Resolution Bazaar

Preparation of a resolution plan is a critical step in the Corporate Insolvency Resolution Process (CIRP). A resolution plan outlines the strategy for reviving the financially distressed corporate debtor while maximizing value for creditors and other stakeholders. The plan must comply with the mandatory requirements of Section 30(2) of the IBC, ensuring that operational creditors are paid at least the liquidation value and that it does not contravene any provisions of the law. Resolution applicants, who can be individuals or entities meeting eligibility criteria under Section 29A, submit their plans to the resolution professional (RP). The RP evaluates the plans for compliance and feasibility, taking into account factors like repayment schedules, restructuring proposals, and operational turnaround strategies. Approved plans are then presented to the Committee of Creditors (CoC), which votes on the proposals based on a 66% majority threshold. Once approved by the CoC, the resolution plan is submitted to the Adjudicating Authority (NCLT) for final approval. The plan’s successful implementation is monitored to ensure adherence to its terms, marking the resolution of the insolvency process and enabling the corporate debtor's revival.

Plan Preparation and Plan Evaluation Agents are integral tools in the insolvency resolution process, offering both efficiency and accuracy in creating and assessing resolution plans. Plan Preparation Agents assist resolution applicants by guiding them through the drafting of resolution plans that are legally compliant with the provisions outlined in Section 30(2) of the Insolvency and Bankruptcy Code (IBC) 2016. These agents ensure that the plans address all mandatory requirements, such as ensuring operational creditors receive at least the liquidation value and ensuring the plan does not contravene any legal stipulations.

• The agents leverage data analytics, AI, and predictive modelling to design strategies that include asset restructuring, debt repayment schedules, and operational turnaround proposals, enhancing the likelihood of a successful resolution. On the other hand, Plan Evaluation Agents play a critical role in objectively assessing and comparing the resolution plans submitted by resolution applicants. These agents evaluate the financial feasibility of each plan, focusing on the recovery rates for creditors, estimated asset values, and the distribution of proceeds among different classes of creditors. They also track the projected timelines for plan execution, considering potential delays, regulatory hurdles, and complexities associated with asset sales and debt restructuring. In addition, the agents ensure that each plan complies with the legal framework governing insolvency processes, cross-referencing them against relevant provisions of the IBC or applicable legislation in other jurisdictions.
• Moreover, these agents assess the feasibility of proposed restructuring steps by considering both quantitative aspects, such as financial projections, and qualitative factors, like the likelihood of stakeholder support and the overall potential for long-term success. They also evaluate the impact of the plan on various stakeholders, ensuring that the resolution is balanced and minimizes losses for creditors, employees, and the debtor. Plan Evaluation Agents use AI-driven predictive and prescriptive models to simulate potential outcomes of each resolution plan, estimating recovery values, timelines, and risks. These agents generate a comparative scoring and ranking system, allowing insolvency professionals to make transparent, data-driven decisions. The combination of Plan Preparation and Plan Evaluation Agents ensures that the resolution process is efficient, compliant, and optimized, helping insolvency professionals identify the most viable and equitable plan for all parties involved.