When a business owner receives permission to operate the business as debtor-in-possession, he or she can manage contracts and obtain financing from new lenders, all while under the protection of an automatic stay. If the court deems the business owner is not responsible enough to continue business operations, the bankruptcy court assigns a trustee to operate the business. As with any type of bankruptcy, there are advantages and disadvantages, depending on the handling of the bankruptcy. When creditors take a stand against restructuring debt, Chapter 11 can provide the leverage necessary for reorganization, and sometimes save jobs and company value. An experienced bankruptcy lawyer can help you evaluate your situation and advise you about filing Chapter 11.
If you are considering Chapter 11 to address your financial problems, contact the Law Offices of Craig A. Burnett for a free consultation.