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Page:United States Statutes at Large Volume 92 Part 2.djvu/1330

 92 STAT. 2610

PUBLIC LAW 95-598—NOV. 6, 1978, !.• i

Post, p. 2638. 11 USC 32 771 876. ' ' 11 USC 1060, 1^1„:..^,   ''

Ante, p. 2590. Ante, p. 2579. Ante, p. 2578.

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(A) to obey any lawful order of the court, other than an order to respond to a material question or to testify; . (B) on the ground of privilege against self-incrimination, to respond to a material question approved by the court or to testify, after the debtor has been granted immunity with respect to the matter concerning which such privilege was invoked;or (C) on a ground other than the property invoked privilege against self-incrimination, to respond to a material question approved by the court or to testify: (7) the debtor has committed any act specified in paragraph (2), (3), (4), (5), or (6) of this subsection, on or within one year before the date of the filing of the petition, or during the case, in connection with another case concerning an insider; (8) the debtor has been granted a discharge under this section. under section 1141 of this title, or under section 14, 371 or 476 of ^^® Bankruptcy Act, in a case commenced within six years before the date of the filing of the petition; (9) the debtor has been granted a discharge under section 1328 of this title, or under section 660 or 661 of the Bankruptcy Act, in a case commenced within six years before the date of the filing of the petition, unless payments under the plan in such case totaled at least— (A) 100 percent of the allowed unsecured claims in such case; or (B)(i) 70 percent of such claims; and (ii) the plan was proposed by the debtor in good faith, and was the debtor's best effort; or (10) the court approves a written waiver of discharge executed by the debtor after the order for relief under this chapter. (b) Except as provided in section 523 of this title, a discharge under subsection (a) of this section discharges the debtor from all debts that arose before the date of the order for relief under this chapter, and any liability on a claim that is determined under section 502 of this title as if such claim had arisen before the commencement of the case, whether or not a proof of claim based on any such debt or liability is filed under section 501 of this title, and whether or not a claim based on any such debt or liability is allowed under section 502 of this title, (c)(1) The trustee or a creditor may object to discharge under subsection (a) of this section. (2) On request of a party in interest, the court may order the trustee to examine the acts and conduct of the debtor to determine whether a ground exists for denial of discharge. (d) On request of the trustee or a creditor, and after notice and a hearing, the court shall revoke a discharge granted under subsection (a) of this section if— (1) such discharge was obtained through the fraud of the debtor, and the requesting party did not know of such fraud until after the granting of such discharge; (2) the debtor acquired property that is property of the estate, or became entitled to acquire property that would ba^ property of the estate, and knowingly and fraudulently failed to report the acquisition of, or entitlement to, such property, or to deliver or surrender such property to the trustee; or (3) the debtor committed an act specified in subsection (a)(6) of this section.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1331

 PUBLIC LAW 95-598—NOV. 6, 1978

92 STAT. 2611

(e) The trustee or a creditor may request a revocation of a discharge — (1) under subsection (d)(1) of this section, within one year after such discharge was granted; or (2) under subsection (d)(2) or (d)(3) of this section, before the later of— (A) one year after the granting of such discharge; and (B) the date the case is closed. § 728. Special tax provisions 11 USC 728. (a) For the purposes of any State or local law imposing a tax on or measured by income, the taxable period of a debtor that is an individual shall terminate on the date of the order for relief under this chapter, unless the case was converted under section 1112 of this title. (b) Notwithstanding any State or local law imposing a tax on or measured by income, the trustee shall make tax returns of income for the estate of an individual debtor in a case under this chapter or for a debtor that is a corporation in a case under this chapter only if such estate or corporation has net taxable income for the entire period after the order for relief under this chapter during which the case is pending. If such entity has such income, or if the debtor is a partnership, then the trustee shall make and file a return of income for each taxable period during which the case was pending after the order for relief under this chapter. (c) If there are pending a case under this chapter concerning a partnership and a case under this chapter concerning a partner in such partnership, a governmental unit's claim for any unpaid liability of such partner for a State or local tax on or measured by income, to the extent that such liability arose from the inclusion in such partner's taxable income, of earnings of such partnership that were not -withdrawn by such partner, is a claim only against such partnership. (d) Notwithstanding section 541 of this title, if there are pending a case under this chapter concerning a partnership and a case under this chapter concerning a partner in such partnership, then any State or local tax refund or reduction of tax of such partner that would have otherwise been property of the estate of such partner under section 541 of this title— (1) is property of the estate of such partnership to the extent that such tax refund or reduction of tax is fairly apportionable to losses sustained by such partnership and not reimbursed by such partner; and (2) is property of the estate of such partner otherwise. SUBCHAPTER III—STOCKBROKER LIQUIDATION § 741. Definitions for this subchapter i i usc 741. In this subchapter— (1) "Commission" means Securities and Exchange Commission; (2) "customer" includes— (A) entity with whom the debtor deals as principal or agent and that holds a claim against the debtor on account of a security received, acquired, or held by the debtor in the ordinary course of business as a stockbroker from or for the securities account or accounts of such entity— (i) for safekeeping; (ii) with a view to sale;

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1332

 92 STAT. 2612

PUBLIC LAW 95-598—NOV. 6, 1978

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(iii) to cover a consummated sale; a ii? (iv) pursuant to a purchase; %>.'/ . • (v) as collateral under a security agreement; or (vi) for the purpose of effecting registration of transfer; and (B) entity that holds a claim against the debtor arising 1 r out of— v (i) a sale or conversion of a security received, acquired, .,. or held as specified in subparagraph (A) of this paragraph; or (ii) a deposit of cash, a security, or other property with the debtor for the purpose of purchasing or selling a security; (3) "customer name security" means security— (A) held for the account of a customer on the date of the filing of the petition by or on behalf of the debtor; (B) registered in such customer's name on such date or in the process of being so registered under instructions from the debtor; and (C) not in a form transferable by delivery on such date; (4) "customer property" means cash, security, or other property, and proceeds of such cash, security, or property, at any time received, acquired, or held by or for the account of the debtor, from or for the securities account of a customer— (A) including— (i) property that was unlawfully converted and that is property of the estate; (ii) a security held as property of the debtor to the extent such security is necessary to meet a net equity claim based on a security of the same class and series of an issuer; (iii) resources provided through the use or realization of a customer's debit cash balance or a debit item includible in the Formula for Determination of Reserve Requirement for Brokers and Dealers as promulgated by the Commission under the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.); and (iv) other property of the debtor that any applicable law, rule, or regulation requires to be set aside or held for the benefit of a customer, unless including such property as customer property would not significantly increase customer property; but (B) not including— (i) a customer name security delivered to or reclaimed by a customer under section 751 of this title; or II (ii) property to the extent that a customer does not have a claim against the debtor based on such property; (5) "net equity" means, with respect to the aggregate of all of a customer's accounts that such customer holds in the same capacity— f (A)(i) aggregate dollar balance that would remain in such accounts after the liquidation, by sale or purchase, at the time of the filing of the petition of all securities positions in all such accounts, except customer name securities of such customer; minus (ii) any claim of the debtor against such customer that

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1333

 PUBLIC LAW 95-598—NOV. 6, 1978

92 STAT. 2613

would have been owing immediately after such liquidation; plus (B) any payment by such customer to the trustee, within 60 days after notice under section 342 of this title, of any Ante, p. 2565. business related claim of the debtor against such customer; (6) " S I P C " means Security Investor Protection Corporation. § 742. Effect of section 362 of this title in this subchapter n USC 742. Notwithstanding section 362 of this title, S I P C may file an applica- Ante, p. 2570. tion for a protective decree under the Securities Investor Protection Act of 1970 (15 U.S.C. 78aaa et seq.). The filing of such application stays all proceedings in the case under this chapter unless and until such application is dismissed. If SIPC completes the liquidation of the debtor, then the court shall dismiss the case. § 743. Notice The clerk shall give the notice required by section 342(a) of this title to SIPC and to the Commission. § 744. Executory contracts Notwithstanding section 365(d)(1) of this title, the trustee shall assume or reject, under section 365 of this title, any executory contract of the debtor for the purchase or sale of a security in the ordinary course of the debtor's business, within a reasonable time after the date of the order for relief, not to exceed 30 days. If the trustee does not assume such a contract within such time, such contract is rejected. § 745. Treatment of accounts (a) Accounts held by a particular customer in separate capacities shall be treated as accounts of separate customers. (b) If a stockbroker or a bank holds a customer net equity claim against the debtor that arose out of a transaction for a customer of such stockbroker or bank, each such customer of such stockbroker or bank shall be treated as a separate customer of the debtor. (c) A trustee's account specified as such on the debtor's books, and supported by a trust deed filed with, and qualified as such by, the Internal Revenue Service, and under the Internal Revenue Code of 1954 (26 U.S.C. 1 et seq.), shall be treated as a separate customer account for each beneficiary under such trustee account. § 746. Extent of customer claim (a) If, after the date of the filing of the petition, an entity effects, with respect to cash or a security, a transaction with the debtor, in a manner that would have made such entity a customer with respect to such cash or security had such transaction occurred before such date, and such transaction was effected by such entity in good faith and before the qualification under section 322 of this title of a trustee, such entity shall be deemed a customer, and the date of such transaction shall be deemed to be the date of the filing of the petition for the purpose of determining such entity's net equity with respect to such cash or security. (b) An entity does not have a claim as a customer to the extent that such entity has a claim for cash or a security that, by contract, agreement, understanding, or operation of law, is— (1) part of the capital of the debtor; or (2) is subordinated to the claims of any or all creditors. § 747. Subordination of certain customer claims Except as provided in section 510 of this title, unless all other cus-

11 USC 743.

i i usc 744. Ante, p. 2574.

H use 745.

.t.,, = *,

11 USC 746.

Ante, p. 2562.

11 USC 747. -Ante, p. 2586.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1334

 92 STAT. 2614

PUBLIC LAW 95-598—NOV. 6, 1978

tomer net equity claims have been paid in full, the trustee may not pay in full or pay in part, directly or indirectly, any net equity claim of a customer that was, on the date such claim arose— (1) an insider; (2) a beneficial owner of at least five percent of any class of equity securities of the debtor, other than— (A) nonconvertible stock having fixed preferential divi_ dend and liquidation rights; or '" (B) interests of limited partners in a limited partnership; (3) a limited partner with a participation of at least five percent in the net assets or net profits of the debtor; or (4) an entity that, directly or indirectly, through agreement or otherwise, exercised or had the power to exercise control over the management or policies of the debtor. 11 USC 748. § 748. Reduction of securities to money As soon as practicable after the date of the order for relief, the trustee shall reduce to money, consistent with good market practice, all securities held as property of the estate, except for customer name secuInfra. rities delivered or reclaimed under section 751 of this title. 11 USC 749. § 749. Voidable transfers Any transfer of property that, except for such transfer, would have been customer property, may be avoided by the trustee, and shall be treated as customer property, if and to the extent that the trustee avoids such transfer under section 544, 545, 547, 548, 549, or 724(a) of this title. For the purpose of such sections, the property so transferred shall be deemed to have been property of the debtor and, if such transfer was made to a customer or for a customer's benefit, such customer shall be deemed, for the purposes of this section, to have been a creditor. 11 USC 750. § 750. Distribution of securities The trustee may not distribute a security except under section 751 of this title. 11 USC 751. § 751. Customer name securities The trustee shall deliver any customer name security to or on behalf of the customer entitled to such security, unless such customer has a negative net equity. With the approval of the trustee, a customer may reclaim a customer name security after payment to the trustee, within such period as the trustee allows, of any claim of the debtor against such customer to the extent that such customer will not have a negative net equity after such payment. 11 USC 752. § 752. Customer property (a) The trustee shall distribute customer property ratably to customers on the basis and to the extent of such customers allowed net equity claims and in priority to all other claims, except claims specified Ante, p. 2583. in section 507(a)(1) of this title that are attributable to the administration of customer property. (b)(1) The trustee shall distribute customer property in excess of that distributed under subsection (a) of this section in accordance with section 726 of this title. Ante, p. 2586. (2) Except as provided in section 510 of this title, if a customer is not paid the full amount of such customer's allowed net equity claim from customer property, the unpaid portion of such claim is a claim entitled to distribution under section 726(a) of this title.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1335

 PUBLIC LAW 95-598—NOV. 6, 1978

92 STAT. 2615

(c) Subject to section 741(4)(B) of this title, any cash or security remaining after the liquidation of a security interest created under a security agreement made by the debtor shall be apportioned between the general estate and customer property in the proportion that the general property of the debtor and the cash or securities of customers were subject to such security interest. SUBCHAPTER IV—COMMODITY BROKER LIQUIDATION § 761. Definitions for this subchapter 11 USC 761. In this subchapter— (1) "Act" means Commodity Exchange Act (7 U.S.C. 1 et seq.); (2) "clearing organization" means organization that clears commodity contracts on, or subject to the rules of, a contract market or board of trade; (3) "Commission" means Commodity Futures Trading Commission; (4) "commodity contract" means— (A) if the debtor is a futures commission merchant, contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade; (B) if the debtor is a foreign futures commission merchant, foreign future; (C) if the debtor is a leverage transaction merchant, leverage transaction; (D) if the debtor is a clearing organization, contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a contract market or board of trade that is cleared by the debtor; or (E) if the debtor is a commodity options dealer, commodity option; (5) "commodity option" means agreement or transaction subject to regulation under section 4c(b) of the Act (7 U.S.C. 6c(b)); (6) "commodity options dealer" means person that extends credit to, or that accepts cash, a security, or other property from, a customer of such person for the purchase or sale of an interest in a commodity option; (7) "contract market" means board of trade designated as a contract market by the Commission under the Act; (8) "contract of sale", "commodity", "future delivery", "board of trade", and "futures commission merchant" have the meanings) assigned to those terms in the Act; (9) "customer" means— (A) if the debtor is a futures commission merchant— (i) entity for or with whom the debtor deals and that holds a claim against the debtor on account of a commodity contract made, received, acquired, or held by or through the debtor in the ordinary course of the debtor's business as a futures commission merchant from or for the commodity futures account of such entity; or (ii) entity that holds a claim against the debtor arising out of— ^,, (I) the making, liquidation, or change in the value ^ of a commodity contract of a kind specified in clause (i) of this subparagraph;

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1336

 92 STAT. 2616

\

PUBLIC LAW 95-598—NOV. 6, 1978

(II) a deposit or payment of cash, a security, or other property with the debtor for the purpose of making or margining such a commodity contract; or ( III) the making or taking of delivery on such a commodity contract; (B) if the debtor is a foreign futures commission merchant— ,': (i) entity for or with whom the debtor deals and that holds a claim against the debtor on account of a commod-K-, it ity contract made, received, acquired, or held by or through the debtor in the ordinary course of the debtor's business as a foreign futures commission merchant from or for the foreign futures account of such entity; or (ii) entity that holds a claim against the debtor arising out of— (I) the making, liquidation, or change in value of H Jc f a commodity contract of a kind specified in clause (i) of this subparagraph; ( II) a deposit or payment of cash, a security, or other property with the debtor for the purpose of making or margining such a commodity contract; or ( III) the making or taking of delivery on such a commodity contract; (C) if the debtor is a leverage transaction merchant— (i) entity for or with whom the debtor deals and that holds a claim against the debtor on account of a commodity contract engaged in by or with the debtor in the ordinary course of the debtor's business as a leverage transaction merchant from or for the leverage account of ^ such entity; (ii) entity that hold a claim against the debtor arising out of— (I) the making, liquidation, or change in value of a commodity contract of a kind specified in clause (i) of this subparagraph; (II) a deposit or payment of cash, a security, or other property with the debtor for the purpose of entering into or margining such a commodity contract; or ( III) the making or taking of delivery on such a commodity contract; " ' (D) if the debtor is a clearing organization, clearing member of the debtor with whom the debtor deals and that holds a claim against the debtor on account of cash, a security, or other property received by the debtor to margin, guarantee, or secure a commodity contract in such clearing member's proprietary account or customers' account; or (E) if the debtor is a commodity options dealer— (i) entity for or with whom the debtor deals and that holds a claim on account of a commodity contract made, received, acquired, or held by or through the debtor in the ordinary course of the debtor's business as a commodity options dealer from or for the commodity options account of such entity; or i, (ii) entity that holds a claim against the debtor arising ..,, out of—

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1337

 PUBLIC LAW 95-598—NOV. 6, 1978

92 STAT. 2617

(I) the making of, liquidation of, exercise of, or a change in vahie of, a commodity contract of a kind specified in clause (i) of this subparagraph; or (II) a deposit or payment of cash, a security, or other property with the debtor for the purpose of making, exercising, or margining such a commodity contract; (10) "customer property" means cash, a security, or other property, or proceeds of such cash, security, or property, at any time received, acquired, or held by or for the account of the debtor, from or for the account of a customer— (A) including— (i) property received, acquired, or held to margin, guarantee, secure, purchase, or sell a commodity contract; (ii) profits or contractual or other rights accruing to a customer as a result of a commodity contract; (iii) an open commodity contract; (iv) specifically identifiable customer property; (v) warehouse receipt or other document held by the debtor evidencing ownership of or title to property to be delivered to fulfill a commodity contract from or for the account of a customer; (vi) cash, a security, or other property received by the debtor as payment for a commodity to be delivered to fulfill a commodity contract from or for the account of a customer; (vii) a security held as property of the debtor to the extent such security is necessary to meet a net equity claim based on a security of the same class and series of an issuer; (viii) property that was unlawfully converted and that is property of the estate; and (ix) other property of the debtor that any applicable law, rule, or regulation requires to be set aside or held for the benefit of a customer, unless includina: such property as customer property would not significantly increase customer property; but (B) not including property to the extent that a customer does not have a claim against the debtor based on such property; (11) "foreign future" means contract for the purchase or sale of a commodity for future delivery on, or subject to the rules of, a board of trade outside the United States; (12) "foreign futures commission merchant" means entity engaged in soliciting or accepting orders for the purchase or sale of a foreign future or that, in connection with such a solicitation or acceptance, accepts cash, a security, or other property or extends credit, to margin, guarantee, or secure any trade or contract that results from such a solicitation or acceptance; (13) "leverage transaction" means agreement that is subject to regulation under section 217 of the Commodity Futures Trading Commission Act of 1974 (7 U.S.C. 15a), and that is commonly known to the commodities trade as a margin account, margin contract, leverage account, or leverage contract; (14) "leverage transaction merchant" means person that is engaged in the business of engaging in leverage transactions;

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1338

 92 STAT. 2618

PUBLIC LAW 95-598—NOV. 6, 1978

(15) "margin payment" means payment or deposit of cash, a security, or other property, that is commonly known to the commodities trade as original margin, initial margin, maintenance margin, or variation margin, including a daily variation settlement payment; (16) "member property" means customer property at any time received, acquired, or held by or for the account of a debtor that is a clearing organization, from or for the proprietary account of a customer that is a clearing member of the debtor; and (17) "net equity" means, subject to such rules and regulations as the Commission promulgates under the Act, with respect to the aggregate of all of a customer's accounts that such customer holds in the same capacity— (A) balance remaining in such customer's accounts immediately after— (i) all commodity contracts of such customer have been transferred, liquidated, or become identified for delivery; and (ii) all obligations of such customer to the debtor have been offset; plus (B) the value, as of the date of return under section 766 of this title, of any specifically identifiable customer property actually returned to such customer before the date specified in subparagraph (A) of this paragraph; plus (C) the value, as of the date of transfer, of— (i) any commodity contract to winch such customer is entitled that is transferred to another person under section 766 of this title; and (ii) any cash, security, or other property of such customer transferred to such other person under section 766 of this title to margin or secure such transferred commodity contract. 11 USC 762. § 762. Notice to the Commission and right to be heard Ante, p. 2565 (a) The clerk shall give the notice required by section 342 of this title to the Commission. (b) The Commission may raise and may appear and be heard on any issue in a case under this chapter. 11 USC 763. § 763. Treatment of accounts (a) Accounts held by a particular customer in separate capacities shall be deemed to be accounts of separate customers. (b) A member of a clearing organization shall be deemed to hold such member's proprietary account in a separate capacity from such member's customers' account. (c) The net equity in a customer's account may not be offset against the net equity in the account of any other custonier. 11 USC 764. § 764. Voidable transfers (a) Except as otherwise provided in this section, any transfer of property that, except for such transfer, would have been customer property, may be avoided by the trustee, and shall be treated as customer property, if and to the extent that the trustee avoids such transAnte, pp. 2596, fer under section 544, 545, 547, 548, 549, or 724(a) of this title. For the 2597. purpose of such sections, the property so transferred is deemed to have been property of the debtor, and, if such transfer was made to a customer or for a customer's benefit, such customer is deemed, for the purposes of this section, to have been a creditor.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1339

 PUBLIC LAW 95-598—NOV. 6, 1978

92 STAT. 2619

(b) Notwithstanding sections 544, 545, 547, 548, 549, and 724(a) of this title, the trustee may not avoid a transfer made before five days after the date of the filing of the petition, if such transfer is approved by the Commission by nue or order, either before or after such transfer, and if such transfer is— (1) a transfer of a commodity contract entered into or carried by or through the debtor on behalf of a customer, and of any cash, securities, or other property margining or securing such commodity contract; or (2) the liquidation of a commodity contract entered into or carried by or through the debtor on behalf of a customer. (c) Notwithstanding sections 544, 545, 547, 548, and 724(a) of this title, the trustee may not avoid a transfer that is a margin payment to or deposit with a commodity broker or forward contract merchant or is a settlement payment made by a clearing organization and that occurs before the commencement of the case, except under section 548 r a)(l) of this title. § 765. Customer instructions (a) The notice under section 342 of this title to customers shall instruct each customer— (1) to file a proof of such customer's claim promptly, and to specify in such claim any specifically identifiable security, property, or commodity contract; and (2) to instruct the trustee of such customer's desired disposition, including transfer under section 766 of this title or liquidation, of any commodity contract specifically identified to such customer. (b) The trustee shall comply, to the extent practicable, with any instruction received from a customer regarding such customer's desired disposition of any commodity contract specifically identified to such customer. If the trustee has transferred, under section 766 of this title, such a commitment, the trustee shall transmit any such instruction to the commodity broker to whom such commodity contract was so transferred. § 766. Treatment of customer property (a) The trustee shall answer all margin calls with respect to a specifically identifiable commodity contract of a customer until such time as the trustee returns or transfers such commodity contract, but the trustee may not make a margin payment that has the effect of a distribution of more than that to which such customer is entitled under subsection (h) or (i) of this section. (b) The trustee shall prevent any open commodity contract that is bein^ a^ctively traded as of the date of the filing of the petition from remaining open after the last day of trading in such commodity contract, or into the first day on which notice of intent to deliver on such commodity contract may be tendered, whichever occurs first. With respect to any commodity contract that has remained open after the last day of trading in such commodity contract or v>^ith respect to which delivery must be made or accepted under the rules of contract market on which such commodity contract was made, the trustee may operate the business of the debtor for the purpose of— (1) accepting or making tender of notice of intent to deliver the physical commodity underlying such commodity contract; (2) facilitating delivery of such commodity; or (3) disposing of such commodity if a party to such commodity contract defaults.

Ante, pp. 2596, 2597.

11 USC 765. Ante, p. 2565.

Infra.

11 USC 766.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1340

 92 STAT. 2620 ,c

PUBLIC LAW 95-598—NOV. 6, 1978

(c) The trustee shall return promptly to a customer any specifically identifiable security, property, or commodity contract to which such customer is entitled, or shall transfer, on such customer's behalf, such security, property, or commodity contract to a commodity broker that is not a debtor under this title, subject to such rules or regulations as the Commission may prescribe, to the extent that the value of such • security, property, or commodity contract does not exceed the amount to which such customer would be entitled under subsection (h) or (i) of this section if such security, property, or commodity contract were not returned or transferred under this subsection. (d) If the value of a specifically identifiable security, property, or commodity contract exceeds such amount, then the customer to whom such security, property, or commodity contract is specifically identified may deposit cash with the trustee equal to the difference between the value of such security, property, or commodity contract and such amount, and the trustee shall— (1) return promptly such security, property, or commodity contract to such customer; or (2) transfer, on such customer's behalf, such security, property, •i-' ' - •or commodity contract to a commodity broker that is not a debtor under this title, subject to such rules or regulations as the Commission may prescribe. (e) Subject to subsection (b) of this section, the trustee shall liquidate any commodity contract that— (1) is identified to a particular customer and with respect to which such customer has not timely instructed the trustee as to the desired disposition of such commodity contract; (2) cannot be transferred under subsection (c) of this section; or (3) cannot be identified to a particular customer. (f) As soon as practicable after the commencement of the case, the trustee shall reduce to money, consistent with good market practice, all securities and other property, other than commodity contracts, held as property of the estate, except for specifically identifiable securities or property distributable under subsection (h) or (i) of this section. (g) The trustee may not distribute a security or other property except under subsection (h) or (i) of this section. (h) Except as provided in subsection (b) of this section, the trustee shall distribute customer property ratably to customers on the basis and to the extent of such customers' allowed net equity claims, and in priority to all other claims, except claims of a kind specified in Ante, p. 2583. section 507(a)(1) of this title that are attributable to the administration of customer property. Such distribution shall be in the form of— (1) cash; (2) the return or transfer, under subsection (c) or (d) of this section, of specifically identifiable customer securities, property, or commodity contracts; or (3) payment of margin calls under subsection (a) of this section. (i) If the debtor is a clearing organization, the trustee shall distribute— (1) customer property, other than member property, ratably to customers on the basis and to the extent of such customers' allowed net equity claims based on such customers' accounts other than proprietary accounts, and in priority to all other claims, except claims of a kind specified in section 507(a)(1) of this title that are attributable to the administration of such customer property; and

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1341

 PUBLIC LAW 95-598—NOV. 6, 1978

92 STAT. 2621

(2) member property ratably to customers on the basis and to the extent of such customers' allowed net equity claims based on such customers' proprietary accounts, and in priority to all other claims, except claims of a kind specified in section 507(a)(1) -Ante, p. 2583. of this title that are attributable to the administration of member property or customer property, (j)(1) The trustee shall distribute customer property in excess of that distributed under subsection (h) or (i) of this section in accordance with section 726 of this title. ' ' ' *' **" *' (2) Except as provided in section 510 of this title, if a customer is not paid the full amount of such customer's allowed net equity claim from customer property, the unpaid portion of such claim is a claim entitled to distribution under section 726(a) of this title.

CHAPTER 9—ADJUSTMENT OF DEBTS OF A MUNICIPALITY SUBCHAPTER I—GENERAL PROVISIONS Sec.

901. 902. 903. 904.

Applicability of other sections of this title. Definitions for this chapter. Reservation of State power to control municipalities. Limitation on jurisdiction and powers of court. SUBCHAPTER II—ADMINISTRATION

921. 922. 923. 924. 925. 926. 927.

Filing of plan. Modification of plan. Confirmation. < v Effect of confirmation. Continuing jurisdiction and closing of the case. Effect of exchange of securities before the date of the filing of the petition.

' ' ''

Petition and proceedings relating to petition. Automatic stay of enforcement of claims against the debtor. Notice. List of creditors. Effect of list of claims. Avoiding powers. Dismissal. SUBCHAPTER III — THE PLAN

941. 942. 943. 944. 945. 946.

'

^r;, *..;

SUBCHAPTER I—GENERAL PROVISIONS § 901. Applicability of other sections of this title (a) Sections 301, 344, 347(b), 349, 350(b), 361, 362, 364(c), 364(d), 364(e), 364(f), 365, 366, 501, 502, 503, 504, 506, 50r(a)(1), 509, 510, 524(a)(1), 524(a)(2), 544, 545, 546, 547, 548, 549(a), 549(c), 549(d), 550, 551, 552, 553, 1102, 1103, 1109, 1111(b) 1122, 1123(a)(1), 1123(a) (2), 1123(a)(3), 1123(a)(4), 1123(a)(5), 1123(b), 1124, 1125, 1126 (a), 1126(b), 1126(c), 1126(e), 1126(f), 1126(g), 1127(d), 1128, 1129 (a)(2), 1129(a)(3), 1129(a)(8), 1129(a) (10), 1129(b)(1), 1129(b) (2)(A), 1129(b)(2)(B), 1142(b), 1143, 1144, and 1145 of this title apply in a case under this chapter. (b) A term used in a section of this title made applicable in a case under this chapter by subsection (a) of this section or section 103(e) of this title has the meaning defined for such term for the purpose of such applicable section, unless such term is otherwise defined in section 902 of this title.

H USC 901. Ante, pp. 2558, 2565, 2568-2570, tlH „.no iHTf^d 2592! 2596! 2597, 2600-2602.

Ante, p. 2555.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1342

 92 STAT. 2622

11 USC 902. Ante, p. 2555.

11 USC 903.

11 USC 904.

''

PUBLIC LAW 95-598—NOV. 6, 1978 (c) A section made applicable in a case under this chapter by subsection (a) of this section that is operative if the business of the debtor is authorized to be operated is operative in a case under this chapter. § 902. Definitions for this chapter In this chapter— (1) "property of the estate", when used in a section that is made applicable in a case under this chapter by section 103(e) or 901 of this title, means property of the debtor; (2) "special tax payer" means record owner or holder of title, legal or equitable, to real property against which has been levied a special assessment or special tax the proceeds of which are the sole source of payment of an obligation issued by the debtor to defray the cost oi an improvement relating to such real property; (3) "special tax payer affected by the plan" means special tax payer with respect to whose real property the plan proposes to increase the proportion of special assessments or special taxes referred to in paragraph (2) of this section assessed against such real property; and (4) "trustee", when used in a section that is made applicable in a case under this chapter by section 103(e) or 901 of this title, means debtor, except as provided in section 926 of this title. § 903. Reservation of State power to control municipalities This chapter does not limit or impair the power of a State to control, by legislation or otherwise, a municipality of or in such State in the exercise of the political or governmental powers of such municipality, including expenditures for such exercise, but— (1) a State law prescribing a method of composition of indebtedness of such municipality may not bind any creditor that does not consent to such composition; and (2) a judgment entered under such a law may not bind a creditor to that does not consent to such composition. § 904. Limitation on jurisdiction and powers of court Notwithstanding any power of the court, unless the debtor consents or the plan so provides, the court may not, by any stay, order, or decree, in the case or otherwise, interfere with— (1) any of the political or governmental powers of the debtor; (2) any of the property or revenues of the debtor; or (3) the debtor's use or enjoyment of any income-producing property. SUBCHAPER II—ADMINISTRATION

11 USC 921. § 921. Petition and proceedings relating to petition Ante, pp. 2557, (a) Notwithstanding sections 109(c) and 301 of this title, a case 2558. under this chapter concerning an unincorporated tax or special assessment district that does not have such district's own officials is commenced by the filing under section 301 of this title of a petition under this chapter by such district's governing authority or the board or body having authority to levy taxes or assessments to meet the obligations of such district. (b) The chief judge of the court of appeals for the circuit embracing the district in which the case is commenced shall designate the bankruptcy judge to conduct the case.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1343

 PUBLIC LAW 95-598—NOV. 6, 1978 (c) After an objection to the petition, the court, after notice and a hearing, may dismiss the petition, if the debtor did not file the petition in good faith, or if the petition does not meet the requirements of this title. (e) If the petition is not dismissed under subsection (d) of this section, the court shall order relief under this chapter. (f) The court may not, on account of an appeal from an order for relief, delay any proceeding under this chapter in the case in which the appeal is being taken; nor shall any court order a stay of such proceeding pending such appeal. The reversal on appeal of a finding of jurisdiction does not affect the validity of any debt incurred that is authorized by the court under section 364:(c) or 364(d) of this title, § 922. Automatic stay of enforcement of claims against the debtor (a) A petition filed under this chapter operates as a stay, in addition to the stay provided by section 362 of this title, applicable to all entities, of— (1) the commencement or continuation, including the issuance or employment of process, of judicial, administrative, or other proceeding against an officer or inhabitant of the debtor that seeks to enforce a claim against the debtor; and (2) the enforcement of a lien on or arising out of taxes or assessments owed to the debtor. (b) Subsections (c), (d), (e), (f), and (g) of section 362 of this title apply to a stay under subsection (a) of this section the same as such subsections apply to a stay under section 362(a) of this title. § 923. Notice There shall be given notice of the commencement of a case under this chapter, notice of an order for relief under this chapter, and notice of the dismissal of a case under this chapter. Such notice shall also be published at least once a week for three successive weeks in at least one newspaper of general circulation published within the district in which the case is commenced, and in such other newspaper having a general circulation among bond dealers and bondholders as the court designates. § 924. List of creditors The debtor shall file a list of creditors. § 925. Effect of list of claims A proof of claim is deemed filed under section 501 of this title for any claim that appears in the list filed under section 924 of this title, except a claim that is listed as disputed, contingent, or unliquidated. § 926. Avoiding powers If the debtor refuses to pursue a cause of action under section 544, 545, 547, 548, 549(a), or 550 of this title, then on request of a creditor, the court may appoint a trustee to pursue such cause of action. § 927. Dismissal (a) After notice and a hearing, the court may dismiss a case under this chapter for cause, including— (1) want of prosecution; (2) unreasonable delay by the debtor that is prejudicial to creditors; (3) failure to propose a plan within the time fixed under section 941 of this title;

92 STAT. 2623

Ante, p. 2574. H USC 922. Ante, p. 2570. y.

•,,•

•''

' '•

11 USC 923.

11 USC 924. 11 USC 925.

11 USC 926. Ante, pp. 2596, 2597, 2600, 2601. 11 USC 927. Notice and hearing.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1344

 92 STAT. 2624

PUBLIC LAW 95-598—NOV. 6, 1978 (4) if a plan is not accepted within any time fixed by the court; (5) denial of confirmation of a plan under section 943(b) of this title and denial of additional time for filing another plan or a modification of a plan; or (6) if the court has retained jurisdiction after confirmation of apian— (A) material default by the debtor with respect to a term of such plan; or (B) termination of such plan by reason of the occurrence of a condition specified in such plan. (b) The court shall dismiss a case under this chapter if confirmation is refused. SUBCHAPTER III — THE PLAN

11 USC 941.

11 USC 942.

11 USC 943.

Ante, p. 2555.

Ante, p. 2583.

11 USC 944.

Ante, p. 2578. Ante, p. 2579.

§ 941. Filing of plan The debtor shall file a plan for the adjustment of the debtor's debts. If such a plan is not filed with the petition, the debtor shall file such a plan at such later time as the court fixes. § 942. Modification of plan The debtor may modify the plan at any time before confirmation, but may not modify the plan so that the plan as modified fails to meet the requirements of this chapter. After the debtor files a modification, the plan as modified becomes the plan. § 943. Confirmation (a) A special tax payer may object to confirmation of a plan. (b) The court shall confirm the plan if— (1) the plan complies with the provisions of this title made applicable by sections 103(e) and 901 of this title; (2) the plan complies with the provisions of this chapter; (3) all amounts to be paid by the debtor or by any person for services or expenses in the case or incident to the plan have been fully disclosed and are reasonable; (4) the debtor is not prohibited by law from taking any action necessary to be taken to carry out the plan; (5) the plan provides that each holder of a claim of the kind specified in section 507(a)(1) of this title will receive, on account of such claim, property of a value, as of the effective date of the plan, equal to the allowed amount of such claim, except to the extent that the holder of a particular claim of such kind has waived such payment on such claim; and (6) the plan is in the best interests of creditors and is feasible. § 944. Effect of confirmation (a) The provisions of a confirmed plan bind the debtor and any creditor, whether or not— (1) a proof of such creditor's claim is filed or deemed filed under section 501 of this title; (2) such claim is allowed under section 502 of this title; or (3) such creditor has accepted the plan. (b) Except as provided in subsection (c) of this section, the debtor is discharged from all debts as of the time when— (1) the plan is confirmed; (2) the debtor deposits any consideration to be distributed under the plan with a disbursing agent appointed by the court; and (3) the court has determined—

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1345

 PUBLIC LAW 95-598—NOV. 6, 1978

92 STAT. 2625

(A) that any security so deposited will constitute, after distribution, a valid legal obligation of the debtor; and (B) that any provision made to pay or secure payment of such obligation is valid. (c) The debtor is not discharged under subsection (b) of this section from any debt— (1) excepted from discharge by the plan or order confirming the plan; or (2) owed to an entity that, before confirmation of the plan, had neither notice nor actual knowledge of the case. § 945. Continuing jurisdiction and closing of the case H USC 945. (a) The court may retain jurisdiction over the case for such period of time as is necessary for the successful execution of the plan. (b) Except as provided in subsection (a) of this section, the court shall close the case when administration of the case has been completed. § 946. Effect of exchange of securities before the date of the filing H USC 946. of the petition The exchange of a new security under the plan for a claim covered by the plan, whether such exchange occurred before or after the date of the filing of the petition, does not limit or impair the effectiveness of the plan or of any provision of this chapter. The amount and number specified in section 1126(c) of this title include the amount and number of claims formerly held by a creditor that has participated in any such exchange.

CHAPTER 11—REORGANIZATION SUBCHAPTER I—OFFICERS AND ADMINISTRATION Sec.

1101. 1102. 1103. 1104. 1105. 1106. 1107. 1108. 1109. 1110. 1111. 1112.

Definitions for this chapter. Creditors' and equity security holders' committees. Powers and duties of committees. Appointment of trustee or examiner. Termination of trustee's appointment. Duties of trustee and examiner. Rights, powers, and duties of debtor in possession. Authorization to operate business. Right to be heard. Aircraft equipment and vessels. Claims and interests. Conversion or dismissal.

f

SUBCHAPTER II—THE PLAN 1121. 1122. 1123. 1124. 1125. 1126. 1127. 1128. 1129.

Who may file a plan. Classification of claims or interests. Contents of plan. Impairment of claims or interests. Postpetition disclosure and solicitation. Acceptance of plan. Modification of plan. Confirmation hearing. Confirmation of plan. SUBCHAPTER III—POSTCONFIRMATION MATTERS

1141. 1142. 1143. 1144. 1145. 1146.

Effect of confirmation. Execution of plan. Distribution. Revocation of an order of confirmation. Exemption from securities laws. Special tax provisions.

aQ-lQ4 n _ 8 n _ n t 9.

8R • oi\n

-,.

, i

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1346

 92 STAT. 2626

PUBLIC LAW 95-598—NOV. 6, 1978 SUBCHAPTER IV—RAILROAD REORGANIZATION Sec. 1161. 1162. 1163. 1164. 1165. 1166.

,:;'•

1167. 1168. 1169. 1170. 1171. 1172. 1173. 1174.

Inapplicability of other sections. Definition. Appointment of trustee. Right to be heard. Protection of the public interest. Effect of Interstate Commerce Act and of Federal, State, or local regulations. Collective bargaining agreements. Rolling stock equipment. Effect of rejection of lease of railroad line. Abandonment of railroad line. - .Priority claims. Contents of plan. Confirmation of plan. . ' Liquidation.

SUBCHAPTER I—OFFICERS AND ADMINISTRATION 11 USC 1101. Ante, p. 2562.

11 USC 1102.

§ 1101. Definitions for this chapter In this chapter— (1) "debtor in possession" means debtor except when a person that has qualified under section 322 of this title is serving as trustee in the case; (2) "substantial consummation" means— ^v i... (A) transfer of all or substantially all of the property proposed by the plan to be transferred; (B) assumption by the debtor or by the successor to the debtor under the plan of the business or of the management of all or substantially all of the property dealt with by the plan; and (C) commencement of distribution under the plan. § 1102. Creditors' and equity security holders' committees (a)(1) As soon as practicable after the order for relief under this chapter, the court shall appoint a committee of creditors holding unsecured claims. (2) On request of a party in interest, the court may order the appointment of additional committees of creditors or of equity security holders if necessary to assure adequate representation of creditors or of equity security holders. The court shall appoint any such committee. (b)(1) A committee of creditors appointed under subsection (a) of this section shall ordinarily consist of the persons, willing to serve, that hold the seven largest claims against the debtor of the kinds represented on such committee, or of the members of a committee organized by creditors before the order for relief under this chapter, if such committee was fairly chosen and is representative of the different kinds of claims to be represented. (2) A committee of equity security holders appointed under subsection (a)(2) of this section shall ordinarily consist of the persons, willing to serve, that hold the seven largest amounts of equity securities of the debtor of the kinds represented on such committee. (c) On request of a party in interest and after notice and a hearing, the court may change the membership or the size of a committee appointed under subsection (a) of this section if the membership of such committee is not representative of the different kinds of claims or interests to be represented.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1347

 PUBLIC LAW 95-598—NOV. 6, 1978

92 STAT. 2627

§ 1103. Powers and duties of committees H USC 1103. (a) At a scheduled meeting of a committee appointed under section 1102 of this title, at which a majority of the members of such committee are present, and with the court's approval, such committee may select and authorize the employment by such committee of one or more attorneys, accountants, or other agents, to represent or perform services for such committee. (b) A person employed to represent a committee appointed under section 1102 of this title may not, while employed by such committee, represent any other entity in connection with the case. (c) A committee appointed under section 1102 of this title may— (1) consult with the trustee or debtor in possession concerning the administration of the case; (2) investigate the acts, conduct, assets, liabilities, and financial condition of the debtor, the operation of the debtor's business and the desirability of the continuance of such business, and any other matter relevant to the case or to the formulation of a plan; (3) participate in the formulation of a plan, advise those represented by such committee of such committee's recommendai, tions as to any plan formulated, and collect and file with the court acceptances of a plan; (4) request the appointment of a trustee or examiner under section 1104 of this title, if a trustee or examiner, as the case may ^"fi^ be, has not previously been appointed under this chapter in the case; and (5) perform such other services as are in the interest of those represented. (d) As soon as practicable after the appointment of a committee under section 1102 of this title, the trustee shall meet with such committee to transact such business as may be necessary and proper. § 1104. Appointment of trustee or examiner ^^ ^^^ ^^^'** (a) At any time after the commencement of the case but before confirmation of a plan, on request of a party in interest, and after notice and a hearing, the court shall order the appointment of a trustee— (1) for cause, including fraud, dishonesty, incompetence, or gross mismanagement of the affairs of the debtor by current management, either before or after the commencement of the case, or similar cause, but not including the number of holders of securities of the debtor or the amount of assets or liabilities of ' the debtor; or (2) if such appointment is in the interests of creditors, any equity security holders, and other interests of the estate, without regard to the number of holders of securities of the debtor or the amount of assets or liabilities of the debtor. (b) If the court does not order the appointment of a trustee under this section, then at any time before the confirmation of a plan, on request of a party in interest, and after notice and a hearing, the court shall order the appointment of an examiner to conduct such an investigation of the debtor as is appropriate, including an investigation of any allegations of fraud, dishonesty, incompetence, misconduct, mismanagement, or iregularity in the management of the affairs of the debtor of or by current or former management of the debtor, if— (1) such appointment»is in the interests of creditors, any equity

security holders, and other interests of the estate; or

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Page:Folk-lore - A Quarterly Review. Volume 10, 1899.djvu/252

 214 preparation of the paint, by the aid of which he hoped to outwit the eagle. When Funny-boy felt the strain on the basket he let go, as his brother desired, and the eagle bore Benign-face off in it. When it had ascended a little way, it let the basket drop. It repeated this manœuvre several times, intending thereby to kill Benign-face. The latter, when the eagle had dropped him a time or two, put the red paint in one side of his mouth and the white in the other, and the saliva, mixing with and liquifying it, the paint began to flow from the corners of his mouth. The eagle, perceiving this, thought it to be his blood and brains oozing from his mouth, and thinking that he was killed, straightway carried him off to its nest on the mountain to its two young ones. Leaving him thus in the nest, it flew away again. As soon as it was out of sight, Benign-face cut two holes in the basket for his arms, and putting his hands through, he seized an eaglet by the legs in each, and forced them to fly off with him to where his two brothers were awaiting him. Still holding the birds by their legs, he bade his brothers cut the basket from him; and when he was free, he shook the two eaglets so hard that all their bones fell out, leaving the empty skins in his hands. These he made his brothers put on, telling them they would be quite safe in them. He himself then assumed the form of a dog, only where the tail should have been, he stuck a long and sharp double-bladed jade knife; and in the place of the ears he stuck two similar but smaller knives; and where the dog's fore-claws would be, he stuck other still smaller ones. Being thus prepared for the encounters he knew awaited him, he boldly entered the village. Now the animals of this country were different from those elsewhere; they all partook of the nature of dogs, and were employed as such by the people. There were bear-dogs, grizzly-dogs, wolf-dogs, rattlesnake-dogs, and all other kinds of dogs. As soon as Benign-face in his dog form was perceived, some one cried out: "Here's a strange dog, let us have a dog-fight." One of the smaller dogs was turned loose and set on to worry the stranger. But Benign-face ran at it, and ripped it up with his sharp stone ears in a trice. Then another, and another, sprang at him; but he served them all in the same way, and presently there was only the rattlesnake-dog left. This he had to fight in a different manner. Instead of rushing at it, as he had at all the others, he began dancing round it and pawing the ground, as if in play. These antics put the


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Page:United States Statutes at Large Volume 92 Part 2.djvu/1348

 92 STAT. 2628 .:;s: jti-!

PUBLIC LAW 95-598—NOV. 6, 1978

(2) the debtor's fixed, liquidated, unsecured debts, other than debts for goods, services, or taxes, or owing to an insider, exceed $5,000,000. (c) If the court orders the appointment of a trustee or an examiner, if a trustee or an examiner dies or resigns during the case or is removed Ante, p. 2562. under section 324 of this title, or if a trustee fails to qualify under Ante, p. 2562. section 322 of this title, then the court shall appoint one disinterested person to serve as trustee or examiner, as the case may be, in the case. 11 USC 1105. § 1105. Termination of trustee's appointment At any time before confirmation of a plan, on request of a party in interest, and after notice and a hearing, the court may terminate the trustee's appointment and restore the debtor to possession and management of the property of the estate, and operation of the debtor's business. 11 USC 1106. §1106. Duties of trustee and examiner (a) A trustee shall— Ante, p. 2605. (1) perform the duties of a trustee specified in sections 704(2), 704(4), 704(6), 704(7), and 704(8) of this title; (2) if the debtor has not done so, file the list, schedule, and Ante, p. 2586. statement required under section 521(1) of this title; (3) except to the extent that the court orders otherwise, investigate the acts, conduct, assets, liabilities, and financial condition of the debtor, the operation of the debtor's business and the desirability of the continuance of such business, and any other matter relevant to the case or to the formulation of a plan; (4) as soon as practicable— (A) file a statement of any investigation conducted under paragraph (3) of this subsection, including any fact ascertained pertaining to fraud, dishonesty, incompetence, mis. '-JL * ' conduct, mismanagement, or iregularity in the management ,, of the affairs of the debtor, or to a cause of action available to the estate; and (B) transmit a copy or a summary of any such statement to any creditors' committee or equity security holders' committee, to any indenture trustee, and to such other entity as the court designates; (5) as soon as practicable, file a plan under section 1121 of this title, file a report of why the trustee will not file a plan, or recomAnte, p. 2603. mend conversion of the case to a case under chapter 7 or 13 of this title or dismissal of the case; (6) for any year for which the debtor has not filed a tax return required by law, furnish, without personal liability, such information as may be required by the governmental unit with which such tax return was to be filed, in light of the condition of the debtor's books and records and the availability of such information; and (7) after confirmation of a plan, file such reports as are necessary or as the court orders. (b) An examiner appointed under section 1104(c) of this title shall perform the duties specified in paragraphs (3) and (4) of subsection (a) of this section, and any other duties of the trustee that the court orders the debtor in possession not to perform. 11 USC 1107. § 1107. Rights, powers, and duties of debtor in possession (a) Subject to any limitations on a trustee under this chapter, and to such limitations or conditions as the court prescribes, a debtor in possession shall have all the rights, other than the right to compensa-

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1349

 PUBLIC LAW 95-598—NOV. 6, 1978

92 STAT. 2629

tion under section 330 of this title, and powers, and shall perform all the functions and duties, except the duties specified in sections 1106(a) (2), (3), and (4) of this title, of a trustee serving in a case under this chapter. (b) Notwithstanding section 327(a) of this title, a person is not disqualified for employment under section 327 of this title by a debtor in possession solely because of such person's employment by or representation of the debtor before the commencement of the case. § 1108. Authorization to operate business Unless the court orders otherwise, the trustee may operate the debtor's business. § 1109. Right to be heard (a) The Securities and Exchange Commission may raise and may appear and be heard on any issue in a case under this chapter, but the Securities and Exchange Commission may not appeal from any judgment, order, or decree entered in the case. (b) A party in interest, including the debtor, the trustee, a creditors' committee, an equity security holders' committee, a creditor, an equity security holder, or any indenture trustee, may raise and may appear and be heard on any issue in a case under this chapter. § 1110. Aircraft equipment and vessels (a) The right of a secured party with a purchase-money equipment security interest in, or of a lessor or conditional vendor of, whether as trustee or otherwise, aircraft, aircraft engines, propellers, appliances, or spare parts, as defined in section 101 of the Federal Aviation Act of 1958 (49 U.S.C. 1301), or vessels of the United States, as defined in subsection B (4) of the Ship Mortgage Act, 1920 (46 U.S.C. 911 (4)), that are subject to a purchase-money equipment security interest granted by, leased to, or conditionally sold to, a debtor that is an air carrier operating under a certificate of convenience and necessity issued by the Civil Aeronautics Board, or a water carrier that holds a certificate of public convenience and necessity or permit issued by the Interstate Commerce Commission, as the case may be, to take possession of such equipment in compliance with the provisions of a purchase-money equipment security agreement, lease, or conditional sale contract, as the case may be, is not affected by section 362 or 363 of this title or by any power of the court to enjoin such taking of possession, unless— (1) before 60 days after the date of the order for relief under this chapter, the trustee, subject to the court's approval, agrees to perform all obligations of the debtor that become due on or after such date under such security agreement, lease, or conditional sale contract, as the case may be; and (2) any default, other than a default of a kind specified in section 365(b)(2) of this title, under such security agreement, lease, or conditional sale contract, as the case may be— (A) that occurred before such date is cured before the expiration of such 60-day period; and (B) that occurs after such date is cured before the later of— n) 30 days after the date of such default; and (ii) the expiration of such 60-day period. (b) The trustee and the secured party, lessor, or conditional vendor, as the case may be, whose right to take possession is protected under

Ante, p. 2564.

Ante, p. 2563.

H USC 1108. H USC 1109.

v

11 USC 1110.

Ante, pp. 2570, 2572.

Ante, p. 2574,.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1350

 92 STAT. 2630

11 USC n i l. Ante, p. 2578. Ante, p. 2586. Ante, p. 2579.

Ante, p. 2572.

'

'

''

Ante, p. 2583. 11 USC 1112. Ante, p. 2603.

' Notice and hearing.

PUBLIC LAW 95-598—NOV. 6, 1978

subsection (a) of this section may a^ee, subject to the court's approval, to extend the 60-day period specified in subsection (a)(1) of this section. . § n i l. Claims and interests (a-) A proof of claim or interest is deemed filed under section 501 of this title for any claim or interest that appears in the schedules filed under section 521(1) or 1106(a)(2) of this title, except a claim or interest that is scheduled as disputed, contingent, or unliquidated. (b)(1)(A) A claim secured by a lien on property of the estate shall be allowed or disallowed under section 502 of this title the same as if the holder of such claim had recourse against the debtor on account of such claim, whether or not such holder has such recourse, unless— (i) the class of which such claim is a part elects, by at least two-thirds in amount and more than half in number of allowed claims of such class, application of paragraph (2) of this sub• section; or (ii) such holder does not have such recourse and such property is sold under section 363 of this title or is to be sold under the plan. (B) A class of claims may not elect application of paragraph (2) of this subsection if— (i) the interest on account of such claims of the holders of such claims in such property is of inconsequential value; or (ii) the holder of a claim of such class has recourse against the debtor on account of such claim and such property is sold under section 363 of this title or is to be sold under the plan. (2) If such an election is made, then notwithstanding section 506(a) of this title, such claim is a secured claim to the extent that such claim is allowed. § 1112. Conversion or dismissal (a) The debtor may convert a case under this chapter to a case under chapter 7 of this title unless— (1) the debtor is not a debtor in possession; (2) the case is an involuntary case originally commenced under this chapter; or (3) the case was converted to a case under this chapter on other than the debtor's request. (b) Except as provided in subsection (c) of this section, on request of a party in interest, and after notice and a hearing, the court may convert a case under this chapter to a case under chapter 7 of this title or may dismiss a case under this chapter, whichever is in the best interest of creditors and the estate, for cause, including— (1) continuing loss to or diminution of the estate and absence of a reasonable likelihood of rehabilitation; (2) inability to effectuate a plan; (3) unreasonable delay by the debtor that is prejudicial to creditors; (4) failure to propose a plan under section 1121 of this title within any time fixed by the court; ^' ^ (5) denial of confirmation of every proposed plan and denial of additional time for filing another plan or a modification of a plan; (6) revocation of an order of confirmation under section 1144 of this title, and denial of confirmation of another plan or a modified plan under section 1129 of this title;

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1351

 PUBLIC LAW 95-598—NOV. 6, 1978

92 STAT. 2631

(7) inability to effectuate substantial consummation of a confirmed plan; (8) material default by the debtor with respect to a confirmed plan; and (9) termination of a plan by reason of the occurrence of a condition specified in the plan. (c) The court may not convert a case under this chapter to a case under chapter 7 of this title if the debtor is a farmer or a corpora- Ante, p. 2603. tion that is not a moneyed, business, or commercial corporation, unless the debtor requests such conversion. (d) The court may convert a case under this chapter to a case under chapter 13 of this title only if— (1) the debtor requests such conversion; and (2) the debtor has not been discharged under section 1141(d) of this title. (e) Notwithstanding any other provision of this section, a case may not be converted to a case under another chapter of this title unless the debtor may be a debtor under such chapter. SUBCHAPTER II—THE PLAN § 1121. Who may file a plan (a) The debtor may file a plan with a petition commencing a voluntary case, or at any time in a voluntary case or an involuntary case. (b) Except as otherwise provided in this section, only the debtor may file a plan until after 120 days after the date of the order for relief under this chapter. (c) Any party in interest, including the debtor, the trustee, a creditors' committee, an equity security holders' committee, a creditor, an equity security holder, or any indenture trustee, may file a plan if and only if— (1) a trustee has been appointed under this chapter; (2) the debtor has not filed a plan before 120 days after the date of the order for relief under this chapter; or (3) the debtor has not filed a plan that has been accepted, before 180 days after the date of the order for relief under this chapter, by each class the claims or interests of which are impaired under the plan. (d) On request of a party in interest and after notice and a hearing, the court may for cause reduce or increase the 120-day period or the 180-day period referred to in this section. § 1122. Classification of claims or interests (a) Except as provided in subsection (b) of this section, a plan may place a claim or an interest in a particular class only if such claim or interest is substantially similar to the other claims or interests of such class. (b) A plan may designate a separate class of claims consisting only of every unsecured claim that is less than or reduced to an amount that the court approves as reasonable and necessary for administrative convenience. § 1123. Contents of plan (a) A plan shall— (1) designate, subject to section 1122 of this title, classes of claims other than claims of a kind specified in section 507(a)(1), 507(a)(2), or 507(a)(6) of this title and classes of interests; (2) specify any class of claims or interests that is not impaired under the plan;

11 USC 1121.

11 USC 1122.

11 USC 1123. Ante, p. 2583.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1352

 92 STAT. 2632

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Ante, p. 2574. j.

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PUBLIC LAW 95-598—NOV. 6, 1978 (3) shall specify the treatment of any class of claims or interests that is impaired under the plan; (4) provide the same treatment for each claim or interest of a particular class, unless the holder of a particular claim or interest agrees to a less favorable treatment of such particular claim or interest; (5) provide adequate means for the plan's execution, such as— (A) retention by the debtor of all or any part of the property of the estate; (B) transfer of all or any part of the property of the estate to one or more entities, whether organized before or after the confirmation of such plan; (C) merger or consolidation of the debtor with one or more persons; (D) sale of all or any part of the property of the estate, either subject to or free of any lien, or the distribution of all or any part of the property of the estate among those having an interest in such property of the estate; (E) satisfaction or modification of any lien; (F) cancellation or modification of any indenture or similar instrument; (G) curing or waiving any default; (H) extension of a maturity date or a change in an interest rate or other term of outstanding securities; (I) amendment of the debtor's charter; or (J) issuance of securities of the debtor, or of any entity referred to in subparagraph (B) or (C) of this paragraph, for cash, for property, for existing securities, or in exchange for claims or interests, or for any other appropriate purpose; (6) provide for the inclusion in the charter of the debtor, if the debtor is a corporation, or of any corporation referred to in paragraph (5)(B) or (5)(C) of this subsection, of a provision prohibiting the issuance of nonvoting equity securities, and providing, as to the several classes of securities possessing voting power, an appropriate distribution of such power among such classes, including, in the case of any class of equity securities having a preference over another class of equity securities with respect to dividends, adequate provisions for the election of directors representing such preferred class in the event of default in the payment of such dividends; and (7) contain only provisions that are consistent with the interests of creditors and equity security holders and with public policy with respect to the manner of selection of any officer, director, or trustee under the plan and any successor to such officer, director, or trustee, (b) Subject to subsection (a) of this section, a plan may— (1) impair or leave unimpaired any class of claims, secured or unsecured, or of interests; (2) subject to section 365 of this title, provide for the assumption or rejection of any executory contract or unexpired lease of the debtor not previously rejected under section 365 of this title; (3) provide for— (A) the settlement or adjustment of any claim or interest belonging to the debtor or to the estate; or ^-g^ ^j^g retention and enforcement by the debtor, by the trustee, or by a representative of the estate appointed for such purpose, of any such claim or interest;

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1353

 PUBLIC LAW 95-598—NOV. 6, 1978

92 STAT. 2633

(4) provide for the sale of all or substantially all of the property of the estate, and the distribution of the proceeds of such sale among holders of claims or interests; and (5) include any other appropriate provision not inconsistent with the applicable provisions of this title. (c) In a case concerning an individual, a plan proposed by an entity other than the debtor may not provide for the use, sale, or lease of property exempted under section 5'22 of this title, unless the debtor consents to such use, sale, or lease. § 1124. Impairment of claims or interests Except as provided in section 1123(a)(4) of this title, a class of claims or interests is impaired under a plan unless, with respect to each claim or interest of such class, the plan— (1) leaves unaltered the legal, equitable, and contractual rights to which such claim or interest entitles the holder of such claim or interest; (2) notwithstanding any contractual provision or applicable law that entitles the holder of such claim or interest to demand or receive accelerated payment of such claim or interest after the occurrence of a default— (A) cures any such default, other than a default of a kind specified in section 365(b)(2) of this title, that occurred before or after the commencement of the case under this title; (B) reinstates the maturity of such claim or interest as such maturity existed before such default; (C) compensates the holder of such claim or interest for any damages incurred as a result of any reasonable reliance by such holder on such contractual provision or such applicable law; and (D) does not otherwise alter the legal, equitable, or contractual rights to which such claim or interest entitles the holder of such claim or interest; or (3) provides that, on the effective date of the plan, the holder of such claim or interest receives, on account of such claim or interest, cash equal to— (A) with respect to a claim, the allowed amount of such claim; or (B) with respect to an interest, if applicable, the greater of— (i) any fixed liquidation preference to which the terms of any security representing such interest entitle the holder of such interest; and (ii) any fixed price at which the debtor, under the terms of such security, may redeem such security from such holder. 1125. Postpetition disclosure and solicitation (a) In this section— (1) "adequate information" means information of a kind, and in sufficient detail, as far as is reasonably practicable in light of the nature and history of the debtor and the condition of the debtor's books and records, that would enable a hypothetical reasonable investor typical of holders of claims or interests of the relevant class to make an informed judgment about the plan; and (2) "investor typical of holders of claims or interests of the relevant class" means investor having—

Ante, p. 2586. 11 USC 1124.

Ante, p. 2574.

'

11 USC 1125. "Adequate information.

"Investor typical of holders of claims or interests of the relevant class."

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1354

 92 STAT. 2634

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11 USC 1126. Ante, p. 2579.

PUBLIC LAW 95-598—NOV. 6, 1978 (A) a claim or interest of the relevant class; (B) such a relationship with debtor as the holders of other claims or interests of such class generally have; and (C) such ability to obtain such information from sources other than the disclosure required by this section as holders claims or interests in such class generally have. (b) An acceptance or rejection of a plan may not be solicited after the commencement of the case under this title from a holder of a claim or interest with respect to such claim or interest, unless, at the time of or before such solicitation, there is transmitted to such holder the plan or a summary of the plan, and a written disclosure statement approved, after notice and a hearing, by the court as containing adequate information. The court may approve a disclosure statement without a valuation of the debtor or an appraisal of the debtor's assets. (c) The same disclosure statement shall be transmitted to each holder of a claim or interest of a particular class, but there may be transmitted different disclosure statements, differing in amount, detail, or kind of information, as between classes. (d) Whether a disclosure statement contains adequate information is not governed by any otherwise applicable nonbankruptcy law, rule, or regulation, but an agency or official whose duty is to administer or enforce such a law, rule, or regulation may be heard on the issue of whether a disclosure statement contains adequate information. Such an agency or official may not appeal from an order approving a disclosure statement. (e) A person that solicits, in good faith and in compliance with the applicable provisions of this title, or that participates, in good faith and in compliance with the applicable provisions of this title, in the offer, issuance, sale, or purchase of a security, offered or sold under the plan, of the debtor, of an affiliate participating in a joint plan with the debtor, or of a newly organized successor to the debtor under the plan, is not liable, on account of such solicitation or participation, for violation of any applicable law, rule, or regulation governing the offer, issuance, sale, or purchase of securities. § 1126. Acceptance of plan (a) The holder of a claim or interest allowed under section 502 of this title may accept or reject a plan. If the United States is a creditor or equity security holder, the Secretary of the Treasury may accept or reject the plan on behalf of the United States. (b) For the purposes of subsections (c) and (d) of this section, a holder of a claim or interest that has accepted or rejected the plan before the commencement of the case under this title is deemed to have accepted or rejected such plan, as the case may be, if— (1) the solicitation of such acceptance or rejection was in compliance with any applicable nonbankruptcy law, rule, or regulation governing the adequacy of disclosure in connection with such solicitation; or (2) if there is not any such law, rule, or regulation, such acceptance or rejection was solicited after disclosure to such holder of adequate information, as defined in section 1125(a)(1) of this title. (c) A class of claims has accepted a plan if such plan has been accepted by creditors, other than any entity designated under subsection (e) of this section, that hold at least two-thirds in amount and more than one-half in number of the allowed claims of such class held by creditors, other than any entity designated under subsection (e) of this section, that have accepted or rejected such plan.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1355

 PUBLIC LAW 95-598—NOV. 6, 1978 (d) A class of interests has accepted a plan if such plan has been accepted by holders of such interests other than any entity designated under subsection (e) of this section, that hold at least two-thirds in amount of the allowed interests of such class held by holders of such interests, other than any entity designated under subsection (e) of this section, that have accepted or rejected such plan. (e) On request of a party in interest, and after notice and a hearing. the court may designate any entity whose acceptance or rejection of such plan was not in good faith, or was not solicited or procured in good laith or in accordance with the provisions of this title. (f) Notwithstanding any other provision of this section, a class that is not impaired under a plan is deemed to have accepted the plan, and solicititation of acceptances with respect to such class from the holders of claims or interest of such class is not required. (g) Notwithstanding any other provision of this section, a class is deemed not to have accepted a plan if such plan provides that the claims or interests of such class do not entitle the holders of such claims or interests to any payment or compensation under the plan on account of such claims or interests. § 1127. Modification of plan (a) The proponent of a plan may modify such plan at any time before confirmation, but may not modify such plan so that such plan as modified fails to meet the requirements of sections 1122 and 1123 of this title. After the proponent files a modification with the court, the plan as modified becomes the plan. (b) The proponent of a plan or the reorganized debtor may modify such plan at any time after confirmation of such plan and before substantial consummation of such plan, but may not modify such plan so that such plan as modified fails to meet the requirements of sections 1122 and 1123 of this title. Such plan as modified under this subsection becomes the plan only if the court, after notice and a hearing, confirms such plan, as modified, under section 1129 of this title, and circumstances warrant such modification. (c) The proponent of a modification shall comply with section 1125 of this title with respect to the plan as modified. (d) Any holder of a claim or interest that has accepted or rejected a plan is deemed to have accepted or rejected, as the case may be, such plan as modified, unless, within the time fixed by the court, such holder changes such holder's previous acceptance or rejection. § 1128. Confirmation hearing (a) After notice, the court shall hold a hearing on confirmation of a plan. (b) A party in interest may object to confirmation of a plan. § 1129. Confirmation of plan (a) The court shall confirm a plan only if all of the following requirements are met: (1) The plan complies with the applicable provisions of this chapter. • (2) The proponent of the plan complies with the applicable provisions of this chapter. (3) The plan has been proposed in good faith and not by any means forbidden by law. (4)(A) Any payment made or promised by the proponent, by the debtor, or by a person issuing securities or acquiring property

92 STAT. 2635

Notice and hearing,

H USC 1127.

H USC 1128.

11 USC 1129.

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1356

 92 STAT. 2636

,

y.

Ante, p. 2603.

.

Ante, p. 2583.

PUBLIC LAW 95-598—NOV. 6, 1978 under the plan, for services or for costs and expenses in, or in connection with, the case, or in connection with the plan and incident to the case, has been disclosed to the court; and (B)(i) any such payment made before confirmation of the plan is reasonable; or (ii) if such payment is to be fixed after confirmation of the plan, such payment is subject to the approval of the court as reasonable. (5)(A)(i) The proponent of the plan has disclosed the identity and affiliations of any individual proposed to serve, after confirmation of the plan, as a director, officer, or voting trustee of the debtor, an affiliate of the debtor participating in a joint plan with the debtor, or a successor to the debtor under the plan; and (ii) the appointment to, or continuance in, such office of such individual, is consistent with the interests of creditors and equity security holders and with public policy. (B) The proponent of the plan has disclosed the identity of any insider that will be employed or retained by the reorganized debtor, and the nature of any compensation for such insider. (6) Any regulatory commission with jurisdiction, after confirmation of the plan, over the rates of the debtor has approved any rate change provided for in the plan, or such rate change is expressly conditioned on such approval. (7) With respect to each class— (A) each holder of a claim or interest of such class— (i) has accepted the plan; or (ii) will receive or retain under the plan on account of such claim or interest property of a value, as of the effective date of the plan, that is not less than the amount that such holder would so receive or retain if the debtor were liquidated under chapter 7 of this title on such date; or (B) if section 1111(b)(2) of this title applies to the claims of such class, each holder of a claim of such class vnll receive or retain under the plan on account of such claim property of a value, as of the effective date of the plan, that is not less than the value of such creditor's interest in the estate's interest in the property that secures such claims. C8) With respect to each class— (A) such class has accepted the plan; or (B) such class is not impaired under the plan. (9) Except to the extent that the holder of a particular claim has agreed to a different treatment of such claim, the plan provides that— (A) with respect to a claim of a kind specified in section 507(a)(1) or 507(a)(2) of this title, on the effective date of the plan, the holder of such claim will receive on account of such claim cash equal to the allowed amount of such claim; (B) with respect to a class of claims of a kind specified in section 507(a)(3), 507(a)(4), or 507(a)(5) of this title, each holder of a claim of such class will receive— (i) if such class has accepted the plan, deferred cash payments of a value, as of the effective date of the plan, equal to the allowed amount of such claim; or (ii) if such class has not accepted the plan, cash on the effective date of the plan equal to the allowed amount of such claim; and (C) with respect to a claim of a kind specified in section 507(a)(6) of this title, the holder of such claim will receive

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Page:United States Statutes at Large Volume 92 Part 2.djvu/1357

 PUBLIC LAW 95-598—NOV. 6, 1978

92 STAT. 2637

on account of such claim deferred cash payments, over a period not exceeding six years after the date of assessment of such claim, of a value, as of the effective date of the plan, equal to the allowed amount of such claim. (10) At least one class of claims has accepted the plan, determined without including any acceptance of the plan by any insider holding a claim of such class. (11) Confirmation of the plan is not likely to be followed by the liquidation, or the need for further financial reorganization, of the debtor or any successor to the debtor under the plan, unless such liquidation or reorganization is proposed in the plan. (b)(1) Notwithstanding section 510(a) of this title, if all of Ante, p. 2586. the applicable requirements of subsection (a) of this section other than paragraph (8) are met with respect to a plan, the court, on request of the proponent of the plan, shall confirm the plan notwithstanding the requirements of such paragraph if the plan does not discriminate unfairly, and is fair and equitable, with respect to each class of claims or interests that is impaired under, and has not accepted, the plan. (2) For the purpose of this subsection, the condition that a plan be fair and equitable with respect to a class includes the following requirements: (A) With respect to a class of secured claims, the plan provides— (i)(I) that the holders of such claims retain the lien securing such claims, whether the property subject to such lien is retained by the debtor or transferred to another entity, to the extent of the allowed amount of such claims; and (II) that each holder of a claim of such class receive on account of such claim deferred cash payments totaling at least the allowed amount of such claim, of a value, as of the effective date of the plan, of at least the value of such holder's interest in the estate's interest in such property; (ii) for the sale, subject to section 363(k) of this title, of Ante, p. 2572. any property that is subject to the lien securing such claims, free and clear of such lien, with such lien to attach to the proceeds of such sale, and the treatment of such lien on proceeds under clause (i) or (iii) of this subparagraph; or (iii) for the realization by such holders of the indubitable equivalent of such claims. (B) With respect to a class of unsecured claims— (i) the plan provides that each holder of a claim of such class receive or retain on account of such claim property of a value, as of the effective date of the plan, equal to the allowed amount of such claim; or '-• * r (ii) the holder of any claim or interest that is junior to the claims of such class will not receive or retain on account of such junior claim or interest any property. (C) With respect to a class of interests— (i) the plan provides that each holder of an interest of such class receive or retain on account of such claim property of a value, as of the effective date of the plan, equal to the greatest of the allowed amount of any fixed liquidation preference to which such holder is entitled, any fixed redemption price to which such holder is entitled, and the value of such interest; or (ii) the holder of any interest that is junior to the interests of such class will not receive or retain under the plan on account of such junior interest any property.

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Page:Folk-lore - A Quarterly Review. Volume 10, 1899.djvu/253

 Rh off his guard; and he did not attempt to strike the intruder at the first approach, but waited for him to come nearer. This was what Benign-face wanted, and, stretching out his forepaws as if in play, he seized his opportunity, and cut the rattle-snake in pieces with his stone claws. When the people saw that the intruder had killed all their dogs, they hastened to fetch their weapons to kill him. But Benign-face rushed at them, and slashed and cut them with his sharp two-bladed tail so swiftly that in a short time not a man, woman, or child of them remained alive. He now resumed his own form, and restored all the animals to life again, but took from them their dog-nature, giving them the natures proper to their kind, and bade them go live in the woods. He next restored the people to life, but, after he had reproached them for their wickedness, transformed them all into ants. The two brothers now joined him, having thrown aside their eaglet-skins; and from this place they travelled down to Harrison Lake. Here they heard of a man who caused windstorms to arise at his wish, so that those who were on the lake were never sure of getting back safe again. He did this to upset their boats, in order that his cannibal brother. Seal-man, might have their bodies for his dinner. Seeking this man out. Benign-face said to him: "I am told you are a very great man, and have 'medicine' to make the wind rise when you wish to. Is the report true?" The shaman, not knowing who his questioner was, and proud of his powers, declared it was quite true. When asked what use he put his powers to, he boldly confessed that he used them to upset and drown people on the lake, that his brother might have their bodies. This made Benign-face very angry, and, calling Seal-man to him, he deprived him of his arms and legs, giving him flippers in their stead, and commanded him to eat no more human flesh, but to feed thereafter on fish. Thus it is that the seal has flippers, and feeds on fish. But the shaman he punished by transforming him into a smooth-faced rock, whereon men might paint; which rock may be seen on the shore of the lake, according to Mischelle, with its painted figures upon it, to this day.

Ascending the Fraser once more, they came to the region of the Lillooet. On Bridge River Benign-face found the people very poor and miserable. They did not know how to catch the salmon which passed up the river. So Benign-face stretched his leg


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Page:United States Statutes at Large Volume 92 Part 2.djvu/1358

 92 STAT. 2638

'•-'^-^••-

11 USC 1141.

Ante, p. 2579. Ante, p. 2578.

Ante, p. 2590.

Ante, p. 2609. Waiver.

PUBLIC LAW 95-598~NOV. 6, 1978 (c) Notwithstanding subsections (a) and (b) of this section and except as provided in section 1127(b) of this title, the court may confirm only one plan, unless the order of confirmation in the case has been revoked under section 1144 of this title. If the requirements of subsections (a) and (b) of this section are met with respect to more than one plan, the court shall consider the preferences of creditors and equity security holders in determining which plan to confirm. (d) Notwithstanding any other provision of this section, on request of a party in interest that is a governmental unit, the court may not confirm a plan if the principal purpose of the plan is the avoidance of taxes or the avoidance of section 5 of the Securities Act of 1933 (15 U.S.C.77e). SUBCHAPTER III—POSTCONFIRMATION MATTERS § 1141. ElTect of confirmation (a) Except as provided in subsections (d)(2) and (d)(3) of this section, the provisions of a confirmed plan bind the debtor, any entity issuing securities under the plan, any entity acquiring property under the plan, and any creditor or equity security holder of, or general partner in, the debtor, whether or not the claim or interest of such creditor, equity security holder, or general partner is impaired under the plan and whether or not such creditor, equity security holder, or general partner has accepted the plan. (b) Except as otherwise provided in the plan or the order confirming the plan, the confirmation of a plan vests all of the property of the estate in the debtor. (c) After confirmation of a plan, the property dealt with by the plan is free and clear of all claims and interests of creditors, of equity security holders, and of general partners in the debtor, except as otherwise provided in the plan or in the order confirming the plan. (d)(1) Except as otherwise provided in this subsection, in the plan, or in the order confirming the plan, the confirmation of a plan— (A) discharges the debtor from any debt that arose before the date of such confirmation, and any debt of a kind specified in section 502(g), 502(h), or 502 (i) of this title, whether or not— (i) a proof of the claim based on such debt is filed or deemed filed under section 501 of this title; (ii) such claim is allowed under section 502 of this title; or (iii) the holder of such claim has accepted the plan; and (B) terminates all rights and interests of equity security holders and general partners provided for by the plan. (2) The confirmation of a plan does not discharge an individual debtor from any debt excepted from discharge under section 523 of this title. (3) The confirmation of a plan does not discharge a debtor if— (A) the plan provides for the liquidation of all or substantially all of the property of the estate; (B) the debtor does not engage in business after consummation of the plan; and (C) the debtor would be denied a discharge under section 727(a) of this title if the case were a case under chapter 7 of this title. (4) The court may approve a written waiver of discharge executed by the debtor after the order for relief under this chapter.

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