Obstetric and Gynecologic Associates of Iowa seeks DIP financing from insurer

Chicago, Nov. 21 – Obstetric and Gynecologic Associates of Iowa City is requesting authorization for postpetition financing, according to a motion filed with the U.S. Bankruptcy Court for the Southern District of Iowa.

The financing would come from insurer MMIC Insurance, Inc.

MMIC has already funded prepetition retainers for $250,000 to Levenfeld Pearlstein, PC and for $30,000 for Nyemaster Goode, PC.

The clinic is asking for a $1.1 million term loan. The loan would also allow for up to two $250,000 incremental increases.

Interest will be 4.5%, subject to a 2% increase as a default rate.

The term of the debtor-in-possession loan will be the earliest of one year after the petition date, the closing of the sale of assets, the effective date of any Chapter 11 plan, the appointment of a Chapter 11 trustee or examiner, conversion of the case to a Chapter 7 case or dismissal of the case.

Proceeds are earmarked for cash to finance operations and avoid any disruptions in patient care with support for the administrative expenses associated with the bankruptcy case.

The obstetric and gynecologic clinic is based in Coralville, Iowa. The Chapter 11 case number is 22-01174.

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