An Overview of the Chapter 11 Bankruptcy Process for 2025
If you are thinking about filing to reorganize your business’s debts under Chapter 11 in 2025, getting started begins with understanding the process. Effective preparation is critical, and anticipating issues that may arise at various stages of the process can help ensure that these issues do not create roadblocks along the way. What can (and should) you expect? What can (and should) you do to prepare? Find out from an experienced Miami business bankruptcy lawyer at Edelboim Lieberman.
Major Stages in the Chapter 11 Bankruptcy Process
There are a variety of ways to break down the Chapter 11 bankruptcy process. For large businesses and complex bankruptcy cases, the specific steps involved can vary widely, and making informed and strategic decisions often requires assessment and reassessment of the business’s options in real time. With this in mind, here is an overview of the major stages of the process from start to finish:
Stage 1: Considering Your Options
The first stage of the process involves considering your options. This includes considering your options for pursuing reorganization under Chapter 11 as well as considering options outside of the formal bankruptcy process. Recognizing that every business’s circumstances are different, some examples of potential options include:
- A traditional Chapter 11 bankruptcy filing
- A pre-packaged or pre-negotiated Chapter 11 filing
- A “small business” filing under Subchapter V of Chapter 11
- A liquidation bankruptcy under Chapter 7
- An informal debt restructuring or another bankruptcy alternative
Stage 2: Preparing for the Chapter 11 Bankruptcy Process
If you decide that reorganizing your business’s debts under Chapter 11 is the best option, then the next stage will involve preparing for the bankruptcy process. This stage alone has several steps.
One of the first steps in preparing for a Chapter 11 filing is to begin gathering all necessary documentation. Businesses filing under Chapter 11 will need to gather numerous documents to ensure that they are making informed decisions and accurate representations and to ensure that they can include all necessary supporting documentation with their bankruptcy petitions.
Beyond gathering necessary documents, preparing for the Chapter 11 bankruptcy process will also involve examining the company’s outstanding liabilities, anticipating potential issues, and ensuring that the business is positioned to continue operating in a compliant manner while its bankruptcy case is pending. Addressing these considerations effectively requires working closely with an experienced Miami business bankruptcy lawyer.
Stage 3: Developing a Preferred Reorganization Plan
Business owners who are contemplating a Chapter 11 filing will also want to work closely with their company’s counsel to develop a preferred reorganization plan. While the business’s creditors will have a say in the structure of the business’s final reorganization plan, starting from a favorable and well-considered framework can help to facilitate an efficient and favorable resolution. When proposing reorganization plans, businesses must ensure that their plans are “feasible,” and they must ensure that their plans appropriately address the varying rights of secured and unsecured creditors.
Stage 4: Filing Your Business’s Bankruptcy Petition (and Related Forms and Documentation)
After completing all necessary preparations, the next stage involves preparing and filing the business’s bankruptcy petition and all related forms and documentation. Companies submitting petitions to the U.S. Bankruptcy Court under Chapter 11 may need to submit various other filings as well. These generally include (but are not limited to):
- A list of creditors or creditor matrix
- A list of the business’s 10 largest unsecured claims
- A summary of assets and liabilities
- Schedule A/B listing the company’s assets
- Schedules D, E/F, G and H listing creditors, contracts and any codebtors
Stage 5: Meeting of Creditors
A key stage in the traditional Chapter 11 reorganization process is the meeting of creditors. As the U.S. Courts explain:
“The U.S. trustee conducts [the] meeting of the creditors, often referred to as the ‘section 341 meeting,’ in a chapter 11 case. . . . The U.S. trustee and creditors may question the debtor under oath at the section 341 meeting concerning the debtor’s acts, conduct, property, and the administration of the case.”
Thoroughly preparing for the meeting of creditors is essential, as the outcome of this meeting can have a major impact on the subsequent stages of the process—including whether the process ultimately results in a successful reorganization. As a result, working closely with the business’s bankruptcy counsel at this stage is critical as well.
Stage 6: Working with Creditors and the Bankruptcy Trustee
When going through the Chapter 11 reorganization process, businesses may need to work with their creditors and the bankruptcy trustee to address and resolve a wide range of issues. These can include everything from dealing with creditors’ efforts to seek relief from the automatic stay and avoid discharge to seeking the trustee’s approval for transactions outside of the normal course of business. Mistakes and oversights at this stage can lead to significant setbacks and unnecessary challenges, so informed and strategic decision-making is required.
Stage 7: Finalizing a Reorganization Plan, Plan Confirmation and Discharge
The last stage in a Chapter 11 bankruptcy case is to finalize the business’s reorganization plan (with the approval of the business’s creditors), secure confirmation of the plan from the bankruptcy court, and then complete the discharge process. It should be noted, however, that creditors can seek to reopen Chapter 11 bankruptcy cases if debtors do not comply with the terms of their reorganization plans. As a result, it is critical to ensure that your business’s plan is truly feasible—not only as this term is defined in the U.S. Bankruptcy Code, but from a practical perspective as well.
Schedule a Call with a Miami Business Bankruptcy Lawyer at Edelboim Lieberman
If you are considering a Chapter 11 business bankruptcy in 2025, our lawyers can help you make informed and strategic decisions with your business’s long-term best interests in mind. To schedule a call with an experienced Miami business bankruptcy lawyer at Edelboim Lieberman, give us a call at 305-768-9909 or tell us how we can reach you online today.
