43
Forum, lenders work out deal
The hearing on Forum’s requests to hire an interim CEO, and its former CEO as a consultant, was reset.
YOUNGSTOWN — It should be known by the end of November whether Forum Health will continue along its path of reorganization or change its focus to the merger and/or sale of its assets, a Forum attorney said Tuesday.
In the meantime, Atty. Matthew Salerno, speaking for Forum in U. S. Bankruptcy Court, said the health-care system had reached an “agreement in principle” with its major lenders allowing it to continue to use its cash collateral to operate.
Salerno predicted that the cash collateral document, which still had some language to work out, would be filed with Judge Kay Woods late Tuesday or today.
Forum filed in March for protection on Chapter 11 of the U.S. Bankruptcy Code.
The health-care system includes Northside Medical Center in Youngstown, Trumbull Memorial Hospital in Warren and Hillside Rehabilitation Hospital in Howland.
Tuesday’s hearing turned out to be short and without acrimony among attorneys.
The portion of Tuesday’s hearing that had been expected to create some fireworks — Forum’s requests to hire an interim chief executive officer and former CEO Walter “Buzz” Pishkur as a high-paid consultant — was rescheduled for next Tuesday.
Forum is seeking to retain Pishkur at a rate of up to $9,000 a week. Also, Forum wants to hire Charles W. Neumann as interim CEO.
Neumann has some 30 years of health-care business and management experience, including turnaround management, according to a Forum statement.
Salerno said the tentative agreement between Forum and its primary lenders on continuance of the hospital system’s use of its cash collateral runs through Jan. 14, 2010.
He also said the cash collateral agreement would contain milestones to be reached along the way.
Attorneys representing Forum creditors agreed with Salerno’s assessment.
“We are encouraged by discussions we’ve had with Forum during the past month and are positive about the progress,” said Atty. Amy Edgy Ferber, speaking for MBIA Insurance Corp. and on behalf of the major lenders.
Because the agreement permitting Forum to use its cash collateral expired Tuesday, the judge wanted confirmation that there would not be a break in the Forum’s use of the cash should the order not be submitted Tuesday.
Not everybody is pleased with the direction the bankruptcy procedure is taking.
“What transpired [in court] leads me to believe the lenders have gained control,” said Eric Williams, president of the Ohio Nurses Association/Youngstown General Duty Nurses Association.
“I’m deeply concerned” that the lenders’ interest is strictly financial, said Williams, whose union represents between 450 and 500 registered nurses at Northside.
He questioned if Forum’s Board of Directors would or could take care of the community’s and health-care system’s best interests.
alcorn@vindy.com