Cigna Health and Life Insurance Company, Cigna HealthCare of South Carolina, Cigna HealthCare of Arizona, Cigna HealthCare of New Jersey, Cigna HealthCare of Florida and Simi Valley Hospital & Health Care Services filed with the U.S. Bankruptcy Court separate objections to 21st Century Oncology Holdings’ Joint Chapter 11 Plan of Reorganization.
Simi Valley Hospital & Health Care Services asserts, “The LLC Agreement provides the Hospital with valuable membership protections, including a prohibition on the transfer, assignment or conveyance of membership interests except upon approval of the other members, and an entitlement to notice and a right of first refusal to purchase all or a pro-rata share of the selling member’s membership interest (together, the ‘ROFR Rights’)….The Hospital has raised its objections to these provisions (as well as to the Third Party Release) with the Debtors as they pertain to agreements between the Hospital and Debtor USCC being assumed because they violate both Sections 541 and 365 of the Bankruptcy Code. The Debtors have advised the Hospital that the Plan was not intended to strip these protections out of the LLC Agreement upon assumption, otherwise deprive the Hospital of their ROFR Rights, or otherwise impose the Third-Party Release on the Hospital.”
In addition, “The Hospital has provided the Debtors the outstanding amount, a description of the nature of the parties’ disputes during the past two years, and an estimate of what it believes it will incur through an Effective Date of the Plan (for a total request, in connection with disputes over the past two years, of approximately $145,000).”
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