Former Church Street Health secures court approval of amended plan

By Caroline Salls

Pittsburgh, March 7 - CS DIP, LLC, formerly Church Street Health Management, LLC, and its official committee of unsecured creditors received confirmation of their amended plan of reorganization, according to a Thursday filing with the U.S. Bankruptcy Court for the Middle District of Tennessee.

As previously reported, the company's debtors no longer conduct any operations. The CS DIP debtors will liquidate and wind up their affairs under the proposed plan.

The plan creates a liquidating trust from the company's remaining assets for the benefit of creditors, the disclosure statement said.

Creditor treatment

Treatment of creditors will include the following:

• Priority claims will be paid in full in cash;

• Holders of pre-bankruptcy first-lien claims, pre-bankruptcy second-lien claims and pre-bankruptcy subordinated debt claims will receive second-tier general interests in the liquidating trust, entitling them to proceeds from causes of action after specified conditions and thresholds are met;

• Holders of general unsecured claims will receive first-tier general interests in the liquidating trust, entitling them to proceeds of causes of action after conditions and thresholds are met;

• Holders of patient-related claims will be allowed to continue prosecution of the claims until establishment of a claims process under the plan.

These creditors will be entitled to some net proceeds of causes of action after specified conditions and thresholds are met.

Members of this class will be deemed to be issued patient interests in the liquidating trust. If the liquidating trust settles insurance claims, these claimants will be entitled to the net proceeds of insurance rights;

• Holders of dentists' and clinics' contribution or indemnity claims will receive no monetary distribution, but, under some circumstances, will receive non-recourse treatment related to potential claims held by holders of patient-related claims against the dentists or clinics; and

• Equity interests will be forfeited in favor of the liquidating trust, and holders will receive no distribution.

Church Street, a Nashville-based dental practice management services company, filed for bankruptcy on Feb. 20, 2012. Its Chapter 11 case number is 12-01573.

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