The U.S. Trustee (UST) assigned to the Seadrill case filed with the U.S. Bankruptcy Court an objection to the Debtors’ Disclosure Statement.
The Trustee asserts, “Overall, the UST objects to Debtors’ Disclosure Statement because it lacks information and detail in critical areas which prevent creditors and interest holders from making an informed decision whether to accept, reject, or object to the Plan. First, the Disclosure Statement and underlying Plan incorrectly classify claims which are not substantially similar. Second, the Disclosure Statement does not provide adequate information regarding pre-petition insider payments/transfers. Third, the Disclosure Statement and underlying Plan do not provide an opt-out process for holders of claims or interests to avoid being bound by the releases, exculpations and injunctions (the ‘Releases’) contained in the Plan. Fourth, the Disclosure Statement and underlying Plan of Reorganization propose overly broad release, exculpation and injunction provisions without adequately providing a legal justification for them.”
In addition, “Lastly, the Motion for Approval is unclear regarding the submission of Ballots to certain claim holders. As currently drafted, the Disclosure Statement does not contain adequate information and creditors are unable to make an informed decision whether to accept, reject, or object to the Plan. Moreover, while some of the issues raised herein relate to confirmation, the Court could consider them at this stage to the extent the Disclosure Statement describes an un-confirmable Plan.”
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