Motion to Assume Restructuring Support Agreement

Summary

This template motion is for use by a Chapter 11 debtor in possession filing a prearranged or pre-negotiated bankruptcy. This template includes practical guidance, drafting notes, and alternate and optional clauses. A restructuring support agreement is sometimes also referred to as a plan support agreement or lockup agreement. Such agreements can be used between a debtor and its key creditors and generally provide that the creditors will support and not vote against a proposed restructuring. In turn, the debtor agrees to formulate a plan on agreed-upon terms within an agreed-upon time frame, typically with certain interim milestones. The parties to the restructuring support agreement generally agree to specific obligations regarding the restructuring process. Certain obligations relate only to the company, which typically prosecutes the plan, while other such obligations relate only to the creditor as the stakeholders and voting parties in the restructuring. Parties have sought to have the debtor assume the plan support agreement pursuant to Section 365 of the Bankruptcy Code at the start of or early in the Chapter 11 cases. This ensures that creditors can seek to compel the debtor to perform under the plan support agreement because the plan support agreement is a pre-petition executory contract, which the debtor could reject. For more information on restructuring/plan support agreements, see Plan Support Agreements and Assessing a Workout. For related templates, see Restructuring Support Agreement (NY), Restructuring, Lockup, Plan Support and Forbearance Agreement, and Joinder to Restructuring Support Agreement. For general information on assumption and assignment, see Assumption, Assignment, and Rejection of Executory Contracts. For a general assumption template, see Motion to Assume and Assign Executory Contracts or Unexpired Leases.