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Orianna Health Systems Objection Filed

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Orianna Health Systems’ official committee of unsecured creditors filed with the U.S. Bankruptcy Court an objection to a Debtors motion seeking authorization to assume the restructuring support agreement (“RSA”).

The committee asserts, “The RSA is the end-result of extensive negotiations between the Debtors, the Omega Entities and the Plan Sponsor – negotiations where self-interested parties devised a restructuring transaction that casts aside the interests of unsecured creditors. Indeed, there is manifest self-dealing in these cases. The Omega Entities and the Debtors’ insiders (the ‘Plan Sponsor’) have wielded great power throughout the negotiations of the RSA, protecting their collective interests to the detriment of unsecured creditors. Moreover, given that this Court has already approved the Settlement Agreement with Omega, the DIP financing provided by Omega, and the bidding procedures for the action of the Restructuring Portfolio, the only need for the RSA at this point is to lock up Omega’s votes in an effort to cram down the self-dealing Plan on unsecured creditors.

While the RSA is plainly in the best interests of the Omega Entities and the Debtors’ insiders, it is clear from the evidentiary record in these cases that, during the course of the negotiations of the RSA, there was no independent fiduciary speaking on behalf of the unsecured creditors. As such, an insufficient record has been developed to suggest that the RSA meets the entire fairness test.”

The post Orianna Health Systems Objection Filed appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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