Mercy Iowa City seeks further extension of exclusive periods

By Sarah Lizee

Olympia, Wash., March 5 – Mercy Iowa City is seeking a further extension of its exclusive periods to file and solicit votes on a Chapter 11 plan, according to a motion filed Monday with the U.S. Bankruptcy Court for the Northern District of Iowa.

The company asked the court to extend the exclusive plan filing period through June 3 and the exclusive solicitation period through Aug. 5.

This is the company’s second request for an exclusivity extension, though the court still has not given an order on the first one, which sought to extend the plan filing period through March 4 and the solicitation period through May 6.

The first exclusivity motion is scheduled for hearing on March 27.

Since filing the first motion, the company said it has had discussions with trustee Computershare Trust Co., NA and bondholder representative Preston Hollow Community Capital, Inc. about plan formation. The company recently filed a new plan that has the support of Computershare and Preston Hollow.

The company said the new motion seeks to extend the exclusive periods an additional 90 days in order to avoid the significant reduction in estate resources and disruptions that would result from any creditors filing and trying to solicit a competing plan while the company’s plan is being considered.

The Iowa City-based hospital filed Chapter 11 bankruptcy on Aug. 7, 2023 under case number 23-00623.

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