Navigating the complex small business bankruptcy process
Owning a small business can be extremely rewarding both personally and financially. There are times, however, when the financial side of things just doesn’t go as planned. There are many different reasons why small businesses have financial issues, but regardless of the case, bankruptcy can be a good tool to deal with the situation at hand. When you are considering bankruptcy as a small business, the first thing to remember is that bankruptcy does not necessarily mean you are going out of business. While it can certainly be used as part of the going-out-of-business process, it is often used to help avoid that result entirely.
Here at The Law Offices of B David Sisson, we have been helping small business owners in Oklahoma deal with their debt and bankruptcy issues since 1990. This level of experience won’t be easy to find anywhere else, and when combined with our passion for helping every client who walks through the door, you’ll see why we are the ideal choice when your business is having financial issues. The best way to start this process is to learn more about the process and implications of bankruptcy for a small business.
Chapter 11 Bankruptcy
Chapter 11 Bankruptcy was made specifically with businesses in mind, and the laws that apply to this process generally allow the business to remain operating before, during, and after the bankruptcy process.
While in Chapter 11 bankruptcy, the courts will appoint a trustee, who will help to formulate a debt reorganization plan that will help the business as well as get the creditors as much of the money that they are owed as possible. The trustee will also have some oversight of the business to ensure it is being run properly in regards to its finances.
When the courts approve and recognize a plan, the small business will need to begin making the agreed upon payments. In most cases, the plan will include a combination of some debt being discharged, and some debt being retained and put on a reasonable payment plan. The bankruptcy process can also allow the small business to terminate contracts or leases that are deemed to be overly burdensome to the business.