Bankruptcy can be a difficult and complex process. Businesses, Corporations, Sole Proprietorships and other organizations are permitted to file a Chapter 11 Bankruptcy under the United State Bankruptcy Code.
When a business is unable to pay off its debts to its creditors it is faced with the question of either filing for a Chapter 11 or a Chapter 7 bankruptcy.
A Chapter 11 bankruptcy allows an organization who is unable to pay back it debts to reorganize itself, thereby establishing a more viable entity which will be able to repay its back its debtors. A Chapter 11 bankruptcy may be a favorable option for many corporations which have witnessed a recent spate of reduced revenues and increasing debts.
Since the economic recession of 2007 to present, courts across the nation have seen a substantial increase in the number of chapter 11 bankruptcies in their dockets. If your corporation is facing an increasing debts that are unlikely to be paid off based on the current business structure, it is advised that you seek consultation with a Los Angeles Chapter 11 bankruptcy attorney.
Downtown LA Laws Chapter 11 bankruptcy attorneys provide all corporate clients with a free consultation regarding their financial situation; and proved a strategic based analysis of the different options that are available. Our corporate clients are provided with a strategic road map outlining the chapter 11 filing process and other alternatives which may be available.
What doe as Chapter 11 Bankruptcy entail. What are my rights and my duties during the Chapter 11 reorganization?
Under a chapter 11 bankruptcy, shareholders represented by the corporate board remain in control of the business, subject to oversight by the presiding bankruptcy court. Below are some of the main features of a Chapter 11 bankruptcy.
Benefit of Chapter 11
- The Chapter 11 process begins with a filling of a petition to the bankruptcy court in a proper jurisdiction. A Chapter 11 filing may be voluntarily submitted by the corporation or involuntarily submitted by the corporation’s creditors.
- The filing corporation must file a certificate of credit counseling as well as a copy of a debt repayment plan along with a presentation of the corporation’s revenue, cost structure.
: The benefit of a Chapter 11 is that under this plan a trustee overseeing corporate entity and ensuring the repayment of debts is appointed by the corporate debtor. Thus the debtor is in effect continues to act as the deciding force in the business, thou his power to make decision is under the supervision of the agreed upon plan provided to the presiding bankruptcy court. Below are some of the rights that are afforded to the corporate debtor in a Chapter 11 filing.
Chapter 11 Plan:
- The Mechanism to restructure his/her business
- Rights to seek out and accept and assume new debt via financing options, loans and other financial instruments.
- Automatic stay against further litigation for unpaid debts
A debtor has a 120 period which it has the sole and exclusive right to file a plan. If in the even the plan is not provided and or not accepted and the time has ran out, the creditors are afforded that right. The plan is a reorganization of the business so that it will be able to pay off its assets. The time period of the plan may range from case to case. It is important that a bankruptcy attorney skilled and knowledgeable in Chapter 11 filings be consulted before a plan is presented to the court.
Once the judge approves the place and creditors have accepted is terms the plan enter the confirmation phase. This process may be highly complex if there are multiple class of creditors; thus, often skilled negotiators are an important factor in receiving a confirmation that is most advantageous to the filing party.
Why Choose Chapter 11 Bankruptcy law firm Downtown LA Law Group?
At Downtown La Law our bankruptcy lawyers will provide you with a low cost, personal, and confidential bankruptcy legal representation. Here are some of the reasons why…
We understand that filing for Bankruptcy because of difficult financial state can be a difficult and onerous process. Your success is our success. Please Call (855) 339-8879
- A Free and Personalized consultation with our skilled Chapter 11 Lawyers and financial consultants will include an analysis your corporation’s financial circumstances.
- Individualized Client Service specifically tailored to your financial and personal needs
- Comprehensive assessment of the different legal avenues determining whether chapter 11 bankruptcy is the best option for your needs.
- Skilled negotiators whose goals will be to maximize the advantageous dimensions of the Chapter 11 plan and minimize its detrimental effects.
- Low Cost, Knowledgeable and Effective representation of your Chapter 11 bankruptcy process.