In Traditional Chapter 11 it is necessary to prepare a detailed “Disclosure Statement” similar to a prospectus for the purchase of securities. Preparation of such document is time-consuming and expensive. Then it must go through a hearing process and the judge must determine that it contains “adequate information” for creditors to decide whether or not to vote in favor of the plan.
The new law eliminates this step and allows debtor’s counsel to provide certain basic information in the Plan, itself. This saves time and expense, helping to make the chapter 11 process affordable.
This is only one of the many reasons the new Small Business Bankruptcy Chapter 11 may be a real “life-saver” for struggling small business owners.
Paul Hollender is Board-Certified in both Business and Consumer Bankruptcy, and has been helping business owners deal with financial difficulties for 43 years.
If you think this new law might help you, please call (718) 442-4424 to schedule an evaluation and strategy meeting.