What is a “voting plan” in a Chapter 11 bankruptcy?

A “voting plan” in Nevada’s Chapter 11 bankruptcy law refers to a plan that the creditors and a debtor create together to pay back debts. This plan must be approved by a majority of the creditors and the court. The plan usually requires the debtor to come up with a new payment schedule to pay off the debt within a certain amount of time. It may also include other provisions, such as reducing the amount of the debt, extending the terms of the loan, or adjusting interest rates. Once the plan is approved by the court, it forms the basis for the debtor’s future payment plan. Creditors are not allowed to change the terms of the plan or demand more funds from the debtor without the court’s permission. The debtor must follow the plan, and the creditors are obligated to accept the payments. The voting plan is an important part of Chapter 11 bankruptcy as it helps creditors and debtors come to a mutually beneficial agreement about repayment. It allows both parties to come to a reasonable resolution that works best for both of them. A bankruptcy court might also use a voting plan to protect creditors from the risks associated with a bankruptcy, such as a decrease in the value of the collateral. This approach aims to ensure that the creditors will receive the majority of what they are owed.

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What is a “voting plan” in a Chapter 11 bankruptcy?

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