Chapter 11, Title 11, United States Code

related topics
{company, market, business}
{law, state, case}
{service, military, aircraft}
{work, book, publish}
{day, year, event}

Chapter 11 is a chapter of the United States Bankruptcy Code, which permits reorganization under the bankruptcy laws of the United States. Chapter 11 bankruptcy is available to every business, whether organized as a corporation or sole proprietorship, and to individuals, although it is most prominently used by corporate entities. In contrast, Chapter 7 governs the process of a liquidation bankruptcy, while Chapter 13 provides a reorganization process for the majority of private individuals.

Contents

Chapter 11 in general

When a business is unable to service its debt or pay its creditors, the business or its creditors can file with a federal bankruptcy court for protection under either Chapter 7 or Chapter 11.

In Chapter 7 the business ceases operations, a trustee sells all of its assets, and then distributes the proceeds to its creditors. Any residual amount is returned to the owners of the company. In Chapter 11, in most instances the debtor remains in control of its business operations as a debtor in possession, and is subject to the oversight and jurisdiction of the court.[1]

Features of Chapter 11 reorganization

Chapter 11 retains many of the features present in all, or most, bankruptcy proceedings in the U.S. It provides additional tools for debtors as well. Most importantly, 11 U.S.C. § 1108 empowers the trustee to operate the debtor's business. In Chapter 11, unless a separate trustee is appointed for cause, the debtor, as debtor in possession, acts as trustee of the business.[2]

Full article ▸

related documents
Amway
Arthur Andersen
Poison pill
Lloyd's of London
Gresham's law
Ponzi scheme
Railtrack
Natural monopoly
Economy of Nepal
Economy of Guinea
Economy of Togo
MCI Inc.
Economy of Qatar
Economy of Mongolia
Economy of Malta
Economy of Tanzania
Carlyle Group
Economy of Somalia
World Bank
Conglomerate (company)
Telefónica
Economy of Saint Kitts and Nevis
Economy of Azerbaijan
MSC Malaysia
Economy of Hungary
Economy of Kazakhstan
Economy of Ghana
Economy of Barbados
Investment
Financial capital