Chapter 11 bankruptcy is an important legal protection any struggling business wondering what they will do and considering bankruptcy should be familiar with. It can help a struggling business remain in business and keep their doors open while they reorganize their debt and seek debt relief and a return to profitability.
Reduced sales, profits and tax obligations can leave many businesses in Tennessee struggling. Chapter 11 bankruptcy can potentially help the struggling business through difficult economic times. The chapter 11 bankruptcy process will help the struggling business through the bankruptcy process and with the help of the bankruptcy court, the struggling business can remain in business provided it generates enough revenue to meet its obligations according to the reorganization plan.
In addition to the worries of staying in business, struggling business owners may have worries related to the threat of eviction, foreclosure or repossession of company cars and equipment. As this blog recently discussed, the automatic stay that goes into effect once the filing party files for bankruptcy, and is available in circumstances of Chapter 11 bankruptcy as well, stops all creditor collection actions and contact from proceeding while the bankruptcy process is ongoing. In addition to Chapter 11 bankruptcy, if a business has made the difficult decision to close their doors, other bankruptcy options may be available help them as well including Chapter 7 bankruptcy.
Bankruptcy protections can relieve stress and overwhelming debt concerns for struggling businesses and individuals in many instances. As a result, any struggling business looking for options to help should make sure they understand how Chapter 11 reorganization bankruptcy may be able to help them.