Complete Home & Office Legal Guide/Complete Home and Office Legal Guide (Chestnut) (1993).ISO/stat/fed/11usc11b.asc

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/* We continue with Chapter 11, part two. */

SECTION 1129 (11 U.S.C.  1129)

1129.  Confirmation of plan.

(a)  The court shall confirm a plan only if all of the following
requirements are met:

     (1)  The plan complies with the applicable provisions of
this title.

     (2)  The proponent of the plan complies with the applicable
provisions of this title.

     (3)  The plan has been proposed in good faith and not by any
means forbidden by law.

     (4)  Any payment made or to be made by the proponent, by the
debtor, or by a person issuing securities or acquiring property
under the plan, for services or for costs and expenses in or in
connection with the case, or in connection with the plan and
incident to the case, has been approved by, or is subject to the
approval of, the court as reasonable;

     (5)(A)(i) The proponent of the plan has disclosed the
identity and affiliations of any individual proposed to serve,
after confirmation of the plan, as a director, officer, or voting
trustee of the debtor, an affiliate of the debtor participating
in a joint plan with the debtor, or a successor to the debtor
under the plan; and

     (ii) the appointment to, or continuance in, such office of
such individual, is consistent with the interests of creditors
and equity security holders and with public policy; and

     (B)  the proponent of the plan has disclosed the identity of
any insider that will be employed or retained by the reorganized
debtor, and the nature of any compensation for such insider.

/* These requirements relate ot the disclosure statement. It is a
strange idea to place these requirements here, rather than in the
disclosure statement provisions. */

     (6)  Any governmental regulatory commission with
jurisdiction, after confirmation of the plan, over the rates of
the debtor has approved any rate change provided for in the plan,
or such rate change is expressly conditioned on such approval

     (7)  With respect to each impaired class of claims or
interests --

     (A)  each holder of a claim or interest of such class-


     (i)  has accepted the plan; or

/* If the class (and each secured creditor usually is its own
class) does not accept the plan provisions, the following
requirements must be met. This is the famous "cram down" in which
the terms of the plan are crammed down the throats of the
creditors despite their objections. */

     (ii) will receive or retain under the plan on account of
such claim or interest property of a value, as of the effective
date of the plan, that is not less than the amount that such
holder would so receive or retain if the debtor were liquidated
under chapter 7 of this title on such date; or

     (B)  if section 1111(b)(2) of this title applies to the
claims of such class, each holder of a claim of such class will
receive or retain under the plan on account of such claim
property of a value, as of the effective date of the plan, that
is not less than the value of such holder's interest in the
estate's interest in the property that secures such claims.

/* The mindnumbing provisions of 1111(b)(2) provide for a secured
non-recourse creditor to accept altered treatment of their
rights. */

     (8)  With respect to each class of claims or interests --

     (A)  such class has accepted the plan; or

     (B)  such class is not impaired under the plan.

/* A class is not impaired under several circumstances include
de-acceleration of a defaulted installment obligation. */

     (9)  Except to the extent that the holder of a particular
claim has agreed to a different treatment of such claim, the plan
provides that-

     (A)  with respect to a claim of a kind specified in section
507(a)(1) or 507(a)(2) of this title, on the effective date of
the plan, the holder of such claim will receive on account of
such claim cash equal to the allowed amount of such claim;

     (B)  with respect to a class of claims of a kind specified
in section 507(a)(3), 507(a)(4), 507(a)(5) or 507(a)(6) of this
title, each holder of a claim of such class will receive--

     (i)  if such class has accepted the plan, deferred cash
payments of a value, as of the effective date of the plan, equal
to the allowed amount of such claim; or

     (ii) if such class has not accepted the plan, cash on the
effective date of the plan equal to the allowed amount of such
claim; and

     (C)  with respect to a claim of a kind specified in section
507(a)(7) of this title, the holder of such claim will receive on
account of such claim deferred cash payments, over a period not
exceeding six years after the date of assessment of such claim,
of a value, as of the effective date of the plan, equal to the
allowed amount of such claim.

     (10) If a class of claims is impaired under the plan, at
least one class of claims that is impaired under the plan has
accepted the plan, determined without including any acceptance of
the plan by an insider.

     (11) Confirmation of the plan is not likely to be followed
by the liquidation, or the need for further financial
reorganization, of the debtor or any successor to the debtor
under the plan, unless such liquidation or reorganization is
proposed in the plan.

     (12) All fees payable under section 1930, as determined by
the court at the hearing on confirmation of the plan, have been
paid or the plan provides for the payment of all such fees on the
effective date of the plan.

     (13) The plan provides for the continuation after its
effective date of payment of all retiree benefits, as that term
is defined in section 1114 of this title, at the level
established pursuant to subsection (e)(1)(B) or (g) of section
1114 of this title, at any time prior to confirmation of the
plan, for the duration of the period the debtor has obligated
itself to provide such benefits.

(b)(1) Notwithstanding section 510(a) of this title, if all of
the applicable requirements of subsection (1) of this section
other than paragraph (8) are met with respect to a plan, the
court on request of the proponent of the plan, shall confirm the
plan notwithstanding the requirements of such paragraph if the
plan does not discriminate unfairly, and is fair and equitable,
with respect to each class of claims or interest that is impaired
under, and has not accepted, the plan.

     (2) For the purpose of this subsection, the condition that a
plan be fair and equitable with respect to a class includes the
following requirements:

         (A) With respect to a class of secured claims, the plan
provides--

             (i)(I) that the holders of such claims retain the
liens securing said claims, whether the property subject to such
liens is retained by the debtor or transferred to another entity,
to the extent of the allowed amount of such claims; and

             (II) the each holder of a claim of such class
receive on account of such claim deferred cash payments totaling
at least the allowed amount of such claim, of a value, as of the
effective date of the plan, of at least the value of such
holder's interest in the estate's interest in such property;

             (ii) for the sale, subject to section 363(k) of this
title, of any property that is subject to the liens securing such
claims, free and clear of such liens, with such liens to attach
to the proceeds of such sale, and the treatment of such liens on
proceeds under clause 9i) or (iii) of this subparagraph; or

             (iii) for the realization by such holders of the
indubitable equivalent of such claims.

     (B) With respect to a class of unsecured claims--

             (i) the plan provides that each holder of a claim of
such class receive or retain on account of such claim property of
a value, as of the effective date of the plan, equal to the
allowed amount of such claim; or

     (ii) the holder of any claim or interest that is junior to
the claims of such class will not receive or retain under the
plan on account of such junior claim or interest any property.

     (C)  With respect to a class of interests --

     (i)  the plan provides that each holder of an interest of
such class receive or retain on account of such interest property
of a value, as of the effective date of the plan, equal to the
greatest of the allowed amount of any fixed liquidation
preference to which such holder is entitled, any fixed redemption
price to which such holder is entitled, or the value of such
interest; or

     (ii) the holder of any interest that is junior to the
interests of such class will not receive or retain under the plan
on account of such junior interest any property.

     (c)  Notwithstanding subsections (a) and (b) of this section
and except as provided in section 1127(b) of this title, the
court may confirm only one plan, unless the order of confirmation
in the case has been revoked under section 1144 of this title. If
the requirements of subsections (a) and (b) of this section are
met with respect to more than one plan, the court shall consider
the preferences of creditors and equity security holders in
determining which plan to confirm.

     (d)  Notwithstanding any other provision of this section, on
request of a party in interest that is a governmental unit, the
court may not confirm a plan if the principal purpose of the plan
is the avoidance of taxes or the avoidance of the application of
section 5 of the Securities Act of 1933 (15 U.S.C. 77e). In any
hearing under this subsection, the governmental unit has the
burden of proof on the issue of avoidance.

SUBCHAPTER III

Postconfirmation Matters.

Section 1141. Effect of confirmation.

   (a) Except as provided in subsections 9d)(2) and (d)(3) of
this section, the provisions of a confirmed plan bind the debtor,
any entity issuing securities under the plan, any entity
acquiring property under the plan, and any creditor, equity
security holder, or general partner in [sic] the debtor, whether
or  not the claim or interest of such creditor, equity security
holder, or general partner is impaired under the plan and whether
or not such creditor, equity security holder, or general partner
has accepted the plan.

   (b) Except as otherwise provided in the plan or the order
confirming the plan, the confirmation of a plan vests all of the
property of the estate in the debtor.

   (c) Except as provided in subsections (d)(2) and (d)(3) of
this section and except as otherwise provided in the plan or in
the order confirming the plan, after confirmation of a plan, the
property dealt with by the plan is free and clear of all claims
and interests of creditors, equity security holders, and of
general partners in the debtor.

   (d)(1) Except as otherwise provided in this subsection, in the
plan, or in the order confirming the plan, the confirmation of a
plan--

      (A) discharges the debtor from any debt that arose before
the date of such confirmation, and any debt of a kind specified
in section 502(g), 502(h) or 502(i) of this title, whether or
not--

         (i) a proof of the claim based on such debt is filed or
deemed filed under section 501 of this title;

         (ii) such claim is allowed under section 502 of this
title; or

         (iii) the holder of such claims has accepted the plan;
and

     (B) terminates all rights and interest of equity security
holders and general partners provided for by the plan.

   (2) The confirmation of a plan does not discharge an
individual debtor from any debt excepted from discharge under
section 523 of this title.

   (3) The confirmation of a plan does not discharge a debtor
if--

     (A) the plan provides for the liquidation of all or
substantially all of the property of the estate;

     (B) the debtor does not engage in business after
consummation of the plan; and

     (C) the debtor would be denied a discharge under section
727(a) of this title if the case were a case under chapter 7 of
this title.

   (4)  The court may approve a written waiver of discharge
executed by the debtor after the order for relief under this
chapter.

SECTION 1142 (11 U.S.C.  1142)

1142.  Implementation of plan.

     (a)  Notwithstanding any otherwise applicable nonbankruptcy
law, rule, or regulation relating to financial condition, the
debtor and any entity organized or to be organized for the
purpose of carrying out the plan shall carry out the plan and
shall comply with any orders of the court.

     (b)  The court may direct the debtor and any other necessary
party to execute or deliver or to join in the execution or
delivery of any instrument required to effect a transfer of
property dealt with by a confirmed plan, and to perform any other
act, including the satisfaction of any lien, that is necessary
for the consummation of the plan.

/* A redundant provision given the all writs power of 11 USC 109.
*/

SECTION 1143 (11 U.S.C.  1143)

1143.  Distribution. If a plan requires presentment or surrender
of a security or the performance of any other act as a condition
to participation in distribution under the plan, such action
shall be taken not later than five years after the date of the
entry of the order of confirmation. Any entity that has not
within such time presented or surrendered such entity's security
or taken any such other action that the plan requires may not
participate in distribution under the plan.

SECTION 1144 (11 U.S.C.  1144)

1144.  Revocation of an order of confirmation. On request of a
party in interest at any time before 180 days after the date of
the entry of the order of confirmation, and after notice and a
hearing, the court may revoke such order if and only if such
order was procured by fraud. An order under this section revoking
an order of confirmation shall-

     (1)  contain such provisions as are necessary to protect any
entity acquiring rights in good faith reliance on the order of
confirmation; and

     (2)  revoke the discharge of the debtor.

/* Strangely enough the redundancy department adds in a section
requiring that if the court revoke the discharge that it revoke
the discharge. */

SECTION 1145 (11 U.S.C.  1145)

1145.  Exemption from securities laws.

(a)  Except with respect to an entity that is an underwriter as
defined in subsection (b) of this section, section 5 of the
Securities Act of 1933 (15 U.S.C. 77e) and any State or local law
requiring registration for offer or sale of a security or
registration or licensing of an issuer of, underwriter of, or
broker or dealer in, a security does not apply to-

     (1)  the offer or sale under a plan of a security of the
debtor, of an affiliate participating in a joint plan with the
debtor, or of a successor to the debtor under the plan-

     (A)  in exchange for a claim against, an interest in, or a
claim for an administrative expense in the case concerning, the
debtor or such affiliate; or

     (B)  principally in such exchange and partly for cash or
property;

     (2)  the offer of a security through any warrant, option,
right to subscribe, or conversion privilege that was sold in the
manner specified in paragraph (1)  of this subsection, or the
sale of a security upon the exercise of such a warrant, option,
right, or privilege;

     (3)  the offer or sale, other than under a plan, of a
security of an issuer other than the debtor or an affiliate, if-

     (A)  such security was owned by the debtor on the date of
the filing of the petition;

     (B)  the issuer of such security is-

     (i)  required to file reports under section 13 or 15(d) of
the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d));
and

     (ii) in compliance with the disclosure and reporting
provision of such applicable section; and

     (C)  such offer or sale is of securities that do not exceed-

     (i)  during the two-year period immediately following the
date of the filing of the petition, four percent of the
securities of such class outstanding on such date; and

     (ii) during any l80-day period following such two-year
period, one percent of the securities outstanding at the
beginning of such 180-day period; or

     (4)  a transaction by a stockbroker in a security that is
executed after a transaction of a kind specified in paragraph (1)
or (2) of this subsection in such security and before the
expiration of 40 days after the first date on which such security
was bona fide offered to the public by the issuer or by or
through an underwriter, if such stockbroker provides, at the time
of or before such transaction by such stockbroker, a disclosure
statement approved under section 1125 of this title, and, if the
court orders, information supplementing such disclosure
statement.

     (b)(1) Except as provided in paragraph (2) of this
subsection and except with respect to ordinary trading
transactions of an entity that is not an issuer, an entity is an
underwriter under section 2(11) of the Securities Act of 1933 (15
U.S.C. 77b(11)), if such entity --

     (A)  purchases a claim against, interest in, or claim for an
administrative expense in the case concerning, the debtor, if
such purchase is with a view to distribution of any security
received or to be received in exchange for such a claim or
interest;

     (13) offers to sell securities offered or sold under the
plan for the holders of such securities;

     (C)  offers to buy securities offered or sold under the plan
from the holders of such securities, if such offer to buy is-

     (i)  with a view to distribution of such securities; and

     (ii) under an agreement made in connection with the plan,
with the consummation of the plan, or with the offer or sale of
securities under the plan; or

     (D)  is an issuer, as used in such section 2(11),
with respect to such securities.

     (2)  An entity is not an underwriter under section 2(11) of
the Securities Act of 1933 or under paragraph (1) of this
subsection with respect to an agreement that provides only for-

     (A)(i) the matching or combining of fractional interests in
securities offered or sold under the plan into whole interests;
or

     (ii) the purchase or sale of such fractional interests from
or to entities receiving such fractional interests under the
plan; or

     (B)  the purchase or sale for such entities of such
fractional or whole interests as are necessary, to adjust for any
remaining fractional interests after such matching.

     (3)  An entity other than an entity of the kind specified in
paragraph (1) of this subsection is not an underwriter under
section 2(11) of the Securities Act of 1933 with respect to any
securities offered or sold to such entity in the manner specified
in subsection (a)(1) of this section.

     (c)  An offer or sale of securities of the kind and in the
manner specified under subsection (a)(1) of this section is
deemed to be a public offering.

     (d)  The Trust Indenture Act of 1939 (15 U.S.C. 77aaa et
seq.) does not apply to a note issued under the plan that matures
not later than one year after the effective date of the plan.

SECTION 1146 (11 U.S.C.  1146)

1146.  Special tax provisions.

(a)  For the purpose of any State or local law imposing a tax on
or measured by income, the taxable period of a debtor that is an
individual shall terminate on the date of the order for relief
under this chapter, unless the case was converted under section
706 of this title.

     (b) The trustee shall make a State or local tax return of
income for the estate of an individual debtor in a case under
this chapter for each taxable period after the order for relief
under this chapter during which the case is pending.

     (c)  The issuance, transfer, or exchange of a security, or
the making or delivery of an instrument of transfer under a plan
confirmed under section 1129 of this title, may not be taxed
under any law imposing a stamp tax or similar tax.

     (d)  The court may authorize the proponent of a plan to
request a determination, limited to questions of law, by a State
or local governmental unit charged with responsibility for
collection or determination of a tax on or measured by income, of
the tax effects, under section 346 of this title and under the
law imposing such tax, of the plan. In the event of an actual
controversy, the court may declare such effects after the earlier
of-

     (1)  the date on which such governmental unit responds to
the request under this subsection; or

     (2)  270 days after such request.

SUBCHAPTER IV

Railroad Reorganization

SECTION 1161 (11 U.S.C.  1161)

     1161.  Inapplicability of other sections. Sections 341, 343,
1102(a)(1), 1104, 1105,1107, 1129(a)(7), and 1129(c) of this
title do not apply in a case concerning a railroad.

SECTION 1162 (11 U.S.C.  1162)

1162.  Definition. In this subchapter, "Commission" means
Interstate Commerce Commission.

SECTION 1163 (11 U.S.C.  1163)

1163.  Appointment of trustee. As soon as practicable after the
order for relief the Secretary of Transportation shall submit a
list of five disinterested persons that are qualified and willing
to serve as trustees in the case. The United States trustee shall
appoint one of such persons to serve as trustee in the case.

/* The management of the railroad gets the ax upon filing. */

SECTION 1164 (11 U.S.C.  1164)

1164.  Right to be heard. The Commission, the Department of
Transportation, and any State or local commission having
regulatory jurisdiction over the debtor may raise and may appear
and be heard on any issue in a case under this chapter, but may
not appeal from any judgment, order, or decree entered in the
case.

SECTION 1165 (11 U.S.C.  1165)

1165.  Protection of the public interest. In applying sections
1166, 1167, 1169, 1170, 1171, 1172, 1173, and 1174 of this title,
the court and the trustee shall consider the public interest in
addition to the interests of the debtor, creditors, and equity
security holders.

SECTION 1166 (11 U.S.C.  1166)

1166.  Effect of Interstate Commerce Act and of Federal, State,
or local regulations. Except with respect to abandonment under
section 1170 of this title, or merger, modification of the
financial structure of the debtor, or issuance or sale of
securities under a plan, the trustee and the debtor are subject
to the provisions of subtitle IV of title 49 that are applicable
to railroads, and the trustee is subject to orders of any
Federal, State, or local regulatory body to the same extent as
the debtor would be if a petition commencing the case under this
chapter had not been filed, but-

     (1)  any such order that would require the expenditure, or
the incurring of an obligation for the expenditure, of money from
the estate is not effective unless approved by the court; and

     (2)  the provisions of this chapter are subject to section
601(b) of the Regional Rail Reorganization Act of1973 (45 U.S.C.
791(b)).

SECTION 1167 (11 U.S.C.  1167)

     1167.  Collective bargaining agreements. Notwithstanding
section 365 of this title, neither the court nor the trustee may
change the wages or working conditions of employees of the debtor
established by a collective bargaining agreement that is subject
to the Railway Labor Act except in accordance with section 6 of
such Act (45 U.S.C. 156).


SECTION 1168 (11 U.S.C.  1168)

1168.  Rolling stock equipment.

     (a)  The right of a secured party with a purchase money
equipment security interest in, or of a lessor or conditional
vendor of, whether as trustee or otherwise, rolling stock
equipment or accessories used on such equipment, including
superstructure and racks, that are subject to a purchase - money
equipment security interest granted by, leased to, or
conditionally sold to, the debtor to take possession of such
equipment in compliance with the provisions of a purchase - money
equipment security agreement, lease, or conditional sale
contract, as the case may be, is not affected by section 362 or
363 of this title or by any power of the court to enjoin such
taking of possession, unless-

     (1)  before 60 days after the date of the commencement of a
case under this chapter, the trustee, subject to the court's
approval, agrees to perform all obligations of the debtor under
such security agreement, lease, or conditional sale contract, as
the case may be; and

     (2)  any default, other than a default of a kind specified
in section 365(b)(2) of this title, under such security
agreement, lease, or conditional sale contract, as the case may
be-

     (A)  that occurred before such date and is an event of
default therewith is cured before the expiration of such 60-day
period; and

     (B) that occurs or becomes an event of default after such
date is cured before the later of-

     (i)  30 days after the date of such default or event of
default; and

     (ii) the expiration of such 60-day period.

     (b)  The trustee and the secured party, lessor, or
conditional vendor, as the case may be, whose right to take
possession is protected under subsection (a) of this section, may
agree, subject to the court's approval, to extend the 60-day
period specified in subsection (a)(1) of this section.

SECTION 1169 (11 U.S.C.  1169)

1169.  Effect of rejection of lease of railroad line.

    (a)  Except as provided in subsection (b) of this section, if
a lease of a line of railroad under which the debtor is the
lessee is rejected under section 365 of this title, and if the
trustee, within such time as the court fixes, and with the
court's approval, elects not to operate the leased line, the
lessor under such lease, after such approval, shall operate the
line.

    (b)  If operation of such line by such lessor is
impracticable or contrary to the public interest, the court, on
request of such lessor, and after notice and a hearing, shall
order the trustee to continue operation of such line for the
account of such lessor until abandonment is ordered under section
1170 of this title, or until such operation is otherwise lawfully
terminated, whichever occurs first.

     (c)  During any such operation, such lessor is deemed a
carrier subject to the provisions of subtitle IV of title 49 that
are applicable to railroads.

SECTION 1170 (11 U.S.C.  1170)

1170.  Abandonment of railroad line.

     (a)  The court, after notice and a hearing, may authorize
the abandonment of all or a portion of a railroad line if such
abandonment is-

     (1)(A) in the best interest of the estate; or

     (B)  essential to the formulation of a plan; and

     (2)  consistent with the public interest.

     (b)  If, except for the pendency of the case under this
chapter, such abandonment would require approval by the
Commission under a law of the United States, the trustee shall
initiate an appropriate application for such abandonment with the
Commission. The court may fix a time within which the Commission
shall report to the court on such application.

     (c)  After the court receives the report of the Commission,
or the expiration of the time fixed under subsection (b) of this
section, whichever occurs first, the court may authorize such
abandonment, after notice to the Commission, the Secretary' of
Transportation, the trustee, any party in interest that has
requested notice, any affected shipper or community, and any
other entity prescribed by the court, and a hearing.

     (d)(1) Enforcement of an order authorizing such abandonment
shall be stayed until the time for taking an appeal has expired,
or, if an appeal is timely taken, until such order has become
final.

     (2)  If an order authorizing such abandonment is appealed,
the court, on request of a party in interest, may authorize
suspension of service on a line or a portion of a line pending
the determination of such appeal, after notice to the Commission,
the Secretary of Transportation, the trustee, any party in
interest that has requested notice, any affected shipper or
community, and any other entity prescribed by the court, and a
hearing. An appellant may not obtain a stay of the enforcement of
an order authorizing such suspension by the giving of a
supersedeas bond or otherwise, during the pendency of such
appeal.

     (e)(1) In authorizing any abandonment of a railroad line
under this section, the court shall require the rail carrier to
provide a fair arrangement at least as protective of the
interests of employees as that established under section 11347 of
title 49.

     (2)  Nothing in this subsection shall be deemed to affect
the priorities or timing of payment of employee protection which
might have existed in the absence of this subsection.

SECTION 1171(11 U.S.C.  1171)

1171.  Priority claims.

     (a)  There shall be paid as an administrative expense any
claim of an individual or of the personal representative of a
deceased individual against the debtor or the estate, for
personal injury to or death of such individual arising out of the
operation of the debtor or the estate, whether such claim arose
before or after the commencement of the case.

     (b)  Any unsecured claim against the debtor that would have
been entitled to priority if a receiver in equity of the property
of the debtor had been appointed by a Federal court on the date
of the order for relief under this title shall be entitled to the
same priority in the case under this chapter.

SECTION 1172 (11 U.S.C.  1172)

1172.  Contents of plan.

     (a)  In addition to the provisions required or permitted
under section 1123 of this title, a plan-

     (1)  shall specify the extent to and the means by which the
debtor's rail service is proposed to be continued, and the extent
to which any of the debtor's rail service is proposed to be
terminated; and

     (2)  may include a provision for-

     (A)  the transfer of any or all of the operating railroad
lines of the debtor to another operating railroad; or

     (B)  abandonment of any railroad line in accordance with
section 1170 of this title.

     (b)  If, except for the pendency of the case under this
chapter, transfer of, or operation of or over, any of the
debtor's rail lines by an entity other than the debtor or a
successor to the debtor under the plan would require approval by
the Commission under a law of the United States, then a plan may
not propose such a transfer or such operation unless the
proponent of the plan initiates an appropriate application for
such a transfer or such operation with the Commission and, within
such time as the court may fix, not exceeding 180 days, the
Commission, with or without a hearing, as the Commission may
determine, and with or without modification or condition,
approves such application, or does not act on such application.
Any action or order of the Commission approving, modifying,
conditioning, or disapproving such application is subject to
review by the court only under sections 706(2) (A), 706(2)(13),
706(2)(C), and 706(2)(D) of title 5.

     (c)(1) In approving an application under subsection (b) of
this section, the Commission shall require the rail carrier to
provide a fair arrangement at least as protective of the
interests of employees as that established under section 11347 of
title 49.

     (2)  Nothing in this subsection shall be deemed to affect
the priorities or timing of payment of employee protection which
might have existed in the absence of this subsection.

SECTION 1173 (11 U.S.C.  1173)

1173.  Confirmation of plan.

     (a)  The court shall confirm a plan if-

     (1)  the applicable requirements of section 1129 of this
title have been met;

     (2)  each creditor or equity security holder will receive or
retain under the plan property of a value, as of the effective
date of the plan, that is not less than the value of property
that each such creditor or equity security holder would so
receive or retain if all of the operating railroad lines of the
debtor were sold, and the proceeds of such sale, and the other
property of the estate, were distributed under chapter 7 of this
title on such date;

     (3)  in light of the debtor's past earnings and the probable
prospective earnings of the reorganized debtor, there will be
adequate coverage by such prospective earnings of any fixed
charges, such as interest on debt, amortization of funded debt,
and rent for leased railroads, provided for by the plan; and

     (4)  the plan is consistent with the public interest.

     (b)  If the requirements of subsection (a) of this section
are met with respect to more than one plan, the court shall
confirm the plan that is most likely to maintain adequate rail
service in the public interest.


SECTION 1174 (11 U.S.C. 1174)

1174.  Liquidation. On request of a party in interest and after
notice and a hearing, the court may, or, if a plan has not been
confirmed under section 1173 of this title before five years
after the date of the order for relief, the court shall order the
trustee to cease the debtor's operation and to collect and reduce
to money all of the property of the estate in the same manner as
if the case were a case under chapter 7 of this title.