Business owners put a lot of hard work and money into their businesses. They come up with the idea for their business then have to find a way to make it happen. They may go to various meetings to try to gain investors in their business or maybe even join forces with a partner or multiple partners. Due to their hard work, business owners never want to see their business fail. If their business fails, they feel like they have failed. This can be disappointing to these owners. They want to find a way to keep their business afloat. They may be able to use the process of Chapter 11 bankruptcy to do so. Chapter 11 bankruptcy may be able to save a business from going out of business. This form of bankruptcy is used for businesses only. Individuals do not use this for their own personal bankruptcy problems.
Through Chapter 11 bankruptcy, businesses can stay open while they are going through the bankruptcy process. This may be able to help them gain a revenue stream. It can help the business owner keep their hopes alive for the business’ future. During this time, employees can continue to work. This is beneficial since all those employees do not have to lose their jobs.
How do I start the process?
To begin the process for Chapter 11 bankruptcy, you will have to file a bankruptcy petition. In this petition, it will include a financial statement, a list of all assets, a list of liabilities and a statement of any outstanding contracts or leases. After this is done and filed, an automatic stay is put into effect. This bars any creditors from contacting you about the debt you owe to them. This can be a good stress reliever since you will not have to face harassment from them any longer.
For the next step, a meeting of creditors will gather. At this meeting, you will attend with your attorney and the creditors you owe the most money to will be able to meet with you. During this meeting, you will present a reorganization plan for your finances. This plan is made with your attorney to continue paying your operation costs for your business while paying off debt at the same time. The plan must be approved by the bankruptcy court to ensure that you are eligible to continue with the process. These payments can be done over a five year period, giving you the time you need to recover financially.
Before taking any sort of legal action, it is important to discuss your legal matter with an experienced attorney. Contact The Radol Law Firm to discuss any divorce and family law matters you may be faced with.