The U.S. Bankruptcy Court issued an order (with revisions made by the Court) approving the motion of the U.S. Trustee assigned to the ScripsAmerica case to convert the Company’s Chapter 11 reorganization to a liquidation under Chapter 7.
The order states, “The Court finds that grounds exist to convert the Chapter 11 case to a case under Chapter 7 pursuant to 11 U.S.C. section 1112(b)….The Debtor shall: Forthwith turn over to the Chapter 7 trustee all records and property of the estates under their custody and control as required by Federal Rule of Bankruptcy Procedure (FRBP) 1019 (4) and within 15 days of the date of this Order file a schedule of unpaid debts incurred after commencement of the superseded cases including the name and address of each creditor, as required by FRBP 1019 (5).”
As previously reported, the Trustee sought the conversion order on the following grounds: “The debtor-in-possession has concluded its sale efforts, with meager results, and the extensive administrative expenses being incurred in the case far exceed the sale proceeds.” This pharmaceutical’s administrator filed for Chapter 11 protection on September 7, 2016, listing $6 million in pre-petition assets.
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