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Chapter 11

Bankruptcy Attorney

A Chapter 11 bankruptcy is normally used for reorganizing a corporation or partnership. A Chapter 11 bankruptcy attorney proposes a plan of reorganization to the bankruptcy judge in order to keep the business alive while paying creditors over time. In the case of a corporation, a chapter eleven bankruptcy does not put the personal assets of the stockholders at risk, other than the value of the investment in the corporation?s stock. However, in the case of a partnership, chapter eleven bankruptcy, the partners? personal assets may be used to pay creditors in the bankruptcy case in some cases. Of course, this could be avoided if the partners filed for personal bankruptcy protection as well.

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Once in bankruptcy, the debtor, with the assistance of the chapter 11 bankruptcy lawyer, is required to perform duties as a debtor in possession with various fiduciary responsibilities and obligations such as accounting and the filing of reports to the bankruptcy court. The Debtor in Possession must report to the U.S. Trustee information about monthly income, operating expenses, and employee compensation. The Debtor in Possession has many powers and duties as a

trustee, and with the approval of the judge, can hire lawyers and accountants, and other professionals to help the debtor while the company is in bankruptcy.

The Debtor in Possession has many powers and duties as a trustee, and with the approval of the judge, can hire lawyers and accountants, and other professionals to help the debtor while the company is in bankruptcy.

If a company is not a small business, the U.S.

Trustee will appoint a committee made up of the seven creditors who have the largest unsecured claims against the debtor. The committee consults with the Debtor in Possession, helps create the reorganization plan, and investigates the conduct of the debtor concerning the operation of the business.

If a company is deemed a small business, a committee is not appointed. Instead, The U.S. Trustee provides additional oversight and imposes

additional reporting requirements from the Debtor in Possession. The Debtor in Possession would have to provide balance sheets, cash-flow statements, and tax returns to the U.S. Trustee.

Like other bankruptcies, Chapter 11 provides automatic stays stopping all judgments, collections, foreclosures, and repossessions of property. However, a secured creditor can get an order granting relief from the automatic stay when the

debtor has no equity in the property, and the property is not needed for an effective reorganization.

During the first 120 days, only the debtor can file a reorganization plan. After 120 days, any interested party can submit a Chapter 11 plan, including the debtor in possession or even the creditors themselves. A Chapter 11 plan must designate claim holders as secured creditors, priority unsecured creditors, non-priority unsecured creditors,

and equity security holders. An entire class of creditors is deemed to accept a plan if they hold at least two-thirds in the amount and one-half of the total amount of claims in the class.

If there are impaired classes of claims, the judge cannot confirm a plan unless it has been accepted by at least one class if creditors holding impaired claims.

The Bankruptcy Judge will confirm a plan if it is determined that the

reorganization plan is feasible, submitted in good faith, and the debtor is complying with the Bankruptcy Code. In order to be feasible, the judge must find that confirmation is not likely to be followed by liquidation or the need for further reorganization. The Bankruptcy Judge will confirm a plan if it is determined that the reorganization plan is feasible, submitted in good faith, and the debtor is complying with the Bankruptcy Code. In order to be

feasible, the judge must find that confirmation is not likely to be followed by liquidation or the need for further reorganization.

If the plan is confirmed, all debt, with some exceptions, is discharged that arose before the date of confirmation. However, the debtor is required to make plan payments and abide by the provisions of the reorganization plan. If you need to file a chapter 11 bankruptcy in Clearwater, New Port Richey, or

anywhere else in the Tampa Bay area, don't hesitate to call an experienced bankruptcy attorney. We offer FREE CONSULTATIONS to help you file your chapter eleven bankruptcy and to help you find a solution to your economic problems.