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DISCLOSURE STATEMENT REGARDING PLAN of 10 REORGANIZATION DATED, SEPTEMBER 20, 2004 11 DATED: September 20, 2004 Susan G

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DISCLOSURE STATEMENT REGARDING PLAN of 10 REORGANIZATION DATED, SEPTEMBER 20, 2004 11 DATED: September 20, 2004 Susan G 1 IN THE UNITED STATES BANKRUPTCY COURT 2 FOR THE DISTRICT OF ARIZONA 3 4 In re: In Proceedings Under Chapter 11 5 THE ROMAN CATHOLIC CHURCH OF Case No. 4-04-04721 THE DIOCESE OF TUCSON aka THE 6 DIOCESE OF TUCSON, an Arizona corporation sole, 7 Debtor. 8 9 DISCLOSURE STATEMENT REGARDING PLAN OF 10 REORGANIZATION DATED, SEPTEMBER 20, 2004 11 DATED: September 20, 2004 Susan G. Boswell, Esq. 12 Kasey C. Nye, Esq. Quarles & Brady Streich Lang, LLP 13 One South Church Avenue Suite 1700 Tucson Arizona 85701 14 Attorneys for Debtor The Roman Catholic Church of the Diocese of 15 Tucson 16 17 18 THIS DISCLOSURE STATEMENT HAS NOT YET BEEN APPROVED BY THE BANKRUPTCY COURT AS CONTAINING ADEQUATE INFORMATION WITHIN 19 THE MEANING OF BANKRUPTCY CODE § 1125. IF YOU HAVE REQUESTED AND RECEIVED A COPY OF THE DISCLOSURE STATEMENT IN CONNECTION WITH 20 THE COURT'S HEARING TO CONSIDER APPROVAL OF THE DISCLOSURE STATEMENT, NOTHING CONTAINED HEREIN IS OR WILL BE DEEMED A 21 SOLICITATION OF ACCEPTANCE OF THE DEBTOR'S PLAN OF REORGANIZATION FILED BY THE DEBTOR. 22 23 24 25 26 1 TABLE OF CONTENTS 2 Page 3 I. INTRODUCTION...............................................................................................................1 A. The Filing of the Reorganization Case....................................................................1 4 B. Institution of Programs............................................................................................2 5 II. STATEMENTS REGARDING REPRESENTATIONS ....................................................4 6 A. Definitions And Plan Supremacy............................................................................4 B. Limited Representations..........................................................................................5 7 C. Voting Procedures ...................................................................................................6 8 III. OVERVIEW OF THE PLAN .............................................................................................8 9 A. General Structure Of The Plan ................................................................................8 B. Estimated Distributions To Creditors....................................................................10 10 IV. THE DEBTOR ..................................................................................................................12 11 A. The History and Mission of the Diocese ...............................................................12 12 B. Organizational Structure Of The Diocese .............................................................15 C. Legal Structure of the Diocese ..............................................................................18 13 D. The Financial Structure and Operations of the Diocese........................................22 14 E. The Diocese's Assets And Liabilities ....................................................................22 15 1. Assets.........................................................................................................23 (a) Real Property.................................................................................23 16 (b) Personal Property ..........................................................................23 17 (i) Accounts Receivable .........................................................23 18 (ii) St. Augustine High Catholic School..................................23 (iii) Insurance Actions ..............................................................24 19 (iv) Interest of Bishop in certain other corporations ................25 20 (v) Restricted Assets ...............................................................26 21 2. Liabilities...................................................................................................26 (a) Parish Claims.................................................................................26 22 (b) Catholic Order of Foresters ...........................................................27 23 (c) 2002 Settlement Obligations .........................................................27 24 (d) Parish Guaranty Claims.................................................................27 (e) Trade Debt.....................................................................................27 25 (f) Tort Claims....................................................................................27 26 - i - 1 TABLE OF CONTENTS (continued) 2 Page 3 F. The Sex Abuse Crisis ............................................................................................29 1. The 2002 Settlement..................................................................................30 4 2. The Current Cases .....................................................................................31 5 V. SIGNIFICANT EVENTS PRIOR TO THE REORGANIZATION CASE......................32 6 A. The Response to Childhood Sexual Abuse Crisis .................................................32 B. The Reorganization Case.......................................................................................34 7 VI. SIGNIFICANT EVENTS IN CHAPTER 11 ....................................................................35 8 VII. DESCRIPTION OF THE PLAN.......................................................................................36 9 A. Classification And Treatment Of Claims Under The Plan....................................36 1. Claim Amounts..........................................................................................36 10 2. Effective Date of the Plan..........................................................................36 11 3. Classification generally .............................................................................36 12 B. Unclassified claims................................................................................................37 1. Administrative Claims...............................................................................37 13 2. Priority Unsecured Claims ........................................................................37 14 3. Priority Tax Claims ...................................................................................38 15 C. Unimpaired Claims................................................................................................38 1. Other Secured Claims – Class 3 ................................................................38 16 2. Parish Guaranty Claims – Class 5. Unimpaired ........................................39 17 D. Impaired Claims ....................................................................................................39 18 1. Class 1: Priority Employee Unsecured Claims. .......................................39 2. Class 2: Pre-petition Date Property Tax Secured Claims..........................39 19 3. Class 4: General Unsecured Convenience Claim......................................40 20 4. Class 6: Parish Unsecured Claims............................................................40 21 5. Class 7: General Unsecured Claims ..........................................................41 6. Class 8: Other Tort and Employee Claims................................................42 22 7. Class 9: Tort Claims ..................................................................................42 23 (a) Definition of Class 9 Tort Claims .................................................42 24 (b) Treatment.......................................................................................43 (i) Determination and Treatment pursuant to the 25 Settlement Trust. ...............................................................44 26 (ii) Claim Amounts in Settlement Trust..................................45 - ii - 1 TABLE OF CONTENTS (continued) 2 Page 3 (iii) Distributions from Settlement Trust..................................45 (iv) Attorney's Fees of Settling Tort Claimants. ......................46 4 (c) Determination and Treatment of Claims in Litigation Trust.........46 5 (i) Distributions from Litigation Trust ...................................47 6 (ii) Attorney's Fees of Tort Claimants in Litigation Trust...................................................................................47 7 8. Class 10 - Penalty Claims..........................................................................47 8 VIII. Means For Execution of the Plan ......................................................................................48 A. Creation and Funding of the Settlement Trust and the Litigation Trust ...............48 9 B. Treatment of Executory Contracts ........................................................................49 10 1. Assumption and Rejection of Executory Contracts ..................................49 11 2. Claims Based on Rejection of Executory Contracts .................................49 3. Effect of Assumption of Executory Contracts ..........................................50 12 C. Funding on the Effective Date...............................................................................50 13 D. Funding After the Effective Date ..........................................................................50 14 E. Procedure for Determination of Claims Other Than Tort Claims.........................50 (a) Objections to Claims .....................................................................50 15 (b) Disputed Claims ............................................................................50 16 (c) Treatment of Contingent Claims ...................................................51 17 F. Payments Effective Upon Tender..........................................................................51
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