How does a creditor’s committee work in a Chapter 11 bankruptcy?

Answer: In a Chapter 11 bankruptcy in Michigan, a creditors’ committee is an important part of the process. It is made up of unsecured creditors of the business that has declared bankruptcy. The committee works with the bankruptcy trustee and the debtor to protect the interests of the creditors. The creditors’ committee is responsible for representing the unsecured creditors during the bankruptcy proceedings. They investigate the debtor to determine the condition of the business and what assets are available for creditors. They also review and approve certain decisions that are made by the debtor, such as requests for additional financing or changes to the repayment plan. The creditors’ committee also works to negotiate the terms of the repayment plan with the debtor. This may include reducing or eliminating certain debts, modifying the terms of the repayment plan, or negotiating a settlement with the debtor. The creditors’ committee also reviews any proposed reorganization plans and make recommendations to the court on whether or not those plans are fair and equitable for the creditors. Finally, they are responsible for keeping the creditors informed throughout the bankruptcy process and providing updates on the progress of the negotiations.

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How does a creditor’s committee work in a Chapter 11 bankruptcy?

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