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Chapter 11 business bankruptcy

Question
What is Chapter 11 business bankruptcy? 
Answer
Chapter 11 business bankruptcy is a reorganization plan proposed by a debtor business with two primary goals: To allow the company to continue operating, and structure a repayment schedule to creditors on record prior to the bankruptcy filing.

The reorganization must be confirmed by the court and approved by creditors before distributions are made.

The day after the Chapter 11 bankruptcy filing, the reorganized company begins what is essentially a new life with regard to dealing with future financial contracts and relationships. 
Brain Trust contributor: Editor, Streetwise Small Business Book of Lists
Related Categories: Credit, Legal, Negotiating
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