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ScripsAmerica Objection Filed, Termination Sought

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ScripsAmerica’s official committee of unsecured creditors filed with the U.S. Bankruptcy Court an objection to the Debtor’s motion to extend the exclusive period during which the Company can file a plan and solicit acceptances thereof and a cross motion for entry of an order terminating the Company’s exclusivity.

The committee asserts, “In accordance with the Debtor’s Bid Procedures Order, Heritage Equity Partners (HEP) began a marketing process designed to elicit the highest or otherwise best offer for the Debtor’s assets. The Marketing Process, however, failed to develop a stalking horse bid. Accordingly, the Committee has determined to proceed with the Combined Disclosure Statement and Plan that provides for the dissolution and wind-up of the affairs of the Debtor, and the transfer of any remaining estate assets to the liquidating trust. Instead of negotiating the terms of an acceptable plan of liquidation with the Committee, the Debtor has instead embarked on a process of hiring lawyers including the retention of Childress Loucks & Plunkett as Special Litigation Counsel and the expansion of the retention of Ciardi Ciardi & Astin in order to pursue various, unspecified litigations (the ‘Debtor’s Causes of Action’).”

In addition, “The Debtor’s Causes of Action, however, can be more efficiently handled by a liquidating trustee, as the Committee proposes in connection with its Combined Disclosure Statement and Plan. Moreover, the Debtor’s pursuit of the Debtor’s Causes of Action and its series of serious errors and missteps are destroying any potential value to the estate, particularly since the Debtor has not filed any budgets or operating reports, rendering it impossible for the Committee or this Court to determine whether the case is administratively solvent….Finally, the Debtor is seeking an extension of the Exclusivity Periods solely in an attempt to further disenfranchise the Committee. The Debtor’s estate and its creditors are best served by allowing the current Exclusivity Periods to terminate immediately, and thereby offering the Committee a quick and efficient manner to propose a viable chapter 11 plan.” The committee also filed with the Court a motion to file certain portions of the objection, cross motion and related confidential exhibit under seal (to remain under seal until such time as the earlier of the objection and cross motion being granted or the second exclusivity motion being denied).

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The post ScripsAmerica Objection Filed, Termination Sought appeared first on Daily Bankrupt Company Updates | Bankrupt Company News.


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