Moody, AL—Business owners in Alabama are able to remain open and continue with operations when they file for Chapter 11 bankruptcy. Chapter 11 bankruptcy is referred to as “a reorganization bankruptcy” as it allows businesses to get their financial affairs in order while still having control over their business.1 It also allows business owners to “borrow new money,” which may help the business get back on its feet and push towards success.
How does Chapter 11 bankruptcy work?
A business can begin the bankruptcy process by filing a petition with its local bankruptcy court. In addition to filing the petition, the United States Courts say a business owner is also required to submit to the court the following:
- A schedule of their current income and expenses.
- A schedule of their executory contracts and any lease agreements that have not yet expired.
- “Schedules of assets and liabilities.”
- “A statement of financial affairs.”
The debtor (i.e. the person or business filing for bankruptcy) will also need to submit a plan of reorganization. This plan of reorganization should outline how the debtor plans on paying back their creditors over a specified period of time and how they intend on continuing with operations.
Because the court and creditors must approve this plan, a business owner should retain a Moody, Alabama bankruptcy attorney who can assist them with writing theirs up. If a business owner is considering filing for Chapter 11 bankruptcy or has questions regarding their eligibility, they can contact Hill, Gossett, Kemp & Hufford, P.C.
Belk Retailer Files for a Reorganization Bankruptcy
Chapter 11 bankruptcy is common among businesses that experience financial hardship but aren’t quite ready to close their doors. Belk, which is a large retail chain with locations in various states across the U.S., recently decided to file for a reorganization bankruptcy in order to relieve itself of the $450 million it racked up in debt.
The retailer will remain in control of its stores during the bankruptcy proceedings and use the new capital it gained to get itself back in order. While the Chapter 11 bankruptcy will help the company rise from its debt, Forbes says it will need a new plan if the company wants to see a positive turnaround.
If a business has fallen into debt and needs more information on filing for Chapter 11 bankruptcy, they are encouraged to contact Hill, Gossett, Kemp & Hufford, P.C. to schedule an initial consultation with an experienced Moody, AL bankruptcy lawyer.
Disclaimer: No representation is made that quality of legal services provided is greater than the quality of legal services provided by other attorneys.
Hill, Gossett, Kemp & Hufford, P.C. can be reached at:
2603 Moody Parkway, Suite 200
Moody, Alabama 35004
Phone: (205) 640-2000
7900 Parkway Drive
Leeds, AL 35094
Phone: (205) 699-5500
6441 U.S. Highway 11
Springville, Alabama 35146
Phone: (205) 467-2225