On behalf of Trenton Grand of Grand Law Firm on Thursday, September 27, 2018.

Although bankruptcy is a disheartening word in the world of business, many multi-national corporations use a Chapter 11 bankruptcy to avoid the demise of their business standings. Chapter 11 bankruptcies, commonly described as "restructures" or "reorganizations", allow businesses to continue to operate while creating a plan for repaying creditors.

Chapter 11 bankruptcy works to help businesses determine their assets, their debts, and those they owe to work toward paying back their heavy outstanding amounts. In cases of bankruptcy, whether your corporation owes extensive cash or your individual family lies heavily in debt to creditors, you may wish to hire an experienced bankruptcy attorney. He or she understands the crucial elements needed for filing bankruptcy and can offer advice on how to restructure your business to repay creditors. Bankruptcy may not indicate the closing of your dream and the end to your profession - it may simply mean a reorganization.

Filing a Chapter 11 bankruptcy as a debtor

According to the United States Courts, Chapter 11 bankruptcy can either begin with creditors filing or debtors filing. You may wish to file a voluntary petition as a debtor, or an involuntary petition could require you to follow specific steps.

Along with the petition, you may be required to file:

  • Assets and liabilities schedules
  • Current incomes and expenses
  • Contracts and active leases
  • A financial affairs statement

You will include your identifying information, as well as the following important documents:

  1. Your plan for reorganization and repayment; or
  2. Your intent to file a plan for reorganization and repayment; and
  3. Your request for relief under Chapter 11 bankruptcy

Debtor in possession and staying in business

Filing Chapter 11 bankruptcy as a voluntary petitioner allows you to become the "debtor in possession". During your restructure and initiation of your plan for repayment, you will still maintain control of your business.

In addition, because you file to reorganize, you can begin to repay your owed funds by downsizing, liquidating or by another means. Doing so, you may not need to halt your overall business operations, and you can continue to run your business, produce your products or engage in your services while you go through chapter 11 bankruptcy filings.

The process of filing bankruptcy may prove confusing and exhausting. To properly engage in bankruptcy relief proceedings for your business, you may wish to seek the experience of a bankruptcy attorney. Bankruptcy attorneys understand the various qualifications that make you or your business eligible for filing and can give you an accurate analysis of your situation. Waiting to file may simply increase your debts, so you may wish to begin creating a voluntary petition for Chapter 11 bankruptcy quickly.