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Plan Proponents Beware of “Death Trap” Traps in Chapter 11 Plans and Disclosure Statements

By Katharina Earle on December 22, 2016
Posted in Bankruptcy

A topic that receives relatively little attention is the practice of plan proponents to include “death trap” provisions in chapter 11 plans.  A death trap provision can provide for a distribution, or a larger distribution, to an impaired class in exchange for a favorable vote on the plan.  Although such a provision can be an…

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