Res 1993-185 - Laserfiche WebLink

Home Browse Search

I~x 7. Special Provisions Regarding Tort Claims: Notwithstanding any provision of the Plan to the contrary, in calculating the amount of an Allowed Class 4 Claim, there shall be deducted from that Claimant's Allowed Claim in Class 4 the amount of any Tort Claim that is paid or to be paid from proceeds of insurance. In no event shall the holder of a Tort Claim be entitled to more than full satisfaction of its Allowed Claim. 8. Treatment of Equity Interests: Healthcare Erown Management Co., Inc. will retain its Equity Interest in Debtor. C. Means of Execution The source of the funds for payments under the Plan is Debtor's current and future operations. Projections regarding those operations are attached as Exhibit "C". D. Reason for Payment of Unsecured, Non Priori tv Claims in Installments The Plan Proponents recognize that the holders of Allowed Unsecured Claims would prefer to have their Claims paid in full on the Effective Da':e. However, the Plan Proponents cannot propose a Plan that pays all Allowed Unsecured Claims in full on the Effective Date and also compromise the Claim of the IRS. The IRS Claim has a higher priority than General Unsecúred Claims. This means that under the rules established by the Eankruptcy Code, the IRS is entitled to have its Claim paid in full before distributions are made to Creditors of lower priority. Under the terms of the proposed compromise of the IRS Claim, the IRS will be paid $2 million on the Effective Date of the Parent Plan and the subsidiary plans and will be paid an additional $3 mill ion over six years. Because the IRS is being paid J.n installments, the IRS is unwilling to have all Claims of a lower priority paid on the Effective Date and, essentially, ahead of the IRS CIa im. A compromise of the IRS claim from approximately $29 million to $5 million is critical to the reorganization of Debtor, Healthcare, and its other subsidiaries. Only a reorganization and not a liquidation will result in a 100% distribution to unsecured creditors. Therefore, to assure that Unsecured Claims are paid in full, payments on Unsecured Claims must be made in installments. E. Claims Allowance Procedure , The procedure for claims allowance is set out in Article 9 of the Plan. F. Retention of Jurisdiction The Court retains jurisdiction as set out in Article 11 of the Plan. - 23 - a-2e1SS