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I b~ C- professional staffs and the development of environments which are consumer sensitive and responsive. An additional competitive strategy of Debtor is the development of an "internal managed care" program. This program focuses on management of utilization and resources for each patient, and endeavors to work closely with payors and external managed care companies. ~ C. "Risks With Respect to Financial Pro;ections The Plan Proponents have included in this Disclosure Statement certain financial projections relating to Debtor's operations assuming confirmation of the Plan. While the Proponents believe that such projections are reasonable. there is no assurance that such projections will prove to be the case. The financial projections are based upon various assumptions. including, but not limited to, certain pricing scenarios for providing services, the availability of working capital, realization of receivables and business at levels set out in the assumptions, maintenance of certain levels of operating and administrative expenses. and settlement of tax claims with taxing authorities holding disputed claims. Although the Proponents believe that such assumptions, are reasonable, such assumptions may prove to be incorrect. . . There is always a risk that Debtor's operations will decline and Debtor will be tmable to pay its note to HealthVest. In the event of Debto.r' s default under the terms of the note. HealthVest has the option to foreclose Debtor's treatment center. Unless Debtor was able to relocate to a comparable facility. Debtor's operations and value would decline. . XIII. FEDERAL INCOME TAX CONSIDERATIONS A. General ~ FOLLOWING IS A SUMMARY OF CERTAIN OF THE SIGNIFICANT FEDERAL INCOME TAX CONSEQUENCES OF THE PLAN TO THE CREDITORS. A SPECIFIC DISCUSSION OF rOE IMPLICATIONS OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "TAX CODE") AND STATE AND L CCAL TAX LAWS ON THE CREDITORS IS BEYOND THE SCOPE OF THIS DISCLOSURE STATEMENT. IN ADDITION, THE TAX CONSEQUENCES OF THE PLAN TO THE CREDITORS MAY VARY BASED UPON THE PARTICULAR CIRCUMSTANCES OF EAŒ CREDITOR. THEREFORE, THE FOLLOWING SUMMARY IS NOT A SUBSTITUTE FOR CAREFUL TAX PUJmING AND ADVICE BASED UPON THE INDIVIDUAL CIRCUMSTANCES OF EAŒ HOLDER OF A CLAIM. ADDITIONALLY, NO RULINGS OR OPINIONS HAVE BEEN OR WILL BE REQUESTED FROM THE INTERNAL REVENUE SERVICE OR COUNSEL WITH RESPECT TO ANY OF THE TAX EFFECTS OF THE PLAN. B. Effect of Proposed IRS Settlement The IRS has asserted a substantial claim against HII and its affiliates, including the Debtor. HII filed an objection with respect to the Claim and a tentative settlement has been reached with the IRS regarding its Claim. The basic terms of the settlement provide that the IRS wi 11 be paid $5.000.000 by - 28 - a-201SS