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Warren Resources Files for Chapter 11 Bankruptcy Protection

restructuring.jpgAccording to reporting from Reuters, Warren Resources, an oil and gas company, recently filed for Chapter 11 bankruptcy protection. The company, which operates heavily in California, has been hit hard by the steep decline in energy prices. Court filings indicate that Warren Resources currently has approximately $230 million in assets and $545 million in liabilities on their books. Chapter 11 bankruptcy protection will give the company an opportunity to restructure those obligations. If you think your business might need Chapter 11 reorganization, please contact an experienced California Chapter 11 bankruptcy attorney for immediate legal assistance.

Understanding the Process: Chapter 11

Chapter 11 is often one of the most desirable options for companies facing severe financial distress. However, the process can be both complicated and time consuming. If you are considering Chapter 11 for your business, you should always speak to an experienced attorney before moving forward. The following is a broad overview of the steps of the Chapter 11 process:

  • Filing the petition: First, your company will need to file a Chapter 11 petition. This petition must include a comprehensive assessment of all of your company's key financial information. This includes the assets, liabilities, expected future income and expected future expenses. It is critical that you file a well-crafted petition. Generally, your petition will entitle a company to an automatic stay. An automatic stay is very valuable as it will grant your company temporary relief from most debt collection efforts.
  • Providing information: During the process, your company will be likely be required to provide monthly operating reports. These reports give your creditors, the court, and bankruptcy trustees an opportunity to assess the financial condition of the business.
  • Disclosures: Disclosure statements must be made to every creditor. This will include basic information on how creditors can exercise their rights during the bankruptcy process.
  • Submitting your plan: Eventually, your company will submit the proposed restructuring plan. This step is extremely complex, and your plan must conform to all legal requirements. For example, all Chapter 11 plans are required to explain exactly how each class of creditor will be treated.
  • Confirmation: Before your Chapter 11 restructuring plan can go into effect, it will need to be approved at a confirmation hearing by a bankruptcy judge. Creditors will have an opportunity to vote on your plan.
  • Following through: Finally, after a restructuring plan has been approved by the court, your company will need to follow through on the plan's obligations. At this point, your plan will constitute a new legal binding contracts with all creditor, and your company will be legally required to make payments that are consistent with the terms of the plan.

Need Legal Advice?

If your business is currently facing financial distress, please contact Diemer, Whitman & Cardosi, LLP today. Our passionate San Jose bankruptcy lawyers can help you find a solution that truly fits the needs of your business. Please contact our San Jose office today at 408-971-6270 to set up a free case evaluation. We serve business clients throughout Silicon Valley, including in Palo Alto, Mountain View, Sunnyvale and Cupertino.

Sources:

http://www.reuters.com/article/warrenresources-bankruptcy-idUSL1N18U2BT

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