Exclusivity Period [Bankruptcy] Law and Legal Definition
Exclusivity period refers to the exclusive right of a debtor filing a chapter 11 reorganization bankruptcy to file a plan of reorganization for 120 days after the bankruptcy petition has been filed. During the exclusivity period, parties who wish to file competing plans must convince the court to terminate the debtor's exclusivity period. The exclusivity period can be extended by the court.
The following is an example of a case law on exclusivity period:
The exclusivity period affords the debtor an opportunity to negotiate the settlement of its debts by proposing and soliciting support for its plan of reorganization without interference in the form of competing plans from its creditors or others in interest. Two competing interests are balanced through this. One, the interest of the debtor in the survival of its business, and other the interest of the creditors in avoiding undue delay in the satisfaction of the debtor's obligations. [Geriatrics Nursing Home v. First Fidelity Bank, N.A. (In re Geriatrics Nursing Home), 187 B.R. 128, 131-132 (D.N.J. 1995)].