Owning a business in California requires hard work, dedication and money. You may have made some poor planning decisions that have now led you swimming in debt.
You do not believe that shutting your doors is the answer, and here at LimNexus, we may agree. Finding yourself in a mountain of debt is not pleasant, and facing bankruptcy may seem scary. However, filing under Chapter 11 bankruptcy may save your business in the long run.
The basics of Chapter 11
Businesses and corporations of varying sizes may qualify for bankruptcy relief under Chapter 11. Companies facing too many bills with too little cash flow may qualify to file under the terms of Chapter 11. This chapter of the code allows companies to restructure their debt and come to terms with creditors. If your company follows through with the restructuring plan, most of your debt may go away by the end of the process.
Business as usual
During the court process, your business may continue to operate. Customers and clients may get wind of your woes and become uncertain of transacting with you. However, you can explain where you are in the process and how you plan to restructure your business to offer them a better experience. While your business is proceeding, you will not have the freedom to make financial and business decisions as usual. There are some things, like the sale of assets that the court must approve before you can do them. Other actions, like selling inventory, can usually occur without permission.
Bankruptcy is one way to save a drowning business. To get a better handle on the process and how your company may benefit, consult our website