§ 122 — Procedure of reorganization and expenses in connection therewith

§ 122. Procedure of reorganization and expenses in connection\ntherewith. The reorganization plan may be presented to the court with\nthe complaint for foreclosure, or thereafter by the trustee or by any\npersons owning or representing twenty-five per centum of the principal\namount of the securities covered by such mortgage, deed of trust or\nindenture at any time prior to the foreclosure sale. The plan shall\ncontain a statement of the minimum and maximum sums which the trustee\nshall bid for the property, which sums may be varied by the court upon\nits approval of the plan; and the trustee shall not incur any liability\nby reason of its failure to bid more than said maximum sum. The trustee\nshall not be liable for any action in executing the plan of\nreorganization approved by the court except for its wilful misconduct,\nfraud, bad faith or gross negligence. Hearings upon such reorganization\nplan shall be at such time and place and upon such notice by\npublication, mailing or otherwise, as the court shall fix in an order to\nshow cause why the plan should not be approved. The trustee and any\nperson beneficially interested in said mortgage, deed of trust or\nindenture, and any person whose rights may be affected by such\nreorganization, may appear upon the return day of the order to show\ncause or at any adjournment thereof, and submit objections to and\nmodifications of the plan or an alternate plan, and the court shall hear\nthe parties by affidavit or summarily or otherwise, as in its discretion\nit may direct, and thereupon finally determine the plan of\nreorganization and fix the time and method for persons affected by such\nreorganization to become parties thereto. Where neither the mortgage or\nindenture, nor the statute relating to the particular class of\nsecurities nor any other statute, authorizes the purchase of the\nproperty on behalf of all the holders of bonds or certificates of parts\nor shares, then if any holder, within twenty days after the approval of\nthe plan, shall file with the court a duly acknowledged dissent\ntherefrom, the court shall determine the cash value of the property as\nif sold at a public sale and such dissenting holder shall be entitled to\nbe secured for his ratable share of such amount as a condition for\ndeclaring the plan effective. In all other cases the reorganization plan\nshall be deemed binding on all holders of bonds or certificates of\nshares or parts unless within twenty days after the approval of the plan\none-third in principal sum of such holders shall file with the court\nduly acknowledged dissents therefrom; in which event the plan may be\nabandoned or may be further modified as the court shall direct, with the\nsame right of dissent as aforesaid as to any subsequently amended plan.\nNotice of the court's approval of the plan shall be given by\npublication, mailing or otherwise as the court may in particular cases\nor by general rule direct. Any person aggrieved by any determination\nhereunder shall have such rights of appeal as are granted to a party to\na special proceeding. The expenses and compensation of the trustee and\nof any committee or person who shall have submitted a plan of\nreorganization or modifications thereof shall be fixed at such sum as\nthe court may deem reasonable and shall be chargeable as a lien upon the\nproperty or collectible through their assumption by the new corporation\nor in such other manner as the court may approve. All proceedings and\nappeals in respect to the plan of reorganization shall be entitled to\npreference over all other civil causes next in order to actions or\nspecial proceedings in which the people of the state or any officer,\nboard or political subdivision thereof shall be a party.\n