Plan Confirmation

Confirmation Roundtable: Top Tips to Confirm a Chapter 11 PlanThis roundtable will explore choices and strategies in formulating a plan, including classification, thestreamlining tools available under § 105(d), restructuring support agreements, and the murky intersection ofexculpations, releases and injunctions. The panelists will explore these topics with an eye toward sharingpractical tips for obtaining a successful confirmation.

A full panel of the distinguished Delaware Bankruptcy Court bench answering previously submitted questions from the members of the bar, providing “behind the bench” insight.

A judge, chapter 13 trustee and bankruptcy attorney will discuss how to help chapter 13 debtors succeed in chapter 13 despite increasing asset values, increased loan balances and increased expenses. This panel will delve into such issues as creating feasible plans with debtors’ ever-tighter budgets, instilling flexibility in the bankruptcy system, and dealing with asset appreciation. The panelists also will discuss options for cases that are running long in light of the Kinney decision, along with other issues that can arise.

This session will cover a number of confirmation hot topics, including the allowance of unmatured interest (Hertz), makewhole provisions, private sponsor liability risk (In re ASHINC Corp.) and D&Os (Toys “R” Us litigation).

This session will dive into mass tort cases, “Texas Two-Step” divisive mergers and the bad-faith arguments surrounding them, and equitable mootness (Talarico v. Ultra Petro. Corp. and others).

Two pairs of judges square off to consider (1) whether bankruptcies can be properly filed when a debtor faces a deluge of potential tort claims and (2) whether bankruptcy courts can support plans regarding certain special fee and financing arrangements for debtors. RESOLVED: That a bankruptcy is filed in good faith where the debtor is not otherwise in immediate financial distress and appears to have the liquidity to pay its creditors in full, but where the case is filed because of the debtor is a defendant facing a deluge of tort claims that could at some point threaten the debtor’s business and where the debtor believes that the mechanism for liquidating those claims through a trust created under a plan of reorganization will be fairer and better for all parties than the results that would otherwise obtain in the tort system. RESOLVED: That a bankruptcy court may approve a DIP financing agreement that incorporates the milestones set out in a restructuring support agreement, that provides that (a) the debtors will propose a plan that provides specified treatment to the Supporting Parties, which treatment is materially the same as the plan provides to similarly situated creditors; (b) obligates the Supporting Parties to vote in favor of the debtor’s plan and to vote against any competing plan; and (c) provides that the Supporting Parties (and only the supporting parties) will provide exit financing to the Reorganized Debtors, at rates and fees that exceed prevailing market terms.

This panel will identify recent examples of chapter 11 plans confirmed within the Ninth Circuit that contained third-party releases despite longstanding precedent in the Ninth Circuit prohibiting those releases outside of the asbestos context. The panelists also will describe the types of releases confirmed, as well as how the plan proponents were able to include the releases.

This panel will discuss Code impairment and post-petition interest, provide an update on gerrymandering (including a examination of Consolidated Land Holdings LLC), and review third-party releases and the different outcomes that have occurred in different circuits.

Post-confirmation trusts increasingly have become a popular means of obtaining plan confirmation and administering estate assets, pursuing litigation, and resolving a variety of disputes in chapter 11. While the use of post-confirmation trusts provides a host of benefits, it may provide traps for the unwary. This panel will explore issues and challenges that frequently arise in structuring and implementing post-confirmation liquidating and litigation trusts, including preservation and limitations of estate powers, analysis and pursuit of litigation, and practical challenges to winding down assets after former officers, directors and employees are no longer incentivized (or compensated) to cooperate. The panel will bring a wealth of nationwide experience to bear, along with the perspectives of post-confirmation fiduciaries, debtors and creditors alike.