Approval and Confirmation of a Company’s Rehabilitation in Georgia

Creditor classes are groups of creditors with comparable legal positions and economic interests. Their appropriate classification determines how claims are treated under the rehabilitation plan and how votes are counted. The reasons for each classification should therefore be clearly set out in the plan documents. Before the vote, the eligible creditors, the relevant claim amounts, and the majorities required for each group must be determined. The creditors then vote on the rehabilitation plan according to the rules applicable to their claim groups. The result must show which votes were counted and whether the required majorities were achieved. However, a successful creditor vote does not by itself make the plan binding. The competent court also examines whether the plan was adopted in accordance with the applicable procedural rules and can be confirmed. Errors in classifying groups, determining voting rights, or documenting the process can jeopardize confirmation of the plan. A complete voting record therefore brings together the list of creditors, their class assignments, claim values, votes cast, calculation of the result, and the court’s decision.