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Your Chapter 11 Bankruptcy Case Roadmap

Chap 11.jpgThe Chapter 11 bankruptcy process is notoriously complex. Indeed, the process can feel extremely overwhelming for those looking to reorganize their company's liabilities. Here, our San Jose business bankruptcy attorneys have put together a brief roadmap for what you can expect during your Chapter 11 bankruptcy case. More specifically, we have chronologically outlined some of the key events that will take place during the process.

Day 1: A Chapter 11 case begins when a bankruptcy petition is officially filed with the bankruptcy court. A bankruptcy petition must include a full assessment of the filing company's assets, liabilities, anticipated future earnings and expenses and any other material financial information. It is critically important that the petition is filed correctly. Any mistakes could come back to haunt your business.

Between Day 21 and Day 40: A meeting of the creditors (also known as a 341 meeting) will be held at the discretion of the trustee. The primary reason for this meeting is to ensure that the petitioning business has fairly and accurately represented the full extent of its assets and liabilities. Impacted creditors have a legal right to attend the 341 meeting and they generally may ask questions to the debtor. Questions must be limited to matters that are relevant to the bankruptcy proceedings.

Day 120: This is the last day in which the debtor party has an exclusive right to propose a reorganization plan. After this point, any party to the case, including both creditors and debtors, may submit a reorganization plan for consideration. It should be noted that when good cause is shown, the bankruptcy court has the authority to extend this deadline.

Day 180: This is the last day in which parties can get a voluntary reorganization plan accepted and confirmed. If a petition party is not able to get a plan confirmed, the bankruptcy court will have tremendous power to determine what will happen next in the case. Filing companies should work with their attorney to ensure that they get a reorganization plan that is in their firm's best interest accepted before the deadline. Once again, in limited cases, the bankruptcy court can extend this deadline in cases where good cause to do so can be demonstrated.

Day 300 (Small Businesses): Rule 1020 provides for special considerations for Chapter 11 reorganizations cases involving small businesses. Specifically, these companies have 300 days to file a reorganization plan instead of the standard 180-day period to obtain acceptance of a restructuring plan.

Do You Need Business Bankruptcy Assistance?

Our passionate San Jose bankruptcy attorneys can help. At Diemer, Whitman & Cardosi, LLP, we understand that each Chapter 11 bankruptcy case is unique. From our office in San Jose, we serve businesses throughout Northern California, including in Sunnyvale, Cupertino, and Redwood City.

Source:

https://www.law.cornell.edu/uscode/text/11/341

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