reorganization plan

(redirected from Plans of Reorganization)
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Reorganization Plan

In chapter 11 bankruptcy, a plan filed with bankruptcy court describing the process of how an insolvent company will change structurally to help it pay its debts and stay in business. This plan is subject to court oversight to ensure enforcement. Depending upon the specific plan, a company's original owner or managers may maintain control. Other times, the company's creditors become the new owners of the business; this especially happens when one or more creditors have had their debt completely discharged. Changes also must occur structurally, perhaps in risk management or marketing or perhaps in something more fundamental, to ensure that the bankruptcy does not repeat itself.

reorganization plan

A plan filed with a bankruptcy court judge by a company in Chapter 11 proceedings in which the disbursement of assets is stipulated. The plan must be approved by the firm's creditors and by the court. A reorganization plan results in new securities being given to creditors in trade for old securities.
References in periodicals archive ?
In accordance with the plans of reorganization, as of the merger date, all previously outstanding shares of common and preferred shares of Pacific Magtron International not owned by Advanced Communications were canceled and converted into the right to receive one newly issued share of common stock of Herborium Group for each share of common stock of Pacific Magtron International held as of August 11, 2006.
The Current Report also describes the terms of the settlement agreement with the former executives of Pacific Magtron International and includes the plans of reorganization and the settlement agreement as exhibits.
On June 19, 2003, PG&E announced a proposed settlement with the CPUC Staff regarding their competing plans of reorganization.
The proposed settlement agreement between the California Public Utilities Commission (CPUC) staff, and Pacific Gas and Electric Company and its parent PG&E Corporation, would resolve the competing plans of reorganization in the utility's Chapter 11 proceeding and end litigation between PG&E and the CPUC relating to the energy crisis.

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