By permitting reorganization, Congress anticipated that the business would continue to provide jobs, to satisfy creditors' claims, and to produce a return for its workers. Congress presumed that the assets of teh debtor would be more valuable if used in a rehabilitated business than if 'sold for scrap.'" [United States v. Whiting Pools, Inc. (1983) 462 US 198, 203, 103 S.Ct. 2309, 212-213]
Chapter 11 Bankruptcy
Chapter 11 is a reorganization proceeding, typically used by corporations or partnerships. Under Chapter 11, a debtor ordinarily continues business operations while reorganizing its financial affairs. Reorganization is achieved by way of a written plan of reorganization approved by the court pursuant to the plan confirmation process. Through a confirmed reorganization plan, the debtor can restructure its obligations to creditors and pay those obligations over time.
Individuals, especially those whose debts exceed the limits of Chapter 13, may file Chapter 11. In Chapter 11, the debtor usually remains in possession of his assets and continues to operate any business, subject to the oversight of the court and the creditors committee.
The debtor proposes a plan of reorganization which generally proposes that creditors accept less, often significantly less, than would otherwise be owed them. If the proposed plan is confirmed by the court, generally after a majority of the debtor’s creditors agree to it, the confirmed plan binds both the debtor and the creditors to its terms of repayment. Plans can effect repayment by pledging future profits, selling some or all of the debtor’s assets, or by a merger or recapitalization.
Our office focuses its Chapter 11 practice on individuals and small business representation. Our attorneys typically manage dealings with secured creditors, lenders, lessors, utility companies, the U.S. Trustee, and any creditor or equity committees. Our clients come to us for our affordability and service that big firms can't rival from either an hourly billing dollar figure or in the form an initial retainer requested to represent clients.