Lamberth, Cifelli, Ellis & Nason, P.A., is a boutique Atlanta law firm focusing on representing individuals and businesses in bankruptcy proceedings. For more information about the Chapter 11 bankruptcy process for businesses, contact our law office.
Experienced Business Bankruptcy Attorneys
The lawyers at our firm have a wealth of experience in prosecuting Chapter 11 reorganization proceedings. We help business clients and individual debtors with business-related debts confirm a plan of reorganization or a plan of liquidation.
We also advise noninstitutional (nonbank) creditors of their rights in connection with any treatment proposed to be provided with regard to their claims under a debtor’s Chapter 11 plan. For every client, whether a debtor, creditor, or trustee, we have the experience necessary to counsel businesses and individuals with regard to Chapter 11 reorganizations.
The Chapter 11 Bankruptcy Process
In a Chapter 11 reorganization, a written disclosure statement and a plan of reorganization must generally be filed with the court. The disclosure statement is a document that provides information concerning the debtor’s assets, liabilities, and business affairs. The debtor may be an individual or a business.
The information provided must be sufficient to enable a creditor to make an informed judgment about the debtor’s plan of reorganization. The proposed plan is required under the Bankruptcy Code to include a classification of claims. It must also specify how each class of claims will be treated under the plan.
Creditors whose claims are “impaired,” (those whose contractual rights are to be modified, or who will be paid less than the full value of their claims under the plan) are permitted to file ballots to vote to accept or reject the plan. After the ballots are collected and tallied, the court will conduct a confirmation hearing to determine whether to confirm the plan.
The confirmation hearing can often result in litigation (including the filing of briefs, and the representation of the debtor or creditors at hearings before the bankruptcy judge), because any party in interest may file an objection to confirmation of a plan. Before confirmation can be granted, the court must be satisfied that there has been compliance with all the other requirements of confirmation set forth in section 1129 of the Bankruptcy Code. In order to confirm the plan, the court must find, among other things, that:
1. The plan is feasible
2. The plan is proposed in good faith
3. The plan and the proponent of the plan are in compliance with the Bankruptcy Code
Lamberth, Cifelli, Ellis & Nason, P.A., has experience representing clients in confirmation hearings. During our representation of Hartwell Industries, Inc. (an importer, manufacturer and distributor of casual and sports apparel) in its Chapter 11 case, various subordinated noteholders filed objections to confirmation of Hartwell’s proposed plan. Our firm was successful (following the preparation and filing of briefs and an evidentiary hearing) in obtaining confirmation of the proposed plan over the objection of the subordinated creditors.
For more information about business restructuring, contact an attorney from our firm today to set up an initial consultation.