Washington businesses that are overburdened by financial obligations can face difficult choices. Companies may be forced to lay off employees, refrain from paying vendors, or default under mortgage loans or other bank financings. Restructuring business debt through Chapter 11 bankruptcy may help avoid these problems. Ben Cushman is an Olympia attorney who can help clients protect the businesses they have worked so hard to build. Ben has been licensed to practice law since 1996 and is experienced working with businesses throughout the state. Contact us today to schedule a consultation with a lawyer. We also serve Tacoma as well as other areas in Washington.
Attorney assisting Olympia and Tacoma businesses through the Chapter 11 bankruptcy process
Chapter 11 of the U.S. Bankruptcy Code allows a business to reorganize its debts and to continue operating while doing so. This type of bankruptcy is most commonly used by businesses wishing to restructure their financial obligations and needing relief from their creditors in order to rebuild. It is possible, but far less common, for individuals to seek Chapter 11 relief. It is important to remember that owners of corporations or limited liability companies are not typically held personally liable for the debts of the business. Unless they have personally guaranteed a debt, their personal assets and finances are not generally at risk when the company files bankruptcy. Bankruptcy for partnerships and entities operated by sole proprietors may, on the other hand, involve the personal assets of the owner and may require both business and personal bankruptcy filings. This means that the Chapter 11 process may not be the best choice for everyone. An attorney can help determine if Chapter 11 bankruptcy is the right approach for your company.
The process begins with the filing of a Petition with the bankruptcy court. Once the Petition has been filed, an “automatic stay” goes into effect, which prohibits creditors from attempting to collect debts or enforce terms of an outstanding loan or credit facility. The Chapter 11 Petition must include a plan for how the company will operate during bankruptcy and how it will manage creditors, contractual obligations, employment issues, and more. The plan will include new proposed terms for reducing and restructuring loans and other obligations. For large companies, the reorganization plan must be approved by a committee of creditors. The creditors’ committee will also monitor the company’s compliance with the plan and business operations during the bankruptcy. Smaller businesses may be handled exclusively by the U.S. Trustee. The business will be considered a “Debtor in Possession,” meaning that it still owns assets and is operating through the restructuring process. The Debtor in Possession is required to periodically report to the U.S. Trustee and creditors’ committee. For large businesses, it may be a long time before the company can emerge from the bankruptcy process. Smaller entities may proceed more quickly if they qualify for expedited deadlines and less onerous reporting procedures.
Chapter 11 proceedings can be complicated and involve complex legal theories. Ben Cushman is an Olympia lawyer with experience in such matters. Ben has been representing Washington residents since 1996. His understanding of business law issues and the bankruptcy process will help ensure that your company’s interests are protected. Bankruptcy can be a difficult decision but can help keep a business alive in the face of financial hardship. We will focus on your legal issues so that you may focus on rebuilding your company’s future. Contact us today.
Washington lawyer focused on client service through Chapter 11 bankruptcy
Ben is an attorney who understands the demands of running a business. He knows that economic downturns can wreak havoc on a company’s ability to meet payroll, pay vendors, and repay debt. His business clients receive the highest levels of customer service throughout any legal matter. Ben promptly responds to client requests and questions and takes pride in being a trusted business advisor to companies in Olympia and throughout other areas of Washington.
Our firm also serves the Thurston County cities of Lacey, Tumwater, and Yelm, the Pierce County cities of Tacoma, Puyallup, and Lakewood, the Lewis County cities of Centralia, Chehalis, the King County cites of Seattle, Auburn, Bellevue, Burien, and Federal Way, as well as other areas in Washington, including Grays Harbor, Mason, Cowlitz, and Pacific Counties.