Series 50: Exercise

Exercise

Answer true or false

1. 1. True or false. An acceleration provision allows the municipality to speed up bankruptcy proceedings.
2. 2. True or false. All distressed securities are considered to be in default, but not all defaulted securities are considered to be distressed.
3. 3. True or false. A writ of mandamus orders the municipality to raise taxes or take other steps in order to make GO bond payments.
4. 4. True or false. A letter of credit is no longer valid after a municipality files for Chapter 9.
5. 5. True or false. A municipality may undo collective bargaining agreements as a way of saving money during a Chapter 9 proceeding.
6. 6. True or false. The bankruptcy court cannot limit the amount of debt a municipality may acquire during a Chapter 9 proceeding.

Choose the best answer

1. 7. Snowy Falls has just filed a bankruptcy petition under Chapter 9. Which of the following is not a basis on which an objection to Snowy Falls’ petition may be made?
2. A. Snowy Falls did not negotiate its bankruptcy plan in good faith.
3. B. Snowy Falls is not authorized by the state to file for Chapter 9.
4. C. Snowy Falls did not file its bankruptcy plan in good faith.
5. D. Snowy Falls’ debt is listed as disputed or contingent.
6. 8. The notice of bankruptcy for Snowy Falls has been published in a local paper and a statewide paper. For how many successive weeks must the notice appear?
7. A. Two
8. B. Three
9. C. Four
10. D. Five
11. 9. John, the trustee, creates a creditors’ committee to represent Snowy Falls’ largest creditors. Which of the following may this committee not do?
12. A. Cause Snowy Falls to liquidate enough of its assets to make its debt payments
13. B.