Discount retailer, Tuesday Morning, has several stores in Tennessee that are likely to be closing soon. These stores are part of a chain that includes more than 400 stores nationwide. Due to a lack of sales, which has sparked a severe financial crisis, corporate officials have asked a court to approve the company’s petition for Chapter 11 bankruptcy.
The bankruptcy plan in question would involve a restructuring of the company’s debt payment programs, as well as the permanent closure of more than 200 stores, including several that are based here in Tennessee. It is the second time that Tuesday Morning has used bankruptcy as a financial tool to help save the business. Company officials believe that closing hundreds of stores will enable the rest of the stores to restore solvency.
Chapter 11 bankruptcy helps businesses in trouble
A business owner can propose a reorganization plan under the Chapter 11 program. Creditors can challenge the plan, and the court must ultimately approve it. This type of debt relief is often better for businesses than Chapter 7, which typically involves the liquidation of all assets. Under Chapter 11, a business is often able to continue to function while a restructured payment plan is implemented.
Any Tennessee business owner who wants to learn more about Chapter 11 bankruptcy or other debt-relief options may request a meeting with a bankruptcy attorney. This is often the first step toward overcoming a financial crisis and executing a plan that enables a business to stay afloat. An attorney can also represent the business throughout the bankruptcy filing in case any legal complications arise.