reorganization plan


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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 ?
At the creditors meeting that was held today as a part of the reorganization for the Company s subsidiaries, the preliminary reorganization plan was presented by the appointed administrator, Lars SE[micro]derqvist.
In addition to the reorganization plan including a 100% payment to all creditors of the company, approval of Meruelo Maddux' reorganization plan would position the company well for its continued investment in the City of Los Angeles.
The total includes at least 169 claims that have been resolved since the bankruptcy was filed in 2004, but won't be paid unless the reorganization plan is approved, according to court records.
US Airways Chairman and CEO Doug Parker said yesterday that the assumptions underlying Delta Air Lines' standalone reorganization plan are "out of whack" and that warnings of a US/DL merger being derailed by antitrust issues are "misleading" and "superficial.
Endorsed using "super-preemptory" language to ensure that a reorganization plan did not affect insurers' rights.
For valid business reasons and pursuant to a reorganization plan, the target transfers all of its assets to the acquirer in exchange for 70% of the latter's voting stock and 30% cash.
A confirmation hearing with the bankruptcy court on Kmart's reorganization plan that was expected to be completed by April 16 could continue through about April 23, "because testimonies by people in the company are still continuing," Jack Ferry, a company spokesman, told HFN.
In September 1993, the court confirmed Savin's reorganization plan, and in December 1993, 16 months after the petition was filed, Savin emerged from bankruptcy.
The Building Congress, Coletti pointed out, has been urging the Army Engineering Corps not to close its New York operations, and he commended the new Defense Secretary for his willingness to reexamine the reorganization plan.
David Gal, EVS's Chairman said: "We believe that the reorganization plan is extremely important in building a strong management team with the skills and experience for leading the Company to meet its new challenges.
has filed a request with the bankruptcy court asking for more time to solicit votes for its reorganization plan without the threat of other parties filing competing plans.
said that all necessary creditor classes of all eight debtors in the Chapter 11 cases had voted to accept the reorganization plan.