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Business & Commercial Bankruptcy Archives

Company's restructuring leads to restaurant closing

Chapter 11 bankruptcy protection provides businesses with an opportunity to stop, restructure and repair problems that are threatening the company's financial health. It can mean the difference between saving the company and having to shutter the doors.

Bankruptcy and the small business

Many owners of small businesses in Bradley County do not make a sharp distinction between their business finances and personal finances. These owners treat their businesses as if the business were merely another category of personal finances. Unfortunately, for these businesses and their owners, the lack of a clear distinction may create unexpected hardships, if the business falls on hard times -- and especially, if bankruptcy appears to be the only remedy for the business.

Valuing a business in a Chapter 11 bankruptcy

When a Tennessee business faces the possibility of filing a bankruptcy petition, one of the first questions that is asked is whether to seek reorganization under Chapter 11 or dissolution under Chapter 7. If the business chooses, the former, its executives and advisors will be required to answer a number of questions about the value of the company and its assets. Understanding these questions and how to answer them is a necessary prerequisite to choosing between Chapter 11 and Chapter 7 business bankruptcy.

Gibson seeks bankruptcy protection using pre-negotiated plan

After months of negotiations with creditors, Gibson Brands, Inc., the Nashville-based maker of legendary Gibson guitars, has filed a petition under Chapter 11 of the Bankruptcy Code. The filing was accompanied by a plan of reorganization that had already been negotiated with the company's creditors. The plan offers lessons for both large and small companies considering a business bankruptcy.

Car dealer bankruptcy clouded by allegations of fraud

The bankruptcy process depends in many ways on cooperation between the debtor and its creditors to resolve issues about asset value, existing debts and the history of the business before the petition is filed. When the parties cannot reach agreement, or when the disagreements become particularly intense, the bankruptcy court often takes a more active role in monitoring the parties' behavior. The commercial bankruptcy of Auto Masters, a group of used car lots in and around Nashville, has recently taken such a turn.

How debtor-in possession financing can help a small business

Tennessee business owners who decide to file a petition for bankruptcy under Chapter 11 of the Bankruptcy Code intend to reform their company's finances and to emerge from bankruptcy slimmed-down and healthy. One of the most effective tools to achieve this intent is debtor-in-possession financing.

What is a small business bankruptcy case?

When a small business in Rockland County is failing financially, the owner usually considers two types of bankruptcy - a dissolution under Chapter 7 of the Bankruptcy Code or reorganization under Chapter 11. Choosing the former usually means that the business will ultimately be dissolved, and the latter may cost many thousands of dollars in filing fees and attorney costs. A compromise is provided by provisions in the Bankruptcy Code directed at small business bankruptcies - the so-called "small business case."

Toys 'R' Us calls it quits after reorganization efforts fail

Business bankruptcies generally do not evoke an emotional response from anyone other than the company's shareholders and employees. A rare exception to that rule is the reaction to the recent announcement by toy retailer Toys 'R' Us that it will close all of its 740 stores in the United States over the next few months. The announcement was greeted with sadness and a sense of loss by the millions of adults who remember spending their childhoods wandering through the aisles of their favorite Toys 'R' Us store. The causes of this large commercial bankruptcy provide powerful warning signs for other big box retailers.

Tennessee-based nursing home chain files Chapter 11 petition

A firm that files a Chapter 11 bankruptcy petition often engages in complex and lengthy negotiations with its creditors during the course of the bankruptcy process. In some bankruptcies, however, these kinds of negotiations often occur before the petition is filed. Such pre-petition negotiations are often undertaken to determine if a suitable plan of reorganization is possible. A Chapter 11 petition may be fruitless if one or more large creditors are not willing to renegotiate the terms of their agreements with the debtor. An example of a pre-petition negotiation was recently provided in connection with the business bankruptcy filing of a large nursing home operator based in Tennessee.

What is involuntary bankruptcy?

Creditors of a failing business in Tennessee often regard the filing of a bankruptcy petition by a creditor with dread because they fear that their claims will be dismissed by the bankruptcy court. Why, then, would a creditor want to force a debtor into business bankruptcy by filing what is known as an "involuntary petition"?

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