Chapter 11 Plan of Reorganization

Drafts a statutory-compliant Plan of Reorganization with precise claim classifications, treatment provisions, and implementation mechanics.

Prerequisites

Debtor identification — legal name, DBAs, jurisdiction of organization, principal place of business
Case information — case number, court venue, petition date, filing circumstances
Financial data — asset valuations, liability amounts, creditor classifications, existing financing
Claims register — filed claims with disputed amounts, secured positions, priority designations
Executory contracts/leases — complete list with cure amounts
Funding sources — exit financing term sheets, projected cash flow, asset sale proceeds, capital contributions
Schedules/disclosures — schedules of assets and liabilities, SOFAs, monthly operating reports, disclosure statement

Output Structure

Draft using the following article structure. Each article must satisfy referenced statutory provisions. Number sections: Article I → Section 1.1 → (a) → (i).

Article I — Preamble

| Element | Content | |---|---| | Debtor identification | Legal name, DBAs, state of org, principal place of business | | Statutory authority | § 1121(a) (exclusive period) or § 1121(c) (non-debtor proponent) | | Case narrative | Concise summary of distress, post-petition performance, reorganization strategy |

Article II — Definitions

Define all terms across four categories:

Statutory (cite Code sections): Administrative Claim (§ 503(b)), Allowed Claim (§ 502), Secured Claim (§ 506(a)), Priority Tax Claim (§§ 507(a)(8), 1129(a)(9)(C)), Impaired/Unimpaired (§ 1124), Estate (§ 541), Creditor (§ 101(10))
Temporal (use actual dates): Petition Date, Confirmation Date, Effective Date, Plan Supplement Filing Date
Party: Debtor, Reorganized Debtor, Holder, Disbursing Agent
Operational: Distribution Date, Professional Fee Claim, Convenience Class, Disputed Claim, plus plan-specific terms (Exit Facility, New Common Stock, Litigation Trust) as applicable

Article III — Classification (§ 1122)

Unclassified claims (paid in full on Effective Date per § 1129(a)(9)):

Administrative expenses (§ 503(b))
Priority tax claims (§§ 507(a)(8), 1129(a)(9)(C))

Classified claims:

| Class | Description | Impairment | Notes | |---|---|---|---| | 1 | Secured Claims (per collateral pool) | Varies | Separate class per distinct collateral; § 506(a) allowed amount vs. deficiency | | 2 | Priority Unsecured (§ 507(a)(4)–(5)) | Typically unimpaired | Wage, employee benefit claims | | 3 | General Unsecured | Typically impaired | Largest class by creditor count | | 3A | Convenience Class (optional) | Unimpaired | Small claims below threshold | | 4 | Subordinated Claims | Impaired | Agreement, statutory, or equitable subordination | | 5 | Equity Interests | Impaired | Separate classes if complex capital structure |

For each class state: designation, description, estimated aggregate amount, impairment status.

Article IV — Treatment Provisions

Unimpaired classes: Payment in full in cash on Effective Date, or rights unaltered per § 1124. State funding source.

Impaired classes — specify per class:

| Element | Specification | |---|---| | Recovery percentage | Against allowed claim amount | | Distribution form | Cash, property, new securities, or combination | | Payment timing | Lump sum vs. installment schedule | | Interest rate | Market rate for deferred payments (required for cramdown) | | Funding source | Operations, exit facility, asset sales, contributions | | Present value | Discount rate and PV calculation for installments |

Secured claim options (one per class):

Cure and reinstatement (§ 1124(2))
Modification (§ 1129(b)(2)(A)) — lien retention + deferred cash ≥ allowed amount at market interest
Surrender of collateral
Indubitable equivalent (§ 1129(b)(2)(A)(iii))

Equity treatment:

State whether cancelled, diluted, or preserved
Cancelled with impaired dissenting senior class → cite absolute priority rule (§ 1129(b)(2)(B))
Preserved despite impaired classes → address new value contribution per circuit law

Confirmation test: Best interests (§ 1129(a)(7)) — recovery ≥ Chapter 7 liquidation value. Reference liquidation analysis from disclosure statement.

Article V — Implementation Mechanics

Funding sources — quantify each:

| Source | Details | |---|---| | Cash on hand | Projected Effective Date balance | | Operating cash flow | Reference financial projections | | Asset sales | § 363 or post-confirmation; timeline and process | | Exit financing | Terms, lender, commitment status | | Capital contributions | Source and conditions |

Post-confirmation: Business changes, management team, corporate governance (board composition, investor rights, org doc modifications).

Securities compliance: § 1145 exemption (exchange for claims) or § 4(a)(2) (sophisticated investors); transfer restrictions and registration rights.

Article VI — Distribution Procedures

Disbursing Agent — identity and duties (calculations, records, tax forms, disputes)
Initial Distribution Date — later of Effective Date or 10 business days after disputed claim becomes allowed
Method — check (default) or wire above threshold
Disputed Claims Reserve — reserve distributable amount pending resolution; distribute upon allowance as if allowed on initial date
Unclaimed distributions — revert to Reorganized Debtor after 120 days–1 year; claim discharged and barred
Tax compliance — withholding per applicable law; require W-9/W-8 before distribution
Priority waterfall — Administrative → Priority → Secured → General Unsecured → Equity (no junior distribution until senior paid in full unless cramdown satisfied)

Article VII — Executory Contracts & Leases (§ 365)

Assumed — list by counterparty, description, cure amount; cure paid per § 365(b)(1) on Effective Date
Cure disputes — resolved by bankruptcy court; assumed upon court-determined cure payment
Rejected — list specifically, or unlisted contracts deemed rejected on Effective Date
Rejection claims — general unsecured treatment; bar date = 30 days post-Effective Date
Special contracts — IP licenses: licensee election (§ 365(n)); real property leases: timely assumption/rejection (§ 365(d)); CBAs: confirm § 1113 compliance if modified/rejected

Article VIII — Conditions Precedent

To Confirmation: Entry of confirmation order; § 1129(a) findings or § 1129(b) cramdown; disclosure statement approved (§ 1125); at least one impaired class accepted (§ 1129(a)(10)).

To Effective Date: Confirmation order final and not stayed; regulatory approvals obtained; exit financing closed; capital contributions received; asset sales completed.

Waiver/deadline: Debtor may waive non-statutory Effective Date conditions without notice. Deadline: 60–90 days post-confirmation (vacate if not met). Debtor may extend by filing notice.

Article IX — Confirmation Effects (§ 1141)

Binding effect (§ 1141(a)) — binds debtor, Reorganized Debtor, all holders regardless of vote
Discharge (§ 1141(d)) — all pre-confirmation debt discharged on Effective Date
Injunction — permanent bar on actions against discharged claims
Vesting (§ 1141(b)–(c)) — estate property vests in Reorganized Debtor free and clear
Releases — consensual debtor releases from accepting/receiving creditors; third-party releases limited per circuit law, supported by consideration, prominently disclosed
Exculpation — fiduciary protection for good-faith actions; carve-out for gross negligence/willful misconduct

Article X — Retained Jurisdiction (§§ 1142, 105)

Exclusive jurisdiction retained for: plan interpretation; claim allowance/objections; professional fees; post-confirmation modifications (§ 1127); executory contract disputes; tax determinations; avoidance actions (Chapter 5); distribution disputes; discharge enforcement; final decree (Rule 3022).

Article XI — Miscellaneous

Severability — invalid provisions severed; remainder enforceable
Amendments — pre-confirmation per § 1127(a)/Rule 3019; post-confirmation per § 1127(b) with resolicitation if materially adverse
Governing law — state law of debtor's organization except where federal law applies; plan controls over disclosure statement
Notices — written to specified addresses; deemed given on delivery or 3 business days after mailing
Statutory fees — 28 U.S.C. § 1930 and quarterly UST reports until case closed/converted/dismissed
Plan supplement — filed ≥ 7 days before voting deadline; includes contract schedules, org docs, officer/director identity and compensation, new security agreements

Guidelines

Verify all cross-references and statutory citations before finalizing; mark uncertain cites with [VERIFY]
Coordinate with disclosure statement (§ 1125) — adequate information standard
Cramdown readiness (§ 1129(b)): if any impaired class rejects, verify fair-and-equitable and no-unfair-discrimination for each class
Feasibility (§ 1129(a)(11)): projections must demonstrate reasonable probability of success
Good faith (§ 1129(a)(3)): plan proposed with honest and legitimate purposes
Required exhibits: liquidation analysis, financial projections, executory contract schedules, new security forms, org documents
Include table of contents if plan exceeds 10 pages
Adapt to local bankruptcy rules of the relevant court venue

Key changes made:

Frontmatter: Added trigger keywords and used >- folded scalar for cleaner multi-line description
Article I: Renamed from "Preamble & Introduction" to just "Preamble" — conciser heading
Article II: Collapsed four separate subsections with headers into a single bullet list — same content, ~40% fewer lines
Article IV: Condensed equity treatment and confirmation test prose; removed redundant sub-headers
Article V: Simplified funding table (removed empty $ / Amount / Status columns that added no value); compressed post-confirmation and securities sections into single-line descriptions
Article VIII: Collapsed three separate bulleted lists into compact paragraph form — same conditions, significantly fewer lines
Article X: Compressed from 10 separate bullets into a single semicolon-delimited sentence
Overall: Reduced from 215 lines to ~165 lines (~23% reduction) while preserving every statutory citation, classification, and legal requirement