--- title: Chapter 11 Plan Must Contain More Than Promises, Promises description: Learn about what chapter 11 bankruptcy plans must contain. The blog explains your rights in a complicated bankruptcy process and how Goosmann Law can help. image: https://blog.goosmannlaw.com/hubfs/bankruptcy%20subchater%20V-2.jpg --- [![Goosman Lawfirm](https://blog.goosmannlaw.com/hs-fs/hubfs/Goosmannlaw%20October2017/images/Goosmann_Law_Firm_logo_4C-white.png?width=1250&name=Goosmann_Law_Firm_logo_4C-white.png "Goosman Lawfirm")](http://goosmannlaw.com/) - [COVID-19 Toolbox](https://goosmannlaw.com/covid-19-resource-toolbox/) - Our Team - [Attorneys](https://goosmannlaw.com/attorneys/) - [Non-Attorney Staff](https://http://goosmannlaw.com/non-attorney-staff/) - Practices & Industries - [Practices](https://goosmannlaw.com/practices/) - [Banking & Finance](https://goosmannlaw.com/banking-finance/) - [Bankruptcy, Restructuring & Workouts](https://goosmannlaw.com/bankruptcy-restructuring-workouts/) - [Business](https://goosmannlaw.com/business/) - [Divorce & Family Law](https://goosmannlaw.com/divorce-family-law/) - [Employment](https://goosmannlaw.com/employment-law/) - 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Lally](https://blog.goosmannlaw.com/banking-lawyer-on-you-side/author/elizabeth-m-lally)   |  29, January 2021 [READ NOW](https://blog.goosmannlaw.com/banking-lawyer-on-you-side/chapter-11-plan-must-contain-more-than-promises-promises) [Read Post](https://blog.goosmannlaw.com/banking-lawyer-on-you-side/chapter-11-plan-must-contain-more-than-promises-promises#article) [![](https://blog.goosmannlaw.com/hs-fs/hubfs/Elizabeth%20M%20Lally%20Headshot_Close-2.jpg?width=60&name=Elizabeth%20M%20Lally%20Headshot_Close-2.jpg)](https://blog.goosmannlaw.com/banking-lawyer-on-you-side/author/elizabeth-m-lally) [Elizabeth M. Lally](https://blog.goosmannlaw.com/banking-lawyer-on-you-side/author/elizabeth-m-lally)  Tags: [Chapter 11 Bankruptcy](https://blog.goosmannlaw.com/banking-lawyer-on-you-side/topic/chapter-11-bankruptcy) When a creditor receives a proposed Chapter 11 plan of reorganization in the mail promising the debtor will pay the creditor 100% over time it can be tempting to vote quickly in favor. However, it is important to remember that the plan must be based more on than a hope and a prayer. A mere promise to pay creditors in full is not enough for a plan to be confirmed. Rather, for a plan to be confirmed it must provide “adequate means for the plan’s implementation” pursuant to Section 1123(a)(5) of the Bankruptcy Code.   So, what, exactly, is “adequate information”? In short, a debtor must show creditors and the court the money based on information and projects that are more than pie-in-the-sky. The plan proponent must “show concrete evidence of a sufficient cash flow to fund and maintain both its operations and obligations under the plan.”[\[1\]](https://blog.goosmannlaw.com/banking-lawyer-on-you-side/chapter-11-plan-must-contain-more-than-promises-promises#_ftn1) Where will creditors receive their payments from—the reorganized debtor’s ongoing operations, asset sales, future refinancing, or a combination of these things? Income projections must not be “speculative, conjectural or unrealistic.”[\[2\]](https://blog.goosmannlaw.com/banking-lawyer-on-you-side/chapter-11-plan-must-contain-more-than-promises-promises#_ftn2) Solid financial projects based on recognized past performance as well as future performance goals that are reasonably obtainable are key to this requirement. Also important are up-to-date and legitimate valuations of assets if the sale of assets is to support plan payments or security for future refinancing. Further, “runways” provided for by hoped for future refinancing and/or massive balloon payments at the end of a plan are not, in and of themselves, adequate to support a plan. Also, a plan should contain firm milestones for commencing or completing a sale or refinancing should the plan payments fail or if such events are envisioned as part of supporting the plan over time. If you need help understanding your rights in the complicated bankruptcy process, contact the experienced bankruptcy attorneys at Goosmann Law in our Sioux City, Sioux Falls, and Omaha offices. [![Contact Us](https://no-cache.hubspot.com/cta/default/489404/a0a6fbc4-dfb1-4601-91d9-472d71800e64.png)](https://cta-redirect.hubspot.com/cta/redirect/489404/a0a6fbc4-dfb1-4601-91d9-472d71800e64) [\[1\]](https://blog.goosmannlaw.com/banking-lawyer-on-you-side/chapter-11-plan-must-contain-more-than-promises-promises#_ftnref1) *S**&P, Inc. v. Pfeifer*, 189 B.R. 173, 183 (N. D. Ind. 1995). [\[2\]](https://blog.goosmannlaw.com/banking-lawyer-on-you-side/chapter-11-plan-must-contain-more-than-promises-promises#_ftnref2) *M&S Associates*, 138 B.R. 845, 848-849 (Bankr. W.D. 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