, no change of control (or similar provision) will be deemed to occur under any such 

Executory Contract or Unexpired Lease. 

If certain, but not all, of a contract counterparty’s Executory Contracts and/or Unexpired 

Leases are rejected pursuant to the Plan, the Confirmation Order shall be a determination that 

such counterparty’s Executory Contracts and/or Unexpired Leases that are being assumed 

pursuant to the Plan are severable agreements that are not integrated with those Executory 

Contracts and/or Unexpired Leases that are being rejected pursuant to the Plan. Parties seeking 

to contest this finding with respect to their Executory Contracts and/or Unexpired Leases must 

file a timely objection to the Plan on the grounds that their agreements are integrated and not 

severable, and any such dispute shall be resolved by the Bankruptcy Court at the Confirmation 

Hearing (to the extent not resolved by the parties prior to the Confirmation Hearing). 

Notwithstanding anything herein to the contrary, the Debtor shall assume or reject that 

certain real property lease with Crescent TC Investors L.P. (“Landlord”) for the Debtor’s 

headquarters located at 200/300 Crescent Ct., Suite #700, Dallas, Texas 75201 (the “Lease”) in 

accordance with the notice to Landlord, procedures and timing required by 11 U.S.C. §365(d)(4), 

as modified by that certain Agreed Order Granting Motion to Extend Time to Assume or Reject 

Unexpired Nonresidential Real Property Lease [Docket No. 1122]. 

B. Claims Based on Rejection of Executory Contracts or Unexpired Leases 

Any Executory Contract or Unexpired Lease not assumed or rejected on or before the 

Confirmation Date shall be deemed rejected, pursuant to the Confirmation Order. Any Person 

asserting a Rejection Claim shall File a proof of claim within thirty days of the Effective Date.

Any Rejection Claims that are not timely Filed pursuant to this Plan shall be forever disallowed 

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001321

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39

and barred. If one or more Rejection Claims are timely Filed, the Claimant Trustee may File an 

objection to any Rejection Claim.

Rejection Claims shall be classified as General Unsecured Claims and shall be treated in 

accordance with ARTICLE III of this Plan. 

C. Cure of Defaults for Assumed or Assigned Executory Contracts and Unexpired 

Leases 

Any monetary amounts by which any Executory Contract or Unexpired Lease to be 

assumed or assigned hereunder is in default shall be satisfied, under section 365(b)(1) of the 

Bankruptcy Code, by the Debtor upon assumption or assignment thereof, by payment of the 

default amount in Cash as and when due in the ordinary course or on such other terms as the 

parties to such Executory Contracts may otherwise agree. The Debtor may serve a notice on the 

Committee and parties to Executory Contracts or Unexpired Leases to be assumed or assigned 

reflecting the Debtor’s or Reorganized Debtor’s intention to assume or assign the Executory 

Contract or Unexpired Lease in connection with this Plan and setting forth the proposed cure 

amount (if any). 

If a dispute regarding (1) the amount of any payments to cure a default, (2) the ability of 

the Debtor, the Reorganized Debtor, or any assignee to provide “adequate assurance of future 

performance” (within the meaning of section 365 of the Bankruptcy Code) under the Executory 

Contract or Unexpired Lease to be assumed or assigned or (3) any other matter pertaining to 

assumption or assignment, the cure payments required by section 365(b)(1) of the Bankruptcy 

Code will be made following the entry of a Final Order or orders resolving the dispute and 

approving the assumption or assignment. 

Assumption or assignment of any Executory Contract or Unexpired Lease pursuant to the 

Plan or otherwise and full payment of any applicable cure amounts pursuant to this ARTICLE 

V.C shall result in the full release and satisfaction of any cure amounts, Claims, or defaults, 

whether monetary or nonmonetary, including defaults of provisions restricting the change in 

control or ownership interest composition or other bankruptcy-related defaults, arising under any 

assumed or assigned Executory Contract or Unexpired Lease at any time prior to the effective 

date of assumption or assignment. Any and all Proofs of Claim based upon Executory Contracts 

or Unexpired Leases that have been assumed or assigned in the Chapter 11 Case, including 

pursuant to the Confirmation Order, and for which any cure amounts have been fully paid 

pursuant to this ARTICLE V.C, shall be deemed disallowed and expunged as of the 

Confirmation Date without the need for any objection thereto or any further notice to or action, 

order, or approval of the Bankruptcy Court. 

ARTICLE VI.

PROVISIONS GOVERNING DISTRIBUTIONS

A. Dates of Distributions

Except as otherwise provided in this Plan, on the Effective Date or as soon as reasonably 

practicable thereafter (or if a Claim is not an Allowed Claim or Equity Interest on the Effective 

Date, on the date that such Claim or Equity Interest becomes an Allowed Claim or Equity 

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001322

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Interest, or as soon as reasonably practicable thereafter), each Holder of an Allowed Claim or 

Equity Interest against the Debtor shall receive the full amount of the distributions that this Plan 

provides for Allowed Claims or Allowed Equity Interests in the applicable Class and in the 

manner provided herein. If any payment or act under this Plan is required to be made or 

performed on a date that is not on a Business Day, then the making of such payment or the 

performance of such act may be completed on the next succeeding Business Day, but shall be 

deemed to have been completed as of the required date. If and to the extent there are Disputed 

Claims or Equity Interests, distributions on account of any such Disputed Claims or Equity 

Interests shall be made pursuant to the provisions provided in this Plan. Except as otherwise 

provided in this Plan, Holders of Claims and Equity Interests shall not be entitled to interest, 

dividends or accruals on the distributions provided for therein, regardless of whether 

distributions are delivered on or at any time after the Effective Date. 

Upon the Effective Date, all Claims and Equity Interests against the Debtor shall be 

deemed fixed and adjusted pursuant to this Plan and none of the Debtor, the Reorganized Debtor, 

or the Claimant Trust will have liability on account of any Claims or Equity Interests except as 

set forth in this Plan and in the Confirmation Order. All payments and all distributions made by 

the Distribution Agent under this Plan shall be in full and final satisfaction, settlement and 

release of all Claims and Equity Interests against the Debtor and the Reorganized Debtor. 

At the close of business on the Distribution Record Date, the transfer ledgers for the 

Claims against the Debtor and the Equity Interests in the Debtor shall be closed, and there shall 

be no further changes in the record holders of such Claims and Equity Interests. The Debtor, the 

Reorganized Debtor, the Trustees, and the Distribution Agent, and each of their respective 

agents, successors, and assigns shall have no obligation to recognize the transfer of any Claims 

against the Debtor or Equity Interests in the Debtor occurring after the Distribution Record Date 

and shall be entitled instead to recognize and deal for all purposes hereunder with only those 

record holders stated on the transfer ledgers as of the close of business on the Distribution 

Record Date irrespective of the number of distributions to be made under this Plan to such 

Persons or the date of such distributions. 

B. Distribution Agent

Except as provided herein, all distributions under this Plan shall be made by the Claimant 

Trustee, as Distribution Agent, or by such other Entity designated by the Claimant Trustee, as a 

Distribution Agent on the Effective Date or thereafter. The Reorganized Debtor will be the 

Distribution Agent with respect to Claims in Class 1 through Class 7. 

The Claimant Trustee, or such other Entity designated by the Claimant Trustee to be the 

Distribution Agent, shall not be required to give any bond or surety or other security for the 

performance of such Distribution Agent’s duties unless otherwise ordered by the Bankruptcy 

Court. 

The Distribution Agent shall be empowered to (a) effect all actions and execute all 

agreements, instruments, and other documents necessary to perform its duties under this Plan; 

(b) make all distributions contemplated hereby; (c) employ professionals to represent it with 

respect to its responsibilities; and (d) exercise such other powers as may be vested in the 

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001323

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Distribution Agent by order of the Bankruptcy Court, pursuant to this Plan, or as deemed by the 

Distribution Agent to be necessary and proper to implement the provisions hereof. 

The Distribution Agent shall not have any obligation to make a particular distribution to a 

specific Holder of an Allowed Claim if such Holder is also the Holder of a Disputed Claim. 

C. Cash Distributions

Distributions of Cash may be made by wire transfer from a domestic bank, except that 

Cash payments made to foreign creditors may be made in such funds and by such means as the 

Distribution Agent determines are necessary or customary in a particular foreign jurisdiction.

D. Disputed Claims Reserve

On or prior to the Initial Distribution Date, the Claimant Trustee shall establish, fund and 

maintain the Disputed Claims Reserve(s) in the appropriate Disputed Claims Reserve Amounts 

on account of any Disputed Claims. 

E. Distributions from the Disputed Claims Reserve

The Disputed Claims Reserve shall at all times hold Cash in an amount no less than the 

Disputed Claims Reserve Amount. To the extent a Disputed Claim becomes an Allowed Claim 

pursuant to the terms of this Plan, within 30 days of the date on which such Disputed Claim 

becomes an Allowed Claim pursuant to the terms of this Plan, the Claimant Trustee shall 

distribute from the Disputed Claims Reserve to the Holder thereof any prior distributions, in 

Cash, that would have been made to such Allowed Claim if it had been Allowed as of the 

Effective Date. For the avoidance of doubt, each Holder of a Disputed Claim that subsequently 

becomes an Allowed Claim will also receive its Pro Rata share of the Claimant Trust Interests. 

If, upon the resolution of all Disputed Claims any Cash remains in the Disputed Claims Reserve, 

such Cash shall be transferred to the Claimant Trust and be deemed a Claimant Trust Asset. 

F. Rounding of Payments 

Whenever this Plan would otherwise call for, with respect to a particular Person, payment 

of a fraction of a dollar, the actual payment or distribution shall reflect a rounding of such 

fraction to the nearest whole dollar (up or down), with half dollars being rounded down. To the 

extent that Cash to be distributed under this Plan remains undistributed as a result of the 

aforementioned rounding, such Cash or stock shall be treated as “Unclaimed Property” under this 

Plan.

G. De Minimis Distribution

Except as to any Allowed Claim that is Unimpaired under this Plan, none of the Debtor,

the Reorganized Debtor, or the Distribution Agent shall have any obligation to make any Plan 

Distributions with a value of less than $100, unless a written request therefor is received by the 

Distribution Agent from the relevant recipient at the addresses set forth in ARTICLE VI.J hereof 

within 120 days after the later of the (i) Effective Date and (ii) the date such Claim becomes an 

Allowed Claim. De minimis distributions for which no such request is timely received shall 

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001324

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revert to the Claimant Trust. Upon such reversion, the relevant Allowed Claim (and any Claim 

on account of missed distributions) shall be automatically deemed satisfied, discharged and 

forever barred, notwithstanding any federal or state escheat laws to the contrary.

H. Distributions on Account of Allowed Claims

Except as otherwise agreed by the Holder of a particular Claim or as provided in this 

Plan, all distributions shall be made pursuant to the terms of this Plan and the Confirmation 

Order. Except as otherwise provided in this Plan, distributions to any Holder of an Allowed 

Claim shall, to the extent applicable, be allocated first to the principal amount of any such 

Allowed Claim, as determined for U.S. federal income tax purposes and then, to the extent the 

consideration exceeds such amount, to the remainder of such Claim comprising accrued but 

unpaid interest, if any (but solely to the extent that interest is an allowable portion of such 

Allowed Claim). 

I. General Distribution Procedures

The Distribution Agent shall make all distributions of Cash or other property required 

under this Plan, unless this Plan specifically provides otherwise. All Cash and other property 

held by the Debtor, the Reorganized Debtor, or the Claimant Trust, as applicable, for ultimate 

distribution under this Plan shall not be subject to any claim by any Person. 

J. Address for Delivery of Distributions

Distributions to Holders of Allowed Claims, to the extent provided for under this Plan, 

shall be made (1) at the addresses set forth in any written notices of address change delivered to 

the Debtor and the Distribution Agent; (2) at the address set forth on any Proofs of Claim Filed 

by such Holders (to the extent such Proofs of Claim are Filed in the Chapter 11 Case), (2), or (3) 

at the addresses in the Debtor’s books and records. 

If there is any conflict or discrepancy between the addresses set forth in (1) through (3) in 

the foregoing sentence, then (i) the address in Section (2) shall control; (ii) if (2) does not apply, 

the address in (1) shall control, and (iii) if (1) does not apply, the address in (3) shall control. 

K. Undeliverable Distributions and Unclaimed Property

If the distribution to the Holder of any Allowed Claim is returned to the Reorganized 

Debtor or the Claimant Trust as undeliverable, no further distribution shall be made to such 

Holder, and Distribution Agent shall not have any obligation to make any further distribution to 

the Holder, unless and until the Distribution Agent is notified in writing of such Holder’s then 

current address.

Any Entity that fails to claim any Cash within six months from the date upon which a 

distribution is first made to such Entity shall forfeit all rights to any distribution under this Plan 

and such Cash shall thereafter be deemed an Claimant Trust Asset in all respects and for all 

purposes. Entities that fail to claim Cash shall forfeit their rights thereto and shall have no claim 

whatsoever against the Debtor’s Estate, the Reorganized Debtor, the Claimant Trust, or against 

any Holder of an Allowed Claim to whom distributions are made by the Distribution Agent.

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001325

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L. Withholding Taxes 

In connection with this Plan, to the extent applicable, the Distribution Agent shall comply 

with all tax withholding and reporting requirements imposed on them by any Governmental Unit, 

and all distributions made pursuant to this Plan shall be subject to such withholding and 

reporting requirements. The Distribution Agent shall be entitled to deduct any U.S. federal, state 

or local withholding taxes from any Cash payments made with respect to Allowed Claims, as 

appropriate. As a condition to receiving any distribution under this Plan, the Distribution Agent 

may require that the Holder of an Allowed Claim entitled to receive a distribution pursuant to 

this Plan provide such Holder’s taxpayer identification number and such other information and 

certification as may be deemed necessary for the Distribution Agent to comply with applicable 

tax reporting and withholding laws. If a Holder fails to comply with such a request within one 

year, such distribution shall be deemed an unclaimed distribution. Any amounts withheld 

pursuant hereto shall be deemed to have been distributed to and received by the applicable 

recipient for all purposes of this Plan. 

M. Setoffs

The Distribution Agent may, to the extent permitted under applicable law, set off against

any Allowed Claim and any distributions to be made pursuant to this Plan on account of such 

Allowed Claim, the claims, rights and causes of action of any nature that the Debtor, the 

Reorganized Debtor, or the Distribution Agent may hold against the Holder of such Allowed 

Claim that are not otherwise waived, released or compromised in accordance with this Plan; 

provided, however, that neither such a setoff nor the allowance of any Claim hereunder shall 

constitute a waiver or release by the Debtor, the Reorganized Debtor, or the Claimant Trustee of 

any such claims, rights and causes of action that the Debtor, the Reorganized Debtor, or 

Claimant Trustee possesses against such Holder. Any Holder of an Allowed Claim subject to 

such setoff reserves the right to challenge any such setoff in the Bankruptcy Court or any other 

court with jurisdiction with respect to such challenge.

N. Surrender of Cancelled Instruments or Securities

As a condition precedent to receiving any distribution pursuant to this Plan on account of 

an Allowed Claim evidenced by negotiable instruments, securities, or notes canceled pursuant to 

ARTICLE IV of this Plan, the Holder of such Claim will tender the applicable negotiable 

instruments, securities, or notes evidencing such Claim (or a sworn affidavit identifying the 

negotiable instruments, securities, or notes formerly held by such Holder and certifying that they 

have been lost), to the Distribution Agent unless waived in writing by the Distribution Agent. 

O. Lost, Stolen, Mutilated or Destroyed Securities

In addition to any requirements under any applicable agreement and applicable law, any 

Holder of a Claim or Equity Interest evidenced by a security or note that has been lost, stolen, 

mutilated, or destroyed will, in lieu of surrendering such security or note to the extent required 

by this Plan, deliver to the Distribution Agent: (i) evidence reasonably satisfactory to the 

Distribution Agent of such loss, theft, mutilation, or destruction; and (ii) such security or 

indemnity as may be required by the Distribution Agent to hold such party harmless from any 

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001326

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44

damages, liabilities, or costs incurred in treating such individual as a Holder of an Allowed 

Claim or Equity Interest. Upon compliance with ARTICLE VI.O of this Plan as determined by 

the Distribution Agent, by a Holder of a Claim evidenced by a security or note, such Holder will, 

for all purposes under this Plan, be deemed to have surrendered such security or note to the 

Distribution Agent. 

ARTICLE VII.

PROCEDURES FOR RESOLVING CONTINGENT, 

UNLIQUIDATED AND DISPUTED CLAIMS

A. Filing of Proofs of Claim 

Unless such Claim appeared in the Schedules and is not listed as disputed, contingent, or 

unliquidated, or such Claim has otherwise been Allowed or paid, each Holder of a Claim was 

required to file a Proof of Claim on or prior to the Bar Date. 

B. Disputed Claims

Following the Effective Date, each of the Reorganized Debtor or the Claimant Trustee, as 

applicable, may File with the Bankruptcy Court an objection to the allowance of any Disputed 

Claim or Disputed Equity Interest, request the Bankruptcy Court subordinate any Claims to 

Subordinated Claims, or any other appropriate motion or adversary proceeding with respect to 

the foregoing by the Claims Objection Deadline or, at the discretion of the Reorganized Debtor 

or Claimant Trustee, as applicable, compromised, settled, withdrew or resolved without further 

order of the Bankruptcy Court, and (ii) unless otherwise provided in the Confirmation Order, the 

Reorganized Debtor or the Claimant Trust, as applicable, are authorized to settle, or withdraw 

any objections to, any Disputed Claim or Disputed Equity Interests following the Effective Date 

without further notice to creditors (other than the Entity holding such Disputed Claim or 

Disputed Equity Interest) or authorization of the Bankruptcy Court, in which event such Claim or 

Equity Interest shall be deemed to be an Allowed Claim or Equity Interest in the amount 

compromised for purposes of this Plan. 

C. Procedures Regarding Disputed Claims or Disputed Equity Interests

No payment or other distribution or treatment shall be made on account of a Disputed 

Claim or Disputed Equity Interest unless and until such Disputed Claim or Disputed Equity 

Interest becomes an Allowed Claim or Equity Interests and the amount of such Allowed Claim 

or Equity Interest, as applicable, is determined by order of the Bankruptcy Court or by 

stipulation between the Reorganized Debtor or Claimant Trust, as applicable, and the Holder of 

the Claim or Equity Interest.

D. Allowance of Claims and Equity Interests 

Following the date on which a Disputed Claim or Disputed Equity Interest becomes an 

Allowed Claim or Equity Interest after the Distribution Date, the Distribution Agent shall make a 

distribution to the Holder of such Allowed Claim or Equity Interest in accordance with the Plan. 

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001327

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1. Allowance of Claims 

After the Effective Date and subject to the other provisions of this Plan, the Reorganized 

Debtor or the Claimant Trust, as applicable, will have and will retain any and all rights and 

defenses under bankruptcy or nonbankruptcy law that the Debtor had with respect to any Claim. 

Except as expressly provided in this Plan or in any order entered in the Chapter 11 Case prior to 

the Effective Date (including, without limitation, the Confirmation Order), no Claim or Equity 

Interest will become an Allowed Claim or Equity Interest unless and until such Claim or Equity 

Interest is deemed Allowed under this Plan or the Bankruptcy Code or the Bankruptcy Court has 

entered an order, including, without limitation, the Confirmation Order, in the Chapter 11 Case 

allowing such Claim or Equity Interest. 

2. Estimation

Subject to the other provisions of this Plan, the Debtor, prior to the Effective Date, and 

the Reorganized Debtor or the Claimant Trustee, as applicable, after the Effective Date, may, at 

any time, request that the Bankruptcy Court estimate (a) any Disputed Claim or Disputed Equity 

Interest pursuant to applicable law and in accordance with this Plan and (b) any contingent or 

unliquidated Claim pursuant to applicable law, including, without limitation, section 502(c) of 

the Bankruptcy Code, and the Bankruptcy Court will retain jurisdiction under 28 U.S.C. §§ 157 

and 1334 to estimate any Disputed Claim or Disputed Equity Interest, contingent Claim or 

unliquidated Claim, including during the litigation concerning any objection to any Claim or 

Equity Interest or during the pendency of any appeal relating to any such objection. All of the 

aforementioned objection, estimation and resolution procedures are cumulative and not exclusive 

of one another. Claims or Equity Interests may be estimated and subsequently compromised, 

settled, withdrawn or resolved by any mechanism approved by the Bankruptcy Court. The rights 

and objections of all parties are reserved in connection with any such estimation proceeding. 

3. Disallowance of Claims

Any Claims or Equity Interests held by Entities from which property is recoverable under 

sections 542, 543, 550, or 553 of the Bankruptcy Code, or that are a transferee of a transfer 

avoidable under sections 522(f), 522(h), 544, 545, 547, 548, 549, or 724(a) of the Bankruptcy 

Code, shall be deemed disallowed pursuant to section 502(d) of the Bankruptcy Code, and 

holders of such Claims or Interests may not receive any distributions on account of such Claims 

or Interests until such time as such Causes of Action against that Entity have been settled or a 

Bankruptcy Court Order with respect thereto has been entered and all sums due, if any, to the 

Reorganized Debtor or the Claimant Trust, as applicable, by that Entity have been turned over or 

paid to the Reorganized Debtor or the Claimant Trust, as applicable. 

EXCEPT AS OTHERWISE PROVIDED HEREIN OR AS AGREED TO BY THE 

DEBTOR, REORGANIZED DEBTOR, OR CLAIMANT TRUSTEE, AS APPLICABLE, 

ANY AND ALL PROOFS OF CLAIM FILED AFTER THE BAR DATE SHALL BE 

DEEMED DISALLOWED AND EXPUNGED AS OF THE EFFECTIVE DATE 

WITHOUT ANY FURTHER NOTICE TO OR ACTION, ORDER, OR APPROVAL OF 

THE BANKRUPTCY COURT, AND HOLDERS OF SUCH CLAIMS MAY NOT 

RECEIVE ANY DISTRIBUTIONS ON ACCOUNT OF SUCH CLAIMS, UNLESS SUCH 

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LATE PROOF OF CLAIM HAS BEEN DEEMED TIMELY FILED BY A FINAL 

ORDER.

ARTICLE VIII.

EFFECTIVENESS OF THIS PLAN

A. Conditions Precedent to the Effective Date 

The Effective Date of this Plan will be conditioned upon the satisfaction or waiver by the 

Debtor (and, to the extent such condition requires the consent of the Committee, the consent of 

the Committee with such consent not to be unreasonably withheld), pursuant to the provisions of 

ARTICLE VIII.B of this Plan of the following: 

x This Plan and the Plan Documents, including the Claimant Trust Agreement and the 

Reorganized Limited Partnership Agreement, and all schedules, documents, 

supplements and exhibits to this Plan shall have been Filed in form and substance 

reasonably acceptable to the Debtor and the Committee.

x The Confirmation Order shall have become a Final Order and shall be in form and 

substance reasonably acceptable to the Debtor and the Committee. The Confirmation 

Order shall provide that, among other things, (i) the Debtor, the Reorganized Debtor, 

the Claimant Trustee, or the Litigation Trustee are authorized to take all actions 

necessary or appropriate to effectuate and consummate this Plan, including, without 

limitation, (a) entering into, implementing, effectuating, and consummating the 

contracts, instruments, releases, and other agreements or documents created in 

connection with or described in this Plan, (b) assuming the Executory Contracts and 

Unexpired Leases set forth in the Plan Supplement, (c) making all distributions and 

issuances as required under this Plan; and (d) entering into any transactions as set 

forth in the Plan Documents; (ii) the provisions of the Confirmation Order and this 

Plan are nonseverable and mutually dependent; (iii) the implementation of this Plan in 

accordance with its terms is authorized; (iv) pursuant to section 1146 of the 

Bankruptcy Code, the delivery of any deed or other instrument or transfer order, in 

furtherance of, or in connection with this Plan, including any deeds, bills of sale, or 

assignments executed in connection with any disposition or transfer of Assets 

contemplated under this Plan, shall not be subject to any Stamp or Similar Tax; and 

(v) the vesting of the Claimant Trust Assets in the Claimant Trust and the 

Reorganized Debtor Assets in the Reorganized Debtor, in each case as of the 

Effective Date free and clear of liens and claims to the fullest extent permissible 

under applicable law pursuant to section 1141(c) of the Bankruptcy Code except with 

respect to such Liens, Claims, charges and other encumbrances that are specifically 

preserved under this Plan upon the Effective Date. 

x All documents and agreements necessary to implement this Plan, including without 

limitation, the Reorganized Limited Partnership Agreement, the Claimant Trust 

Agreement, and the New GP LLC Documents, in each case in form and substance 

reasonably acceptable to the Debtor and the Committee, shall have (a) been tendered 

for delivery, and (b) been effected by, executed by, or otherwise deemed binding 

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upon, all Entities party thereto and shall be in full force and effect. All conditions 

precedent to such documents and agreements shall have been satisfied or waived 

pursuant to the terms of such documents or agreements. 

x All authorizations, consents, actions, documents, approvals (including any 

governmental approvals), certificates and agreements necessary to implement this 

Plan, including, without limitation, the Reorganized Limited Partnership Agreement, 

the Claimant Trust Agreement, and the New GP LLC Documents, shall have been 

obtained, effected or executed and delivered to the required parties and, to the extent 

required, filed with the applicable governmental units in accordance with applicable 

laws and any applicable waiting periods shall have expired without any action being 

taken or threatened by any competent authority that would restrain or prevent 

effectiveness or consummation of the Restructuring. 

x The Debtor shall have obtained applicable directors’ and officers’ insurance coverage 

that is acceptable to each of the Debtor, the Committee, the Claimant Trust Oversight 

Committee, the Claimant Trustee and the Litigation Trustee.

x The Professional Fee Reserve shall be funded pursuant to this Plan in an amount 

determined by the Debtor in good faith. 

B. Waiver of Conditions 

The conditions to effectiveness of this Plan set forth in this ARTICLE VIII (other than 

that the Confirmation Order shall have been entered) may be waived in whole or in part by the 

Debtor (and, to the extent such condition requires the consent of the Committee, the consent of 

the Committee) and any applicable parties in Section VII.A of this Plan, without notice, leave or 

order of the Bankruptcy Court or any formal action other than proceeding to confirm or 

effectuate this Plan. The failure to satisfy or waive a condition to the Effective Date may be 

asserted by the Debtor regardless of the circumstances giving rise to the failure of such condition 

to be satisfied. The failure of the Debtor to exercise any of the foregoing rights will not be 

deemed a waiver of any other rights, and each right will be deemed an ongoing right that may be 

asserted at any time by the Debtor, the Reorganized Debtor, or the Claimant Trust, as applicable.

C. Dissolution of the Committee

On the Effective Date, the Committee will dissolve, and the members of the Committee 

and the Committee’s Professionals will cease to have any role arising from or relating to the 

Chapter 11 Case, except in connection with final fee applications of Professionals for services 

rendered prior to the Effective Date (including the right to object thereto). The Professionals 

retained by the Committee and the members thereof will not be entitled to assert any fee claims 

for any services rendered to the Committee or expenses incurred in the service of the Committee 

after the Effective Date, except for reasonable fees for services rendered, and actual and 

necessary costs incurred, in connection with any applications for allowance of Professional Fees 

pending on the Effective Date or filed and served after the Effective Date pursuant to the Plan. 

Nothing in the Plan shall prohibit or limit the ability of the Debtor’s or Committee’s 

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Professionals to represent either of the Trustees or to be compensated or reimbursed per the Plan 

and the Claimant Trust Agreement in connection with such representation. 

ARTICLE IX.

EXCULPATION, INJUNCTION AND RELATED PROVISIONS

A. General

Notwithstanding anything contained in the Plan to the contrary, the allowance, 

classification and treatment of all Allowed Claims and Equity Interests and their respective 

distributions and treatments under the Plan shall take into account the relative priority and rights 

of the Claims and the Equity Interests in each Class in connection with any contractual, legal and 

equitable subordination rights relating thereto whether arising under general principles of 

equitable subordination, section 510 of the Bankruptcy Code, or otherwise. 

B. Discharge of Claims 

To the fullest extent provided under section 1141(d)(1)(A) and other applicable 

provisions of the Bankruptcy Code, except as otherwise expressly provided by this Plan or the 

Confirmation Order, all consideration distributed under this Plan will be in exchange for, and in 

complete satisfaction, settlement, discharge, and release of, all Claims and Equity Interests of 

any kind or nature whatsoever against the Debtor or any of its Assets or properties, and 

regardless of whether any property will have been distributed or retained pursuant to this Plan on 

account of such Claims or Equity Interests. Except as otherwise expressly provided by this Plan 

or the Confirmation Order, upon the Effective Date, the Debtor and its Estate will be deemed 

discharged and released under and to the fullest extent provided under section 1141(d)(1)(A) and 

other applicable provisions of the Bankruptcy Code from any and all Claims and Equity Interests 

of any kind or nature whatsoever, including, but not limited to, demands and liabilities that arose 

before the Confirmation Date, and all debts of the kind specified in section 502(g), 502(h), or 

502(i) of the Bankruptcy Code. 

C. Exculpation 

Subject in all respects to ARTICLE XII.D of this Plan, to the maximum extent permitted 

by applicable law, no Exculpated Party will have or incur, and each Exculpated Party is hereby 

exculpated from, any claim, obligation, suit, judgment, damage, demand, debt, right, Cause of 

Action, remedy, loss, and liability for conduct occurring on or after the Petition Date in 

connection with or arising out of (i) the filing and administration of the Chapter 11 Case; (ii) the 

negotiation and pursuit of the Disclosure Statement, the Plan, or the solicitation of votes for, or 

confirmation of, the Plan; (iii) the funding or consummation of the Plan (including the Plan 

Supplement) or any related agreements, instruments, or other documents, the solicitation of votes 

on the Plan, the offer, issuance, and Plan Distribution of any securities issued or to be issued 

pursuant to the Plan, including the Claimant Trust Interests, whether or not such Plan 

Distributions occur following the Effective Date; (iv) the implementation of the Plan; and (v) any 

negotiations, transactions, and documentation in connection with the foregoing clauses (i)-(iv); 

provided, however, the foregoing will not apply to (a) any acts or omissions of an Exculpated 

Party arising out of or related to acts or omissions that constitute bad faith, fraud, gross 

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negligence, criminal misconduct, or willful misconduct or (b) Strand or any Employee other than 

with respect to actions taken by such Entities from the date of appointment of the Independent 

Directors through the Effective Date. This exculpation shall be in addition to, and not in 

limitation of, all other releases, indemnities, exculpations, any other applicable law or rules, or 

any other provisions of this Plan, including ARTICLE IV.C.2, protecting such Exculpated 

Parties from liability.

D. Releases by the Debtor 

On and after the Effective Date, each Released Party is deemed to be, hereby 

conclusively, absolutely, unconditionally, irrevocably, and forever released and discharged by 

the Debtor and the Estate, in each case on behalf of themselves and their respective successors, 

assigns, and representatives, including, but not limited to, the Claimant Trust and the Litigation 

Sub-Trust from any and all Causes of Action, including any derivative claims, asserted on behalf 

of the Debtor, whether known or unknown, foreseen or unforeseen, matured or unmatured, 

existing or hereafter arising, in law, equity, contract, tort or otherwise, that the Debtor or the 

Estate would have been legally entitled to assert in their own right (whether individually or 

collectively) or on behalf of the holder of any Claim against, or Interest in, a Debtor or other 

Person. 

Notwithstanding anything contained herein to the contrary, the foregoing release does not 

release: (i) any obligations of any party under the Plan or any document, instrument, or 

agreement executed to implement the Plan, (ii) the rights or obligations of any current employee 

of the Debtor under any employment agreement or plan, (iii) the rights of the Debtor with respect 

to any confidentiality provisions or covenants restricting competition in favor of the Debtor 

under any employment agreement with a current or former employee of the Debtor, (iv) any 

Avoidance Actions, or (v) any Causes of Action arising from willful misconduct, criminal 

misconduct, actual fraud, or gross negligence of such applicable Released Party as determined by 

Final Order of the Bankruptcy Court or any other court of competent jurisdiction. 

Notwithstanding anything herein to the contrary, any release provided pursuant to this 

ARTICLE IX.D (i) with respect to a Senior Employee, is conditioned in all respects on (a) such 

Senior Employee executing a Senior Employee Stipulation on or prior to the Effective Date and 

(b) the reduction of such Senior Employee’s Allowed Claim as set forth in the Senior Employee 

Stipulation (such amount, the “Reduced Employee Claim”), and (ii) with respect to any 

Employee, including a Senior Employee, shall be deemed null and void and of no force and 

effect (1) if there is more than one member of the Claimant Trust Oversight Committee who does 

not represent entities holding a Disputed or Allowed Claim (the “Independent Members”), the 

Claimant Trustee and the Independent Members by majority vote determine or (2) if there is only 

one Independent Member, the Independent Member after discussion with the Claimant Trustee, 

determines (in each case after discussing with the full Claimant Trust Oversight Committee) that 

such Employee (regardless of whether the Employee is then currently employed by the Debtor, 

the Reorganized Debtor, or the Claimant Trustee): 

x sues, attempts to sue, or threatens or works with or assists any entity or person to sue, 

attempt to sue, or threaten the Reorganized Debtor, the Claimant Trust, the Litigation 

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Sub-Trust, or any of their respective employees or agents, or any Released Party on or 

in connection with any claim or cause of action arising prior to the Effective Date, 

x has taken any action that, impairs or harms the value of the Claimant Trust Assets or 

the Reorganized Debtor Assets, or 

x (x) upon the request of the Claimant Trustee, has failed to provide reasonable 

assistance in good faith to the Claimant Trustee or the Reorganized Debtor with 

respect to (1) the monetization of the Claimant Trust Assets or Reorganized Debtor 

Assets, as applicable, or (2) the resolution of Claims, or (y) has taken any action that 

impedes or frustrates the Claimant Trustee or the Reorganized Debtor with respect to 

any of the foregoing. 

Provided, however, that the release provided pursuant to this ARTICLE IX.D will vest and the 

Employee will be indefeasibly released pursuant to this ARTICLE IX.D if such Employee’s 

release has not been deemed null and void and of no force and effect on or prior to the date that 

is the date of dissolution of the Claimant Trust pursuant to the Claimant Trust Agreement. 

By executing the Senior Employee Stipulation embodying this release, each Senior 

Employee acknowledges and agrees, without limitation, to the terms of this release and the 

tolling agreement contained in the Senior Employee Stipulation.

The provisions of this release and the execution of a Senior Employee Stipulation will not 

in any way prevent or limit any Employee from (i) prosecuting its Claims, if any, against the 

Debtor’s Estate, (ii) defending him or herself against any claims or causes of action brought 

against the Employee by a third party, or (iii) assisting other persons in defending themselves 

from any Estate Claims brought by the Litigation Trustee (but only with respect to Estate Claims 

brought by the Litigation Trustee and not collection or other actions brought by the Claimant 

Trustee). 

E. Preservation of Rights of Action 

1. Maintenance of Causes of Action 

Except as otherwise provided in this Plan, after the Effective Date, the Reorganized 

Debtor or the Claimant Trust will retain all rights to commence, pursue, litigate or settle, as 

appropriate, any and all Causes of Action included in the Reorganized Debtor Assets or Claimant 

Trust Assets, as applicable, whether existing as of the Petition Date or thereafter arising, in any 

court or other tribunal including, without limitation, in an adversary proceeding Filed in the 

Chapter 11 Case and, as the successors in interest to the Debtor and the Estate, may, and will 

have the exclusive right to, enforce, sue on, settle, compromise, transfer or assign (or decline to 

do any of the foregoing) any or all of the Causes of Action without notice to or approval from the 

Bankruptcy Court. 

2. Preservation of All Causes of Action Not Expressly Settled or Released 

Unless a Cause of Action against a Holder of a Claim or an Equity Interest or other Entity 

is expressly waived, relinquished, released, compromised or settled in this Plan or any Final 

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Order (including, without limitation, the Confirmation Order), such Cause of Action is expressly 

reserved for later adjudication by the Reorganized Debtor or Claimant Trust, as applicable 

(including, without limitation, Causes of Action not specifically identified or of which the 

Debtor may presently be unaware or that may arise or exist by reason of additional facts or 

circumstances unknown to the Debtor at this time or facts or circumstances that may change or 

be different from those the Debtor now believes to exist) and, therefore, no preclusion doctrine, 

including, without limitation, the doctrines of res judicata, collateral estoppel, issue preclusion, 

claim preclusion, waiver, estoppel (judicial, equitable or otherwise) or laches will apply to such 

Causes of Action as a consequence of the confirmation, effectiveness, or consummation of this 

Plan based on the Disclosure Statement, this Plan or the Confirmation Order, except where such 

Causes of Action have been expressly released in this Plan or any other Final Order (including, 

without limitation, the Confirmation Order). In addition, the right of the Reorganized Debtor or 

the Claimant Trust to pursue or adopt any claims alleged in any lawsuit in which the Debtor is a 

plaintiff, defendant or an interested party, against any Entity, including, without limitation, the 

plaintiffs or co-defendants in such lawsuits, is expressly reserved.

F. Injunction

Upon entry of the Confirmation Order, all Enjoined Parties are and shall be 

permanently enjoined, on and after the Effective Date, from taking any actions to interfere 

with the implementation or consummation of the Plan. 

Except as expressly provided in the Plan, the Confirmation Order, or a separate 

order of the Bankruptcy Court, all Enjoined Parties are and shall be permanently 

enjoined, on and after the Effective Date, with respect to any Claims and Equity Interests, 

from directly or indirectly (i) commencing, conducting, or continuing in any manner any 

suit, action, or other proceeding of any kind (including any proceeding in a judicial, 

arbitral, administrative or other forum) against or affecting the Debtor or the property of 

the Debtor, (ii) enforcing, levying, attaching (including any prejudgment attachment), 

collecting, or otherwise recovering, enforcing, or attempting to recover or enforce, by any 

manner or means, any judgment, award, decree, or order against the Debtor or the 

property of the Debtor, (iii) creating, perfecting, or otherwise enforcing in any manner, any 

security interest, lien or encumbrance of any kind against the Debtor or the property of the 

Debtor, (iv) asserting any right of setoff, directly or indirectly, against any obligation due to

the Debtor or against property or interests in property of the Debtor, except to the limited 

extent permitted under Sections 553 and 1141 of the Bankruptcy Code, and (v) acting or 

proceeding in any manner, in any place whatsoever, that does not conform to or comply 

with the provisions of the Plan.

The injunctions set forth herein shall extend to, and apply to any act of the type set 

forth in any of clauses (i)-(v) of the immediately preceding paragraph against any 

successors of the Debtor, including, but not limited to, the Reorganized Debtor, the 

Litigation Sub-Trust, and the Claimant Trust and their respective property and interests in 

property.

Subject in all respects to ARTICLE XII.D, no Enjoined Party may commence or 

pursue a claim or cause of action of any kind against any Protected Party that arose or 

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arises from or is related to the Chapter 11 Case, the negotiation of the Plan, the 

administration of the Plan or property to be distributed under the Plan, the wind down of 

the business of the Debtor or Reorganized Debtor, the administration of the Claimant 

Trust or the Litigation Sub-Trust, or the transactions in furtherance of the foregoing 

without the Bankruptcy Court (i) first determining, after notice and a hearing, that such 

claim or cause of action represents a colorable claim of any kind, including, but not limited 

to, negligence, bad faith, criminal misconduct, willful misconduct, fraud, or gross 

negligence against a Protected Party and (ii) specifically authorizing such Enjoined Party

to bring such claim or cause of action against any such Protected Party; provided, however,

the foregoing will not apply to a claim or cause of action against Strand or against any 

Employee other than with respect to actions taken, respectively, by Strand or by such 

Employee from the date of appointment of the Independent Directors through the Effective 

Date. The Bankruptcy Court will have sole and exclusive jurisdiction to determine 

whether a claim or cause of action is colorable and, only to the extent legally permissible 

and as provided for in ARTICLE XI, shall have jurisdiction to adjudicate the underlying 

colorable claim or cause of action. 

G. Duration of Injunctions and Stays 

ARTICLE II. Unless otherwise provided in this Plan, in the Confirmation Order, or 

in a Final Order of the Bankruptcy Court, (i) all injunctions and stays entered during the 

Chapter 11 Case and in existence on the Confirmation Date shall remain in full force and 

effect in accordance with their terms; and (ii) the automatic stay arising under section 362 

of the Bankruptcy Code shall remain in full force and effect subject to Section 362(c) of the 

Bankruptcy Code, and to the extent necessary if the Debtor does not receive a discharge,

the Court will enter an equivalent order under Section 105.

H. Continuance of January 9 Order 

Unless otherwise provided in this Plan, in the Confirmation Order, or in a Final Order of 

the Bankruptcy Court, the restrictions set forth in paragraphs 9 and 10 of the Order Approving 

Settlement with Official Committee of Unsecured Creditors Regarding Governance of the Debtor 

and Procedures for Operations in the Ordinary Course, entered by the Bankruptcy Court on 

January 9, 2020 [D.I. 339] shall remain in full force and effect following the Effective Date. 

ARTICLE X.

BINDING NATURE OF PLAN

On the Effective Date, and effective as of the Effective Date, the Plan, including, without 

limitation, the provisions in ARTICLE IX, will bind, and will be deemed binding upon, all 

Holders of Claims against and Equity Interests in the Debtor and such Holder’s respective 

successors and assigns, to the maximum extent permitted by applicable law, notwithstanding 

whether or not such Holder will receive or retain any property or interest in property under the 

Plan. All Claims and Debts shall be fixed and adjusted pursuant to this Plan. The Plan shall also 

bind any taxing authority, recorder of deeds, or similar official for any county, state, 

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001335

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Governmental Unit or parish in which any instrument related to the Plan or related to any 

transaction contemplated thereby is to be recorded with respect to nay taxes of the kind specified 

in Bankruptcy Code section 1146(a). 

ARTICLE XI.

RETENTION OF JURISDICTION

Pursuant to sections 105 and 1142 of the Bankruptcy Code and notwithstanding the entry 

of the Confirmation Order and the occurrence of the Effective Date, the Bankruptcy Court shall, 

after the Effective Date, retain such jurisdiction over the Chapter 11 Case and all Entities with 

respect to all matters related to the Chapter 11 Case, the Reorganized Debtor, the Claimant Trust, 

and this Plan to the maximum extent legally permissible, including, without limitation, 

jurisdiction to:

x allow, disallow, determine, liquidate, classify, estimate or establish the priority, 

secured, unsecured, or subordinated status of any Claim or Equity Interest, including, 

without limitation, the resolution of any request for payment of any Administrative 

Expense Claim and the resolution of any and all objections to the allowance or 

priority of any Claim or Equity Interest;

x grant or deny any applications for allowance of compensation or reimbursement of 

expenses authorized pursuant to the Bankruptcy Code or this Plan, for periods ending 

on or before the Effective Date; provided, however, that, from and after the Effective 

Date, the Reorganized Debtor shall pay Professionals in the ordinary course of 

business for any work performed after the Effective Date subject to the terms of this 

Plan and the Confirmation Order, and such payment shall not be subject to the 

approval of the Bankruptcy Court; 

x resolve any matters related to the assumption, assignment or rejection of any 

Executory Contract or Unexpired Lease to which the Debtor is party or with respect 

to which the Debtor, Reorganized Debtor, or Claimant Trust may be liable and to 

adjudicate and, if necessary, liquidate, any Claims arising therefrom, including, 

without limitation, any dispute regarding whether a contract or lease is or was 

executory or expired;

x make any determination with respect to a claim or cause of action against a Protected 

Party as set forth in ARTICLE IX;

x resolve any claim or cause of action against an Exculpated Party or Protected Party 

arising from or related to the Chapter 11 Case, the negotiation of this Plan, the 

administration of the Plan or property to be distributed under the Plan, the wind down 

of the business of the Debtor or Reorganized Debtor, or the transactions in 

furtherance of the foregoing;

x if requested by the Reorganized Debtor or the Claimant Trustee, authorize, approve, 

and allow any sale, disposition, assignment or other transfer of the Reorganized 

Debtor Assets or Claimant Trust Assets, including any break-up compensation or 

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001336

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expense reimbursement that may be requested by a purchaser thereof; provided, 

however, that neither the Reorganized Debtor nor the Claimant Trustee shall be 

required to seek such authority or approval from the Bankruptcy Court unless 

otherwise specifically required by this Plan or the Confirmation Order; 

x if requested by the Reorganized Debtor or the Claimant Trustee, authorize, approve, 

and allow any borrowing or the incurrence of indebtedness, whether secured or 

unsecured by the Reorganized Debtor or Claimant Trust; provided, however, that 

neither the Reorganized Debtor nor the Claimant Trustee shall be required to seek 

such authority or approval from the Bankruptcy Court unless otherwise specifically 

required by this Plan or the Confirmation Order; 

x resolve any issues related to any matters adjudicated in the Chapter 11 Case;

x ensure that distributions to Holders of Allowed Claims and Allowed Equity Interests 

are accomplished pursuant to the provisions of this Plan; 

x decide or resolve any motions, adversary proceedings, contested or litigated matters 

and any other Causes of Action (including Estate Claims) that are pending as of the 

Effective Date or that may be commenced in the future, including approval of any 

settlements, compromises, or other resolutions as may be requested by the Debtor, the 

Reorganized Debtor, the Claimant Trustee, or the Litigation Trustee whether under 

Bankruptcy Rule 9019 or otherwise, and grant or deny any applications involving the

Debtor that may be pending on the Effective Date or instituted by the Reorganized 

Debtor, the Claimant Trustee, or Litigation Trustee after the Effective Date, provided 

that the Reorganized Debtor, the Claimant Trustee, and the Litigation Trustee shall 

reserve the right to commence actions in all appropriate forums and jurisdictions; 

x enter such orders as may be necessary or appropriate to implement, effectuate, or 

consummate the provisions of this Plan, the Plan Documents, and all other contracts, 

instruments, releases, and other agreements or documents adopted in connection with 

this Plan, the Plan Documents, or the Disclosure Statement; 

x resolve any cases, controversies, suits or disputes that may arise in connection with 

the implementation, effectiveness, consummation, interpretation, or enforcement of 

this Plan or any Entity’s obligations incurred in connection with this Plan; 

x issue injunctions and enforce them, enter and implement other orders or take such 

other actions as may be necessary or appropriate to restrain interference by any Entity 

with implementation, effectiveness, consummation, or enforcement of this Plan, 

except as otherwise provided in this Plan; 

x enforce the terms and conditions of this Plan and the Confirmation Order; 

x resolve any cases, controversies, suits or disputes with respect to the release, 

exculpation, indemnification, and other provisions contained herein and enter such 

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001337

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55

orders or take such others actions as may be necessary or appropriate to implement or 

enforce all such releases, injunctions and other provisions; 

x enter and implement such orders or take such others actions as may be necessary or 

appropriate if the Confirmation Order is modified, stayed, reversed, revoked or 

vacated;

x resolve any other matters that may arise in connection with or relate to this Plan, the 

Disclosure Statement, the Confirmation Order, the Plan Documents, or any contract, 

instrument, release, indenture or other agreement or document adopted in connection 

with this Plan or the Disclosure Statement; and

x enter an order concluding or closing the Chapter 11 Case after the Effective Date.

ARTICLE XII.

MISCELLANEOUS PROVISIONS

A. Payment of Statutory Fees and Filing of Reports 

All outstanding Statutory Fees shall be paid on the Effective Date. All such fees payable, 

and all such fees that become due and payable, after the Effective Date shall be paid by the 

Reorganized Debtor when due or as soon thereafter as practicable until the Chapter 11 Case is 

closed, converted, or dismissed. The Claimant Trustee shall File all quarterly reports due prior to 

the Effective Date when they become due, in a form reasonably acceptable to the U.S. Trustee. 

After the Effective Date, the Claimant Trustee shall File with the Bankruptcy Court quarterly 

reports when they become due, in a form reasonably acceptable to the U.S. Trustee. The 

Reorganized Debtor shall remain obligated to pay Statutory Fees to the Office of the U.S. 

Trustee until the earliest of the Debtor’s case being closed, dismissed, or converted to a case 

under chapter 7 of the Bankruptcy Code. 

B. Modification of Plan 

Effective as of the date hereof and subject to the limitations and rights contained in this 

Plan: (a) the Debtor reserves the right, in accordance with the Bankruptcy Code and the 

Bankruptcy Rules, to amend or modify this Plan prior to the entry of the Confirmation Order 

with the consent of the Committee, such consent not to be unreasonably withheld; and (b) after 

the entry of the Confirmation Order, the Debtor may, after notice and hearing and entry of an 

order of the Bankruptcy Court, amend or modify this Plan, in accordance with section 1127(b) of 

the Bankruptcy Code or remedy any defect or omission or reconcile any inconsistency in this 

Plan in such manner as may be necessary to carry out the purpose and intent of this Plan.

C. Revocation of Plan 

The Debtor reserves the right to revoke or withdraw this Plan prior to the Confirmation 

Date and to File a subsequent chapter 11 plan with the consent of the Committee. If the Debtor 

revokes or withdraws this Plan prior to the Confirmation Date, then: (i) this Plan shall be null 

and void in all respects; (ii) any settlement or compromise embodied in this Plan, assumption of 

Executory Contracts or Unexpired Leases effected by this Plan and any document or agreement 

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001338

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56

executed pursuant hereto shall be deemed null and void except as may be set forth in a separate 

order entered by the Bankruptcy Court; and (iii) nothing contained in this Plan shall: 

(a) constitute a waiver or release of any Claims by or against, or any Equity Interests in, the 

Debtor or any other Entity; (b) prejudice in any manner the rights of the Debtor or any other 

Entity; or (c) constitute an admission, acknowledgement, offer or undertaking of any sort by the 

Debtor or any other Entity. 

D. Obligations Not Changed

Notwithstanding anything in this Plan to the contrary, nothing herein will affect or 

otherwise limit or release any non-Debtor Entity’s (including any Exculpated Party’s) duties or 

obligations, including any contractual and indemnification obligations, to the Debtor, the 

Reorganized Debtor, or any other Entity whether arising under contract, statute, or otherwise. 

E. Entire Agreement

Except as otherwise described herein, this Plan supersedes all previous and 

contemporaneous negotiations, promises, covenants, agreements, understandings, and 

representations on such subjects, all of which have become merged and integrated into this Plan. 

F. Closing of Chapter 11 Case

The Claimant Trustee shall, after the Effective Date and promptly after the full 

administration of the Chapter 11 Case, File with the Bankruptcy Court all documents required by 

Bankruptcy Rule 3022 and any applicable order of the Bankruptcy Court to close the Chapter 11 

Case. 

G. Successors and Assigns

This Plan shall be binding upon and inure to the benefit of the Debtor and its successors 

and assigns, including, without limitation, the Reorganized Debtor and the Claimant Trustee. 

The rights, benefits, and obligations of any Person or Entity named or referred to in this Plan 

shall be binding on, and shall inure to the benefit of, any heir, executor, administrator, successor, 

or assign of such Person or Entity. 

H. Reservation of Rights 

Except as expressly set forth herein, this Plan shall have no force or effect unless and 

until the Bankruptcy Court enters the Confirmation Order and the Effective Date occurs. Neither 

the filing of this Plan, any statement or provision contained herein, nor the taking of any action 

by the Debtor, the Reorganized Debtor, the Claimant Trustee, or any other Entity with respect to

this Plan shall be or shall be deemed to be an admission or waiver of any rights of: (1) the 

Debtor, the Reorganized Debtor, or the Claimant Trustee with respect to the Holders of Claims 

or Equity Interests or other Entity; or (2) any Holder of a Claim or an Equity Interest or other 

Entity prior to the Effective Date.

Neither the exclusion or inclusion by the Debtor of any contract or lease on any exhibit, 

schedule, or other annex to this Plan or in the Plan Documents, nor anything contained in this 

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001339

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57

Plan, will constitute an admission by the Debtor that any such contract or lease is or is not an 

executory contract or lease or that the Debtor, the Reorganized Debtor, the Claimant Trustee, or 

their respective Affiliates has any liability thereunder. 

Except as explicitly provided in this Plan, nothing herein shall waive, excuse, limit, 

diminish, or otherwise alter any of the defenses, claims, Causes of Action, or other rights of the 

Debtor, the Reorganized Debtor, or the Claimant Trustee under any executory or non-executory 

contract.

Nothing in this Plan will increase, augment, or add to any of the duties, obligations, 

responsibilities, or liabilities of the Debtor, the Reorganized Debtor, or the Claimant Trustee, as 

applicable, under any executory or non-executory contract or lease.

If there is a dispute regarding whether a contract or lease is or was executory at the time 

of its assumption under this Plan, the Debtor, the Reorganized Debtor, or the Claimant Trustee, 

as applicable, shall have thirty (30) days following entry of a Final Order resolving such dispute 

to alter their treatment of such contract.

I. Further Assurances

The Debtor, the Reorganized Debtor, or the Claimant Trustee, as applicable, all Holders 

of Claims and Equity Interests receiving distributions hereunder, and all other Entities shall, 

from time to time, prepare, execute and deliver any agreements or documents and take any other 

actions as may be necessary or advisable to effectuate the provisions and intent of this Plan or 

the Confirmation Order. On or before the Effective Date, the Debtor shall File with the 

Bankruptcy Court all agreements and other documents that may be necessary or appropriate to 

effectuate and further evidence the terms and conditions hereof. 

J. Severability

If, prior to the Confirmation Date, any term or provision of this Plan is determined by the 

Bankruptcy Court to be invalid, void, or unenforceable, the Bankruptcy Court will have the 

power to alter and interpret such term or provision to make it valid or 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 will 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 will constitute a judicial determination and will 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. 

K. Service of Documents

All notices, requests, and demands to or upon the Debtor, the Reorganized Debtor, or the 

Claimant Trustee to be effective shall be in writing and, unless otherwise expressly provided 

herein, shall be deemed to have been duly given or made when actually delivered addressed as 

follows: 

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001340

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58

If to the Claimant Trust:

Highland Claimant Trust

c/o Highland Capital Management, L.P. 

300 Crescent Court, Suite 700 

Dallas, Texas 75201 

Attention: James P. Seery, Jr.

If to the Debtor:

Highland Capital Management, L.P. 

300 Crescent Court, Suite 700 

Dallas, Texas 75201 

Attention: James P. Seery, Jr.

with copies to:

Pachulski Stang Ziehl & Jones LLP

10100 Santa Monica Blvd., 13th Floor 

Los Angeles, CA 90067 

Telephone: (310) 277-6910 

Facsimile: (310) 201-0760 

Attn: Jeffrey N. Pomerantz, Esq.

Ira D. Kharasch, Esq.

 Gregory V. Demo, Esq. 

If to the Reorganized Debtor:

Highland Capital Management, L.P. 

300 Crescent Court, Suite 700 

Dallas, Texas 75201 

Attention: James P. Seery, Jr.

with copies to:

Pachulski Stang Ziehl & Jones LLP

10100 Santa Monica Blvd., 13th Floor 

Los Angeles, CA 90067 

Attn: Jeffrey N. Pomerantz, Esq. 

Ira D. Kharasch, Esq.

 Gregory V. Demo, Esq. 

L. Exemption from Certain Transfer Taxes Pursuant to Section 1146(a) of the 

Bankruptcy Code

To the extent permitted by applicable law, pursuant to section 1146(a) of the Bankruptcy 

Code, any transfers of property pursuant hereto shall not be subject to any Stamp or Similar Tax 

or governmental assessment in the United States, and the Confirmation Order shall direct the 

appropriate federal, state or local governmental officials or agents or taxing authority to forego 

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001341

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59

the collection of any such Stamp or Similar Tax or governmental assessment and to accept for 

filing and recordation instruments or other documents pursuant to such transfers of property 

without the payment of any such Stamp or Similar Tax or governmental assessment. Such 

exemption specifically applies, without limitation, to (i) all actions, agreements and documents 

necessary to evidence and implement the provisions of and the distributions to be made under 

this Plan; (ii) the maintenance or creation of security or any Lien as contemplated by this Plan; 

and (iii) assignments, sales, or transfers executed in connection with any transaction occurring 

under this Plan. 

M. Governing Law 

Except to the extent that the Bankruptcy Code, the Bankruptcy Rules or other federal 

law is applicable, or to the extent that an exhibit or schedule to this 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 Texas, without giving effect to the principles of 

conflicts of law of such jurisdiction; provided, however, that corporate governance matters

relating to the Debtor, the Reorganized Debtor, New GP LLC, or the Claimant Trust, as

applicable, shall be governed by the laws of the state of organization of the Debtor, the 

Reorganized Debtor, New GP LLC, or the Claimant Trustee, as applicable.

N. Tax Reporting and Compliance 

The Debtor is hereby authorized to request an expedited determination under 

section 505(b) of the Bankruptcy Code of the tax liability of the Debtor is for all taxable periods 

ending after the Petition Date through, and including, the Effective Date. 

O. Exhibits and Schedules

All exhibits and schedules to this Plan, if any, including the Exhibits and the Plan 

Documents, are incorporated and are a part of this Plan as if set forth in full herein. 

P. Controlling Document

In the event of an inconsistency between this Plan and any other instrument or document 

created or executed pursuant to this Plan, or between this Plan and the Disclosure Statement, this 

Plan shall control. The provisions of this Plan, the Disclosure Statement, and any Plan 

Document, on the one hand, and of the Confirmation Order, on the other hand, shall be construed 

in a manner consistent with each other so as to effectuate the purposes of each; provided, 

however, that if there is determined to be any inconsistency between any provision of this Plan, 

the Disclosure Statement, and any Plan Document, on the one hand, and any provision of the 

Confirmation Order, on the other hand, that cannot be so reconciled, then, solely to the extent of 

such inconsistency, the provisions of the Confirmation Order shall govern, and any such 

provisions of the Confirmation Order shall be deemed a modification of this Plan, the Disclosure 

Statement, and the Plan Documents, as applicable. 

[Remainder of Page Intentionally Blank]

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001342

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DOCS_NY:40509.39 36027/002

Dated: January 22, 2021

Respectfully submitted,

HIGHLAND CAPITAL MANAGEMENT, L.P. 

By:

James P. Seery, Jr.

Chief Executive Officer and Chief Restructuring

Officer

Prepared by: 

PACHULSKI STANG ZIEHL & JONES LLP

Jeffrey N. Pomerantz (CA Bar No.143717)

Ira D. Kharasch (CA Bar No. 109084)

Gregory V. Demo (NY Bar No. 5371992)

10100 Santa Monica Boulevard, 13th Floor

Los Angeles, CA 90067

Telephone: (310) 277-6910

Facsimile: (310) 201-0760

Email: jpomerantz@pszjlaw.com

ikharasch@pszjlaw.com

gdemo@pszjlaw.com

and 

HAYWARD & ASSOCIATES PLLC

Melissa S. Hayward (TX Bar No. 24044908)

Zachery Z. Annable (TX Bar No. 24053075)

10501 N. Central Expy, Ste. 106

Dallas, TX 75231

Telephone: (972) 755-7100

Facsimile: (972) 755-7110

Email: MHayward@HaywardFirm.com

ZAnnable@HaywardFirm.com

Counsel for the Debtor and Debtor-in-Possession

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001343

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EXHIBIT 

Appx. 0230

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Exhibit 3 Page 1 of 5

001344

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DOCS_SF:105466.2 36027/002

PACHULSKI STANG ZIEHL & JONES LLP 

Jeffrey N. Pomerantz (CA Bar No.143717) (admitted pro hac vice) 

Ira D. Kharasch (CA Bar No. 109084) (admitted pro hac vice) 

Gregory V. Demo (NY Bar No. 5371992) (admitted pro hac vice) 

10100 Santa Monica Blvd., 13th Floor 

Los Angeles, CA 90067 

Telephone: (310) 277-6910 

Facsimile: (310) 201-0760 

HAYWARD PLLC 

Melissa S. Hayward 

Texas Bar No. 24044908 

MHayward@HaywardFirm.com 

Zachery Z. Annable 

Texas Bar No. 24053075 

ZAnnable@HaywardFirm.com 

10501 N. Central Expy, Ste. 106 

Dallas, Texas 75231 

Tel: (972) 755-7100 

Fax: (972) 755-7110 

Counsel for the Debtor

IN THE UNITED STATES BANKRUPTCY COURT 

FOR THE NORTHERN DISTRICT OF TEXAS 

DALLAS DIVISION 

In re: 

HIGHLAND CAPITAL MANAGEMENT, L.P.,1

Debtor. 

) 

) 

) 

) 

) 

) 

) 

Chapter 11 

Case No. 19-34054-sgj11 

NOTICE OF OCCURRENCE OF EFFECTIVE DATE OF 

CONFIRMED FIFTH AMENDED PLAN OF REORGANIZATION 

OF HIGHLAND CAPITAL MANAGEMENT, L.P. 

PLEASE TAKE NOTICE that on February 22, 2021, the United States 

Bankruptcy Court for the Northern District of Texas (the “Bankruptcy Court”) entered the Order 

Confirming the Fifth Amended Plan of Reorganization of Highland Capital Management, L.P. 

[Docket No. 1943] (the “Confirmation Order”) confirming the Fifth Amended Plan of 

Reorganization of Highland Capital Management, L.P. (as Modified) [Docket No. 1808] (as 

1

 The Debtor’s last four digits of its taxpayer identification number are (6725). The headquarters and service address 

for the above-captioned Debtor is 300 Crescent Court, Suite 700, Dallas, TX 75201.

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 ̈1¤}HV5(+ !k«

1934054210811000000000001

Docket #2700 Date Filed: 08/11/2021

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Exhibit 3 Page 2 of 5

001345

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DOCS_SF:105466.2 36027/002 2 

amended, supplemented, or modified, the “Plan”). Unless otherwise defined in this notice, 

capitalized terms used in this notice shall have the meanings ascribed to them in the Plan and the 

Confirmation Order, as applicable. 

PLEASE TAKE FURTHER NOTICE that the Effective Date of the Plan 

occurred on August 11, 2021. 

PLEASE TAKE FURTHER NOTICE that, except with respect to Administrative 

Expense Claims that are Professional Fee Claims or as otherwise set forth in the Plan, requests for 

payment of an Administrative Expense Claim must be Filed with the Bankruptcy Court no later 

than forty-five (45) days after the Effective Date (the “Administrative Expense Claims Bar 

Date”). HOLDERS OF ADMINISTRATIVE EXPENSE CLAIMS THAT ARE REQUIRED 

TO FILE AND SERVE A REQUEST FOR PAYMENT OF SUCH ADMINISTRATIVE 

EXPENSE CLAIMS BY THE ADMINISTRATIVE EXPENSE CLAIMS BAR DATE 

THAT DO NOT FILE AND SERVE SUCH A REQUEST BY THE ADMINISTRATIVE 

EXPENSE CLAIMS BAR DATE SHALL BE FOREVER BARRED, ESTOPPED, AND 

ENJOINED FROM ASSERTING SUCH ADMINISTRATIVE EXPENSE CLAIMS 

AGAINST THE DEBTOR OR THE REORGANIZED DEBTOR. 

PLEASE TAKE FURTHER NOTICE that, unless otherwise ordered by the 

Bankruptcy Court, all final requests for payment of Professional Fee Claims must be Filed no later 

than sixty (60) days after the Effective Date. 

PLEASE TAKE FURTHER NOTICE that the terms of the Plan shall be 

immediately effective and enforceable and deemed binding upon the Debtor or the Reorganized 

Debtor, as applicable, and any and all Holders of Claims or Interests (regardless of whether such 

Claims or Interests are deemed to have accepted or rejected the Plan), all Entities that are parties 

to or are subject to the settlements, compromises, releases, and injunctions described in the Plan 

and Confirmation Order, including, without limitation: the injunction with respect to the 

commencement of claims and causes of action against Protected Parties set forth in Section IX.F 

of the Plan and Sections AA and BB of the Confirmation Order, the duration of injunction and 

stays set forth in Section IX.G of the Plan and Section AA of the Confirmation Order, and the 

continuance of the January 9 Order and July 16 Order set forth in Section IX.H of the Plan and 

Section CC of the Confirmation Order. 

PLEASE TAKE FURTHER NOTICE that on the Effective Date, all Class A 

Limited Partnership Interests, including the Class A Limited Partnership Interests held by Strand, 

as general partner, and Class B/C Limited Partnerships in the Debtor will be deemed cancelled, 

and all obligations or debts owed by, or Claims against, the Debtor on account of, or based upon, 

such Class A Limited Partnership Interests and Class B/C Limited Partnership Interests shall be 

deemed as cancelled, released, and discharged, including all obligations or duties by the Debtor 

relating to the Equity Interests in any of the Debtor’s formation documents, including the Limited 

Partnership Agreement. 

PLEASE TAKE FURTHER NOTICE that the Confirmation Order and the Plan 

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Exhibit 3 Page 3 of 5

001346

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DOCS_SF:105466.2 36027/002 3 

are available for inspection. If you would like to obtain copies you may: (a) access the Debtor’s 

restructuring website at http://www.kccllc.net/hcmlp; (b) call toll free: (877) 573-3984 or 

international: (310) 751-1829; or (c) email HighlandInfo@kccllc.com and reference “Highland” 

in the subject line. You may also obtain copies of any pleadings filed in this case for a fee via 

PACER at: pacer.uscourts.gov. 

[REMAINDER OF PAGE INTENTIONALLY BLANK] 

 

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Exhibit 3 Page 4 of 5

001347

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DOCS_SF:105466.2 36027/002 4 

Dated: August 11, 2021. PACHULSKI STANG ZIEHL & JONES LLP 

Jeffrey N. Pomerantz (CA Bar No.143717) 

Ira D. Kharasch (CA Bar No. 109084) 

Gregory V. Demo (NY Bar No. 5371992) 

10100 Santa Monica Boulevard, 13th Floor 

Los Angeles, CA 90067 

Telephone: (310) 277-6910 

Facsimile: (310) 201-0760 

Email: jpomerantz@pszjlaw.com 

 ikharasch@pszjlaw.com 

 gdemo@pszjlaw.com 

 -and- 

 

HAYWARD PLLC 

/s/ Zachery Z. Annable 

Melissa S. Hayward 

Texas Bar No. 24044908 

MHayward@HaywardFirm.com 

Zachery Z. Annable 

Texas Bar No. 24053075 

ZAnnable@HaywardFirm.com 

10501 N. Central Expy, Ste. 106 

Dallas, Texas 75231 

Tel: (972) 755-7100 

Fax: (972) 755-7110 

Counsel for the Debtor 

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Exhibit 3 Page 5 of 5

001348

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