Elements Behavioral Health – Files Amended Chapter 11 Combined Plan and Disclosure Statement, $195 million in Unsecured Claims Face 0% Recovery

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November 27, 2018 – Elements Behavioral Health filed an Amended Chapter 11 Combined Plan and Disclosure Statement [Docket No. 589]. The Plan explains, “The Combined Plan and Disclosure Statement is a liquidating Chapter 11 Plan. The Combined Plan and Disclosure Statement provides that upon the Effective Date: (i) Creditor Trust Assets will be transferred to the Creditor Trust; (ii) any Acquired Assets not previously transferred to PBBH will be transferred from the Debtors to PBBH, in each instance as part of a Close of Sale; and (iii) after completing all of their ordinary course business operations and fiduciary obligations, the Reorganized Debtors will be dissolved. Thereafter, the Creditor Trust Assets will be administered and distributed as soon as practicable pursuant to the terms of the Combined Plan and Disclosure Statement. To the extent any Residual Assets remain upon the Effective Date of the Combined Plan and Disclosure Statement, the Reorganized Debtors will wind down and liquidate the Residual Assets, with any proceeds from such disposition being paid to PBBH in partial satisfaction of PBBH’s senior secured liens on the Residual Assets.”  
 
The following is a summary of classes, claims, voting rights and expected recoveries:
 
  • Class 1 (“DIP Facility Claims”) is unimpaired, deemed to accept and not entitled to vote on the Plan. The estimated aggregate amount of allowed claims is $29.9 million and the estimated recovery is 100%.
  • Class 2 (“Secured Tax Claims”) is unimpaired, deemed to accept and not entitled to vote on the Plan. The estimated aggregate amount of allowed claims is $0.00 million and the estimated recovery is 100%.
  • Class 3 (“First Lien Claims”) is impaired and is entitled to vote on the Plan. The estimated aggregate amount of allowed claims is $134,679,040.52 and the estimated recovery is 26%.
  • Class 4 (“Second Lien Claims”) is impaired and is entitled to vote on the Plan. The estimated aggregate amount of allowed claims is $47,512,247 and the estimated recovery is 0%.
  • Class 5 (“Other Secured Claims”) is unimpaired, deemed to accept and not entitled to vote on the Plan. The The estimated aggregate amount of allowed claims is $75,698 and the estimated recovery is 100%.
  • Class 6 (“Priority Claims”) is unimpaired, deemed to accept and not entitled to vote on the Plan. The estimated aggregate amount of  allowed claims is $52,312 and the estimated recovery is 100%.
  • Class 7 (“General Unsecured Claims”) is impaired and is entitled to vote on the Plan. The aggregate amount of allowed claims is approximately  $195,128,358.87 and the estimated recovery is 0%.
  • Class 8 (“Intercompany Claims”) is impaired, deemed to reject and not entitled to vote on the Plan. The estimated aggregate amount of claims is N/A and the estimated recovery is 0%. 
  • Class 9 (“Equity Interests”) is impaired, deemed to reject and not entitled to vote on the Plan. The estimated aggregate amount of claims is N/A and the estimated recovery is 0%.

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