Jacksonville Chapter 11 Lawyer
What Is Chapter 11 Bankruptcy in Florida?
Chapter 11 bankruptcy is referred to as a reorganization plan filed by corporations, partnerships, and individuals to manage debt. It allows the business or individual to continue operations while establishing a fair, equitable, and feasible way to pay creditors, even while rebuilding enterprise to function well and profitably into the future.
In Jacksonville, Chapter 11 bankruptcy regulations and procedures do not differ significantly with regulations elsewhere in the U.S. However, a Chapter 11 bankruptcy attorney in Jacksonville is more accessible to businesses, banks, and the courts in the northern Florida region and is consequently a better choice when entering this sometimes complex and time-consuming process.
Help with Chapter 11 Bankruptcy
As with any Florida-based businesses, a Chapter 11 bankruptcy filing can help resolve different financial challenges for different businesses.
Our attorneys are experienced in handling the complexities of a Chapter 11 case, including the following which are typical in Chapter 11 proceedings:
- Relief from stay motions
- Use or sale of property, which can include the use of cash collateral
- Assumption or rejection of contracts or leases
- IRS/tax problems
- Divorce of a principal/owner
- Judgements from lawsuits
- Property foreclosure
The reorganization plan may require addressing multiple issues, separately, through evidentiary hearings. The outcome of each hearing can affect the outcomes in others.
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What Are Chapter 11 Bankruptcy Requirements?
The process places several requirements on the filer, all of which are intended to return the business to profitability. At the onset, an automatic stay goes into place that protects the debtor’s assets from continued threat of creditors.
Then, the bankruptcy court provides oversight regarding adequate protection for creditors, setting of compensation, and, to a limited extent, the management of the debtor’s operations while operating under the bankruptcy court’s protection.
Once filed, a Chapter 11 bankruptcy affords the debtor distinct privileges and capabilities not available in any other legal proceeding, such as:
- The debtor is able to acquire financing on favorable terms because new lenders are given priority on earnings.
- The debtor may reject or cancel contracts.
- The debtor may restructure its secured obligations based upon the actual value of the collateral, and not the loan balance.
- Unsecured creditor claims may be structured based upon either what they would get if the debtor was liquidated or its future income.
How We Can Help
As responsible Jacksonville bankruptcy attorneys, we advise potential clients that such a restructuring takes time and effort. Sometimes, timing or available resources direct the company to instead enter a third-party debt restructuring as an alternative to Chapter 11.
This less formal process still requires cooperation with creditors and lenders but is often appropriate for businesses with simpler financial scenarios. For additional information on Chapter 11 bankruptcy, please visit our frequently asked questions page.