Chapter 11 (also known as a Reorganization) ordinarily is used by commercial enterprises that desire to continue operating a business and repay creditors concurrently through a court-approved plan of reorganization. The chapter 11 debtor usually has the exclusive right to file a plan of reorganization for the first 120 days after it files the case and must provide creditors with a disclosure statement containing information adequate to enable creditors to evaluate the plan. The court ultimately approves (confirms) or disapproves the plan of reorganization. Under the confirmed plan, the debtor can reduce its debts by repaying a portion of its obligations and discharging others. The debtor can also terminate burdensome contracts and leases, recover assets, and rescale its operations in order to return to profitability. Under chapter 11, the debtor normally goes through a period of consolidation and emerges with a reduced debt load and a reorganized business.
Contact Davis Law for all your Chapter 11 Bankruptcy matters. We can be reached at 404.901.2500 and 770.922.8500, or send us a message from our website - Contact Davis Law.
The Northern District of Georgia Bankruptcy Court provides more information on Chapter 11 Bankruptcies on their website - Chapter 11 Bankruptcy Basics.
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