Often referred to as a “reorganization bankruptcy,” there are specific guidelines that have to be met for a business to qualify for this version of bankruptcy.
If it’s a voluntary petition, debtors have to file specific information to potentially qualify. In contrast, creditors can file for an involuntary petition if your business already meets certain debt-related circumstances.
Above all, a Chapter 11 bankruptcy proceeding ultimately affects the business and likely not your own personal interests beyond any investment value you have in the company unless your assets are needed to pay back creditors.
The highly involved and technical nature of Chapter 11 bankruptcy proceeding means it’s crucial to have proper representation that understands every step and how it can affect your own personal standing, whether as an owner, founder, or investor.