Boy Scouts of America gets confirmation of amended Chapter 11 plan

By Sarah Lizee

Olympia, Wash., Sept. 8 – Boy Scouts of America received confirmation of its recently amended Chapter 11 plan on Thursday, according to an order filed with the U.S. Bankruptcy Court for the District of Delaware.

As previously reported, the most recent amendments addressed some of the language around the insurers. The insurers had objected to the amended plan in late August.

The plan includes settlements that will provide for initial funding of $2.28 billion to survivors, including $78 million from the BSA, $515 million from local councils, $30 million from the United Methodist Church and $1.66 billion from settling insurers.

In an earlier amendment to the plan, a $250 million settlement with the Church of Jesus Christ of Latter-day Saints was removed. Judge Laurie Selber Silverstein had said the releases under the settlement were too broad, and that she would not approve the settlement.

Under the plan, holders of other priority claims will receive payment in cash in full or other treatment leaving the claims unimpaired, including reinstatement.

Holders of administrative expense claims, professional fee claims and priority tax claims will be paid in full.

Holders of other secured claims will receive payment in full in cash, reinstatement of their claims, or the collateral securing their claims.

Holders of class 3A 2010 credit facility claims will receive a claim under the restated credit facility documents in an amount equal to the amount of such holder’s allowed 2010 credit facility claim.

Holders of class 3B 2019 revolving credit facility claims will receive a claim under the restated credit facility documents in an amount equal to the amount of such holder’s allowed 2019 revolver claim.

Holders of class 4A 2010 bond claims will receive a claim under the restated 2010 bond documents in an amount equal to the amount of such holder’s allowed 2010 bond claim.

Holders of class 4B 2012 bond claims will receive a claim under the restated 2012 bond documents in an amount equal to the amount of such holder’s allowed 2012 bond claim.

Holders of convenience claims will receive cash in an amount equal to 100% of their claims.

Holders of general unsecured claims will receive, subject to their option to elect convenience claim treatment, their pro rata share of the $25 million core value cash pool up to the full amount of their claims.

Holders of non-abuse litigation claims will, subject to their ability to elect convenience claim treatment, retain the right to recover up to the amount of their claims from available insurance coverage or the proceeds of any insurance policy, including any abuse insurance policy or non-abuse insurance policy, applicable proceeds of any insurance settlement agreements, and co-liable non-debtors, if any, or their insurance coverage. If holders of non-abuse litigation claims fail to recover in full from these sources, they may elect to have the unsatisfied portion of their claims treated as a convenience claim and receive cash in an amount equal to the lesser of the amount of the unsatisfied portion of the claim and $50,000.

Each holder of direct and indirect abuse claims will have their claims permanently channeled to the settlement trust.

Interests in the Delaware BSA will be reinstated.

Boy Scouts of America is based in Irving, Tex. It filed bankruptcy on Feb. 17, 2020 under Chapter 11 case number 20-10343.

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