Chapter 11 Bankruptcy Attorneys
Chapter 11 Business Bankruptcy Attorneys in Birmingham, Alabama advising businesses about their bankruptcy options in Tuscaloosa, Anniston, Decatur, and throughout Alabama
Chapter 11 is commonly referred to as “reorganization” because it permits reorganization under the bankruptcy laws of the United States. It is available to both individuals and businesses, but is more commonly used by businesses. For individuals, Chapter 11 is somewhat similar to a Chapter 13. The bankruptcy petition may be voluntary, or it may be involuntary and filed by creditors that meet certain requirements. In Chapter 11, unless a trustee is appointed, the debtor remains in control of its business operations and becomes what is called the “debtor-in-possession,” and is subject to the oversight of the court. Creditors can request that a trustee be appointed, who plays a major role in monitoring the progress of a Chapter 11 case. The debtor remains a debtor in possession until the reorganization plan is confirmed, the case is converted to Chapter 7, or a trustee is appointed.
Chapter 11 usually results in the reorganization of the debtor’s business or personal assets, but can also result in liquidation, which means all assets and liabilities are disposed of and the business is dissolved. However, debtors can also emerge from a Chapter 11 bankruptcy within a few years through the use of a plan. Usually, the debtor in possession or trustee creates a Chapter 11 plan, which the creditors then vote on. Once the creditors have approved the plan and the judge has confirmed it, the debtor must operate its business or pay off its debts in accordance with that plan. If a plan cannot be approved by the creditors, the court may either convert the case to a Chapter 7 bankruptcy, or dismiss the case. If the case is dismissed, creditors will look to methods outside of bankruptcy law to satisfy their claims. The reorganization and court process of a Chapter 11 may take a long time, limiting the chances of a successful outcome.
However, the chances of success are increased with an experienced Chapter 11 bankruptcy attorney. Contact the Birmingham legal team of Parkman White, LLP today at 205-502-2000 to see if our attorneys can help your business reorganize its debts.