Ad Hoc Committee Disclosure Requirements A Bitter Pill to Swallow for Distressed Investors
Mondaq Business Briefing › United States Law Articles in English (2007)
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Ad Hoc Committee Disclosure Requirements A Bitter Pill to Swallow for Distressed Investors
An essential part of the chapter 11 process is constructive dialogue and negotiation among all stakeholders involved in the bankruptcy case with a view toward building a consensus on the terms of a confirmable chapter 11 plan. The Bankruptcy Code establishes a framework to promote such interaction by providing for the appointment of official committees of creditors and shareholders entrusted by statute with the duty to participate in the formulation of a chapter 11 plan.
Collective stakeholder participation in a chapter 11 case, however, extends beyond membership on committees officially sanctioned by the Bankruptcy Code. Unofficial, or "ad hoc" committees, have also long played prominent roles in bankruptcy cases. Like official committees of unsecured creditors, shareholders, retirees or other creditor groups, ad hoc committees commonly retain professionals and participate in a chapter 11 case by filing pleadings, appearing...See the full content of this document
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