This is the first post in a series of articles discussing small business bankruptcies in Olympia or Tacoma, Washington. For a variety of reasons, small businesses are often disproportionately impacted by economic downturns or recessions. In tough financial circumstances, a business may decide its only option is to seek relief through bankruptcy. The goal of this series is to provide information about bankruptcy options and possible alternatives for small businesses and their owners. Whichever path your business chooses, it will be imperative to engage experienced bankruptcy counsel to help navigate this complex process. If you need assistance, contact our office today to speak with an Olympia attorney.
This series will address the following topics:
- Restructuring a small business through Chapter 11 bankruptcy
- The effect of business bankruptcy on personal guarantees and owner finances
- The Chapter 11 process
- Alternatives to Chapter 11 bankruptcy
These are important subjects for any small business to understand. First, Chapter 11 of the U.S. Bankruptcy Code allows businesses to continue operations while restructuring their debts and liabilities. Companies are protected from certain legal actions by creditors and given an opportunity to rebuild their operations. Second, depending upon which type of entity the small business is, owners of the company may or may not have personal liability for the business’s debts. In addition, stakeholders who personally guarantee company obligations will not be protected by a business’s bankruptcy filing. Third, the Chapter 11 process can be complicated. Depending upon the size of the business, different monitoring and reporting rules as well as filing deadlines may apply. Our firm can help you understand what to expect in a Chapter 11 proceeding. Finally, there may be alternative options available for businesses in financial trouble. These include other forms of bankruptcy, such as Chapter 7 or 13, or extensive renegotiation of credit facilities or other liabilities. It is important to evaluate and understand how each choice may impact your business.
If you need assistance with a small business bankruptcy matter, contact our office today to speak with an Olympia attorney. The firm also services the Thurston County cities of Lacey, Tumwater, and Yelm, the Pierce County cities of Tacoma, Puyallup, and Lakewood, the Lewis County cities of Centralia, and Chehalis, the King County cities of Seattle, Auburn, Bellevue, Burien, and Federal Way, as well as other areas in Washington, including Grays Harbor, Mason, Cowlitz, and Pacific Counties.