Composition with Creditors -- Debtor to Carry on Business under Inspection by Creditors' Committee -- Transfer to Committee of Real Estate of Debtor

• Category: Contracts - Composition with Creditors
• State: Multi-State
• Control #: US-0935BG
• Format: Word; Rich Text

Description

A composition agreement is an agreement made between an embarrassed or insolvent debtor and two or more of his creditors that each of the creditors entering into the agreement will be paid a specified amount, less than the whole of their claims, and the creditors agree to accept such payment in full satisfaction of their claims. The agreement works substantially an accord for which the consideration is the satisfaction to be made by the debtor, and such an accord is no bar to suit on the original debt, unless the satisfaction is performed.

Composition with Creditors -- Debtor to Carry on Business under Inspection by Creditors' Committee -- Transfer to Committee of Real Estate of Debtor is a type of agreement between a creditor and a debtor that allows the debtor to continue to operate their business while being monitored by a creditors' committee and transferring real estate to the committee. This type of agreement enables creditors to secure payment from the debtor's assets and for the debtor to continue to operate their business without going into bankruptcy. Types of Composition with Creditors include a deed of arrangement, a deed of assignment, and a deed of surrender. All of these agreements involve a repayment plan and allow creditors to take control of some of the debtor's assets in order to secure payment.