The requirements, set out in Section 1129, that a plan proponent must satisfy to obtain confirmation of its Chapter 11 plan. One of those requirements is the do-or-die requirement that if any class is impaired under the plan (see Impaired Class), at least one impaired class must accept the plan by two-thirds in amount and a majority in number of those voting (see One-Impaired-Class-Must-Accept-The-Plan Rule). The proponent must also show, among other things, that:
- The plan is feasible (see Feasibility Test).
- Creditors will receive under the plan at least as much as they would receive if the debtor’s assets were liquidated under Chapter 7 (see Best Interest of Creditors Test).
If any impaired class does not accept the plan (see Accepting Class), the proponent of the plan can ask the court for a “cramdown” of the plan on the non-accepting classes (see Cramdown). A successful cramdown, however, requires a showing that the plan:
- Is fair and equitable to any non-accepting impaired class (see Fair and Equitable Test).
- Does not unfairly discriminate against any non-accepting impaired class (see Unfair Discrimination).
- Does not violate the absolute priority rule (see Absolute Priority Rule).
Bankruptcy Code § 1129. See also Absolute Priority Rule, Best Interest of Creditors Test, Chapter 11 Plan, Confirmation, Confirmation Order, Cramdown Interest Rate, Fair and Equitable Test, Feasibility Test, Impaired Class, One-Impaired-Class-Must-Accept-The-Plan Rule.