Obstetric and Gynecologic Associates of Iowa eyes exclusivity extension

By Sarah Lizee

Olympia, Wash., Feb. 10 – Obstetric and Gynecologic Associates of Iowa City is seeking a 60-day extension of its exclusive periods to file and solicit votes on a Chapter 11 plan, according to a motion filed with the U.S. Bankruptcy Court for the Southern District of Iowa.

Specifically, the company asked the court to extend the exclusive plan filing period through May 1 and the exclusive solicitation period through June 28.

The debtor is engaged in a marketing process to sell its business assets as a going concern. It is also in negotiations to maximize the value of potential claims it holds against MMIC Insurance, Inc., whether through a sale process or settlement.

The debtor has also spent time responding to objections raised by judgment creditor Thomas T. Tarbox, in his capacity as conservator for the estate of S.K., a legally-incapacitated minor.

The conservator now seeks to have the case dismissed, which the debtor disputes.

“While the debtor is focused on exiting Chapter 11 under a plan as quickly as possible, the confluence of its emergency filing and subsequent litigation over preliminary issues in this case has hampered its ability to formulate a Chapter 11 plan,” the company said in its motion.

“More importantly, however, is the fact that the sale process for the debtor’s business assets is ongoing, and the debtor is working to identify an appropriate buyer for the business assets as a going concern.”

At a minimum, the process will establish the market value of the debtor’s assets for both a sale and plan process. If the debtor is unable to identify a buyer for its business assets, the best means to maximize creditor value may be through a “true reorganization,” of the debtor under a plan, the company said.

At this stage, however, it is too early to tell which route will provide the greatest benefit to creditors, the debtor stated.

A hearing is scheduled for Feb. 28.

The obstetric and gynecologic clinic is based in Coralville, Iowa. The company filed bankruptcy on Oct. 31 under Chapter 11 case number 22-01174.

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