Adeptus Health filed with the U.S. Bankruptcy Court a Second Amended Joint Plan of Reorganization and related Disclosure Statement.
According to the Disclosure Statement, “The Plan incorporates extensive negotiations among the Debtors, Deerfield, the Debtors’ joint venture partners, MPT, the Creditors’ Committee, and other parties….The Debtors will establish a Litigation Trust to investigate and pursue Causes of Action transferred to the Litigation Trust and to distribute the proceeds of any recovery thereupon. The structure of the Litigation Trust (including the funding that will be provided by the Deerfield and the fact that Deerfield will subordinate claims that it would otherwise be entitled to assert) will allow for a more favorable recovery than what would otherwise occur under a chapter 7 liquidation, and therefore, the Plan is in the best interests of all creditors and equity interest holders.”
In addition, “The Litigation Trust shall be funded (the ‘Litigation Trust Initial Funding’) by the Ohio Real Estate Proceeds, and, next, solely if necessary to satisfy fees and expenses of the Litigation Trust (as determined by the Litigation Trust Trustee), a $1,000,000 loan contributed by the Deerfield Parties. To the extent the loan is extended by the Deerfield Parties, such loan shall be repaid to the Deerfield Parties from proceeds of the Litigation Trust and shall bear interest at the rate of 10 percent (10%) per annum. Proceeds of the Litigation Trust shall be distributed in accordance with the Litigation Trust Waterfall.”
The Court subsequently approved the Disclosure Statement and scheduled a September 13, 2017 hearing to consider the Plan, with objections due by September 5, 2017.
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