A reorganization of debts whereby the creditor committee decides that replacing the operating management is the only feasible way to maintain the firm,is called

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This scenario is an example of creditor control, where the creditor committee takes control and makes decisions regarding the management of the firm in order to ensure its survival. A composition refers to a formal agreement between the debtor and the creditor to settle debts for less than the full amount owed. An extension refers to a postponement of payment deadlines. Neither of these options apply to the given scenario.

A Reorganization of Debts Whereby the Creditor Committee Decides That