David,a debtor,owes debts to creditors Paul,Mark,and Gary.Paul,Mark,and Gary agree with each other and with David to release him from his debts,in exchange for his promise to pay Paul,Mark,and Gary 75 percent of the amount he owes each of them.This is called a composition agreement,and such agreements generally are binding contracts.

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David,Paul,Mark,and Gary are part of a composition agreement,in which a debtor and two or more creditors agree to accept as full payment a stated percentage of their liquidated claims against a debtor at or after the date on which the claims are payable.Such an exchange of promises forms a binding contract.

David,a Debtor,owes Debts to Creditors Paul,Mark,and Gary