  |
  |
  |
    
  
   |
 | |||
|
|
|
|
| |||
and concluded that a reorganization plan is to be preferred over a liquidating plan, and the
preference of creditors unrelated to the proponent is to be given greater weight than the
preference of creditors related to the proponent. Another court has held that a small
business debtor should have the first opportunity to confirm a plan even after expiration of
its 100 day exclusivity period.
II. SECTION 1129(A) COMPLIANCE
The plan must comply with the applicable provisions of the Bankruptcy Code. § 1129(a)(1). Although the language of this provision encompasses all of Title 11, the legislative history suggests that Congress intended it to refer primarily to provisions governing the form and content of the plan, the most important of which are probably §§ 1122 and 1123, dealing with classification of claims and interests and contents of a plan. Consequently some circuit courts have concluded that "it is doubtful that violations of Code provisions unrelated to the form and content of a plan, such as voting procedures, implicate subsection 1129(a)(l) at all."
Not only must the plan comply with the applicable provisions of Title 11, but the proponent of a plan must also comply. § 1129(a)(2). Legislative history suggests that one primary provision to which this was meant to refer is the requirement of § 1125 that acceptances of a plan not be solicited prior to transmission of an approved disclosure statement. However, a more appropriate remedy for improper solicitation may be to disqualify any votes improperly solicited, because § 1126(e) provides that on request of a party in interest and after notice and hearing, the court may designate any entity whose acceptance or rejection was not solicited in accordance with the provisions of Title 11, and an acceptance or rejection of an entity so designated is not counted under § 1126(c). One court held that the "exclusive" remedy under the Code for an improper solicitation is to disregard the vote under § 1126(c).
