Chapter 11 Reorganization
A chapter 11 bankruptcy is technically considered a reorganization for a business, although it can also be used to assist a company in selling or winding down its operations. Essentially, a chapter 11 bankruptcy allows a company to continue to operate in its ordinary course of business but with the benefit of the “automatic stay” in place - a mechanism that can only be achieved in a bankruptcy case. The “automatic stay” is a court-imposed bar which prevents your creditors (your lender, suppliers, landlord, labor union, taxing authorities, etc.) from continuing their efforts to collect monies due. This bar can remain in place, in most cases, until together we are able to propose a plan of reorganization. Often times, some “breathing room” from your creditors is just what your company needs to regroup, rebuild and restructure, leaving you with a stronger, more solvent company with increased cash flow and a brighter future.
We have an exceptionally skilled team with a proven track record of successfully guiding businesses, large and small, through the bankruptcy process. Just a few of the benefits of a chapter 11 can include:
- Substantially discounting trade debt by as much as 90%
- Restructuring and repaying obligations over a longer term in a way that makes sense for your business’s cash flow
- Selling the business or assets free and clear of the claims or liens of its creditors
- Terminating burdensome contracts or premises, equipment or other types of leases
- Achieving payment terms with your taxing authorities over a five (5) year period and substantially discounting penalties
Stopping collection efforts for as long as ten (10) months, and sometimes longer
- Avoiding impending foreclosures, labor strikes, repossessions, restraints and seizures.