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And what about those liquidating 11 cases in which the debtor's assets are sold in a series of sale transactions to multiple buyers?
In our experience, not once has an asset buyer in a sale-based liquidating chapter 11 plan negotiated for the payment of these funds five years after the date of the confirmation order.
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As the number of liquidating chapter 11 cases increase across the country, meaningful amounts of funds may remain undistributed notwithstanding the best efforts and compliance with the terms of the confirmed plan by liquidating plan administrators and trustees of trusts formed under liquidating plans.
The funds remained in the court registry until the court determined disposition).
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Additionally, in one instance, a court ordered that a substantial amount of undistributed funds held in its court registry from a reorganization were subject to forfeiture to the federal government.
If the disposition of undistributed funds is not addressed by the plan proponents in the liquidating plan, and notwithstanding that §347(a) does not apply to cases under chapter 11, it seems that in practice undistributed funds in liquidating chapter 11 cases are often disposed of in accordance therewith and Chapter 129, and such funds are frequently deposited into the registry of the court.
District and appellate courts have provided a blueprint for doing so, and recently, a bankruptcy court has done so, too.
§347 Section 347 addresses the treatment of unclaimed funds in all cases under Title 11.