Recent Delaware Bankruptcy Rulings Address Whether a Plan of Reorganization Can Deny a 'Make-Whole' Payment Without Impairing Lenders' Claims

Reuters Legal

Ron E. Meisler Jennifer Madden

Members of Skadden's Delaware corporate restructuring team discuss a recent ruling that held that lenders’ claims were unimpaired in a reorganization plan where the debtors agreed to fully satisfy the notes’ original terms, except for a make-whole payment called for in the event of bankruptcy. The decision may have lasting implications for creditor recoveries, debtors’ plans of reorganization and negotiations of debt documents.