Chapter 11 Bankruptcy Lawyer Helping Tennessee Residents
Chapter 11 is used primarily by businesses (not including sole proprietorships) and/or individuals with substantial debts and assets. Unlike Chapter 7 bankruptcy, which liquidates assets, Chapter 11 allows reorganization while temporarily holding creditors at bay.
Chapter 11 Bankruptcy Explained
If your business can no longer pay its creditors, the business or creditors may file a Chapter 11 bankruptcy petition with a Tennessee court. Under Chapter 11 of the U.S. Bankruptcy Code, a corporation or partnership can seek debt relief during reorganization. Companies often choose to file for Chapter 11 because its long-term revenues will be higher than the liquidation value of the assets. This way, creditors can receive more money if they allow the debtor business to reorganize and work out a repayment plan. A reorganization plan is usually proposed by the Chapter 11 debtor to the court and allows the business to stay afloat while creditors are repaid over time.
The Cost of Chapter 11 Bankruptcy
The cost of Chapter 11 bankruptcy varies based on the circumstances. For a thorough evaluation of your unique situation, call (865) 450-5455 or fill out our contact form to speak with an experienced business bankruptcy attorney and schedule your free initial consultation.
Keeping Your Business Assets
Under Chapter 11, you may continue to run your business while under the supervision of the court. You keep all of your assets and also receive protection against potential lawsuits. It is your responsibility to propose a repayment plan that restructures your financial situation.
The length of time for a Chapter 11 bankruptcy depends upon the terms of the repayment plan. Call (865) 450-5455 to learn more about how this applies to your particular situation.
Operating Your Business
Bankruptcy does not mean that your company must cease operating. In many cases, the business can continue to operate under a Chapter 11 bankruptcy under the oversight of a court-appointed bankruptcy trustee.
Chapter 11 Bankruptcy Trustee
Under Chapter 11, the trustee who is generally the debtor-in-possession operates the business throughout the restructuring process.