Amsterdam House receives court approval of global settlement

By Sarah Lizee

Olympia, Wash., April 4 – Amsterdam House Continuing Care Retirement Community, Inc., which does business as the Harborside, received approval of a global settlement with the official committee of unsecured creditors, bond trustee UMB Bank, NA, bondholders and sole corporate member Amsterdam Continuing Care Health System, Inc., according to an order filed Wednesday with the U.S. Bankruptcy Court for the Eastern District of New York.

The settlement provides that Amsterdam Continuing Care Health System will incur up to $62.5 million from the net proceeds of an acceptable nursing home sale.

The bond trustee will receive $62 million from proceeds of the sale of assets to Life Care Services Communities LLC upon the earlier of the effective date of an acceptable Chapter 11 plan and the closing of the sale.

Proceeds of the settlement will be allocated pro rata by a liquidating trustee between a resident recovery (up to a maximum of $45.5 million) and an additional bond trustee recovery (the amount necessary to satisfy the bond trustee’s deficiency claim, which the bond trustee has agreed to reduce to $17 million).

Former resident refund obligations will be paid in full.

The debtor’s estate will get up to $4.75 million in funding for payment of administrative expenses and other costs.

The Port Washington, N.Y.-based retirement community builder and operator filed Chapter 11 bankruptcy for the third time on March 22, 2023 under Chapter 11 case number 23-70989.

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