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Omega Navigation balks at breakup fee, accuses Delos of playing games
By Caroline Salls
Pittsburgh, April 4 - Omega Navigation Enterprises, Inc. objected to a request to pay a $100,000 breakup fee to Delos Megacore Ltd. in connection with the sale of Omega's equity interests in Omega Investments, Ltd., according to an April 4 filing with the U.S. Bankruptcy Court for the Southern District of Texas.
By forcing through a $750,000, or 37.5%, reduction in its purchase price, Omega said Delos chose not to perform under its original asset purchase agreement.
"This renegotiation vitiated the breakup fee requirement and changed the factual basis relied on by this court in approving the breakup fee," the company said in its objection.
In addition, Omega said the renegotiation forced it to incur substantial additional professional fees.
The company said it has already incurred more than $100,000 in incremental professional fees as a result of Delos' actions, before even taking into account incremental committee professional fees or fees incurred in response to a sale-related motion.
"Even if the breakup fee provision had not been vitiated by Delos' conduct, it would be inequitable to saddle the debtors with an additional $100,000 expense on top of the incremental fees they have already incurred as a result of the Delos breach," the objection said.
"The motion further errs in asserting that an 8.33% break-up fee is actually only a 2.5% break-up fee, thus underscoring that Delos is continuing to play games with this court."
Omega Navigation is an Athens, Greece-based provider of marine transportation services. The company filed for bankruptcy on July 8, 2011 under Chapter 11 case number 11-35926.
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