We Can Rebuild It, Better, Stronger, Faster – Chapter 11
If you remember The Six Million Dollar Man, there was a famous line at the beginning of the show: “We can rebuild him. We have the technology. We can make him better, than he was. Better, stronger, faster”.
In the US Bankruptcy system, Chapter 11 is the Six Million Dollar Man option for companies that are in financial trouble. Okay, maybe the two aren’t totally analogous, but the goal is very much the same. The company is hoping to emerge better and stronger (whether it comes out the other side like Col. Steve Austin or Peter Griffin from Family Guy).
A company that files a Chapter 11 does so to restructure their debts and make a fresh start. The business will first propose a reorganization plan to the US Bankruptcy Court. If the plan is accepted, the business continues to operate with the goal of emerging as a viable and functional entity.
The bottom line is that the company and its management team in a Chapter 11 need to make some hard choices if it is going to come out of this process successfully. If it does not, then the other alternative is to close its doors and liquidate (i.e., a Chapter 7 Bankruptcy), which we will get into next week.
Here are a few other things that may be of interest:
- State & Local Tax: Navigating a Multi-State Business (Stambaugh Ness Webinar 08/22 @ 2pm EST)
- New Beneficial Ownership Regulations Burden Small Businesses (nfib.com)
- PA Video Series — Misclassification of Workers: What you need to know to protect your business – NFIB
- August 2023 Commentary: Rates and the Consumer | Stonebridge Financial Group (stonebridgefg.com)
- What’s Next Webinar Series – The Next Automation Frontier: HR & Payroll (rklcpa.com) (9/14; 11am-12pm)
As always, please don’t hesitate to email myself (jsanders@mpl-law.com), Andy Miller (amiller@mpl-law.com), Christian Miller (cmiller@mpl-law.com), Erik Spurlin (espurlin@mpl-law.com), Brad Leber (bleber@mpl-law.com) or anyone in our office with questions or comments.
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