1104—Appointment of a trustee. If creditors don’t think that the DIP is doing a good job, they may request that a trustee be appointed.
1. 1104(a)—court may appoint trustee on request of a party any time after commencement of case and before confirmation of the plan. Appointment made for cause—examples of cause given under (a)(1), if it is in the best interest of the creditors of the estate. (Typically, court is reluctant to do this, and will only do so if there is clear and convincing evidence for need.)
2. 1104(b)—election of trustee if appointment desired by court.
3. 1104(c)—appointment of an examiner. If a trustee is not appointed, then on request of interested party and after notice and a hearing, the court shall appoint an examiner to conduct an investigation of the DIP’s conduct if (1) such an appointment is in the interest of creditors or (2) the debt is over 5 mil. (This is more common and could be a step on the way to the appointment of a trustee b/c the examiner may find misconduct.)
4. Turnaround management—professionals who turn companies around. Not appealing to current management who will be thrown out.
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