So you’ve decided that it’s time that your business gets a fresh start and after discussing your options with a bankruptcy attorney you determine that a Chapter 11 bankruptcy/reorganization is right for you. That’s great that you are moving forward, but know that when filing a Chapter 11 bankruptcy petition, there are certain deadlines to be aware of so that your case may proceed. Here are 3 deadlines that you should be cognizant of when filing:
Within 60 days of filing a Chapter 11 case, the debtor must submit a written disclosure statement with the court. This contains information regarding the corporate assets, liabilities and business affairs. Also included is a description of the corporate structure, clients and market, historical financial statements for the past 3 years, and a description of the Chapter 11 plan.
After you file, you generally have the exclusive right to file a reorganization plan within 120 days. This period is exclusively for the debtor business so that it can seek to find financing and to discuss payment options with creditors and renegotiate contracts. The plan must designate which creditors are secured, or unsecured and entitled to priority, are general unsecured creditors, and those who are equity security holders.
An adversary proceeding has time limitations. An adversary proceeding is a lawsuit filed in bankruptcy court, usually seeking to avoid fraudulent transfers, preferential transfers or to avoid liens. The bankruptcy code requires such actions to be filed within 60 days after the 341 meeting, or initial meeting of creditors.
In a Chapter 11, debtors can consolidate any objections into a single pleading so long as the claims made are similar. The debtor has to list the claims to which the objection applies and cite the legal basis for eliminating or reducing the claims. Claims filed after the 60 day deadline can be included.
Chapter 11 bankruptcies are extremely complicated and require the experience of a Chapter 11 attorney who can properly advise you and assist you in formulating a workable operating plan to keep your business functioning and on a path to profitability. DCDM Law Group has been providing Chapter 11 bankruptcy assistance to businesses of all types and have eliminated millions in debt on behalf of their clients.