Indubitable Equivalent (Financial Restructuring & Bankruptcy Glossary)

Summary

In determining whether a proposed chapter 11 plan is fair and equitable with respect to a non-accepting secured class, section 1129(b)(2)(A)(iii) of the Bankruptcy Code provides that the plan must provide the secured creditor with the “indubitable equivalent” of its secured claim. Generally, a plan proponent may provide the indubitable equivalent by abandoning the collateral to the secured creditor or by providing a lien on similar, substitute collateral.