Author Archives: Michael J. Berger
Chapter 11 or Subchapter V Can Ease the Burden of Personal Guarantees
For many small-business owners, a personal guarantee is part of doing business. A lender, landlord or supplier asks for a signature and the owner signs, often without weighing what it means. But a guarantee turns a company obligation into a personal one. If the business seriously falters, the creditor can pursue the owner’s home, savings […]
Should a Small Business Choose Subchapter V or Chapter 11?
Subchapter V and traditional Chapter 11 offer two distinct paths for restructuring small businesses. They operate very differently in terms of cost, speed, creditor involvement and owner control. Subchapter V provides a streamlined and more affordable option, but Chapter 11 remains the better fit for companies with larger debts or more complex creditor relationships. Here […]
Vendor Management in Chapter 11: Keeping Critical Suppliers on Board
Vendor management is an important operational challenge for small and mid‑sized businesses navigating Chapter 11. Vendors that supply essential goods or services play a critical role in whether the business can continue operating during the case. Effective vendor management helps stabilize the supply chain, maintain customer relationships and support the feasibility of the reorganization plan. […]
The Role of Financial Projections in Chapter 11
In a Chapter 11 case, creditors, potential lenders as well as the bankruptcy court rely on financial projections as indicators that the debtor company has a realistic path toward rehabilitation. For small and medium-sized businesses, cash flow is often tight and market conditions can shift quickly. Credible projections can determine whether a Chapter 11 plan […]
How Businesses Can Use Chapter 11 to Stop Secured‑Creditor Actions
When a financially distressed company is facing repossession, foreclosure or a sudden cutoff of operating funds, Chapter 11 can create the breathing room needed to stabilize operations and negotiate a workable path forward. When a business files a Chapter 11, an automatic stay goes into effect instantly. This injunction freezes all collection activity, including repossessions […]
Basic Steps in a Chapter 11 Case for Small and Mid‑Sized Businesses
Chapter 11 is a court-supervised process that allows financially distressed small and mid-sized businesses to restructure their debt, continue operating and develop a viable path to financially stable ground. The business ordinarily remains in control of its operations as a “debtor in possession,” but there are reporting and fiduciary responsibilities, and certain decisions require courts […]
How a Small Business Can Build a Feasible Subchapter V Plan
Subchapter V bankruptcy is a streamlined form of Chapter 11, designed to give troubled small businesses a faster, more affordable path to reorganize their debts and emerge solvent. Unlike in a traditional Chapter 11, there is no requirement that creditors approve a Subchapter V plan. However, the bankruptcy court must confirm the plan, which it […]
What Executives Should Expect in the First 30 Days of a Chapter 11 Case
The first month of a Chapter 11 case can be the most demanding phase. Company executives must secure access to cash, protect essential business relationships and establish the strategic direction of the case. Decisions made during the first 30 days can ultimately determine whether the company continues operating and regains its momentum or enters into […]
Tools Mid‑Sized Companies Can Use to Restructure Debt in Chapter 11
Rising interest rates, equipment payments, real estate loans or a temporary decline in revenue can leave an otherwise viable business unable to keep up with its debts. When individual negotiations with creditors are no longer enough, Chapter 11 can serve as a lifeline, letting the business modify secured loans, exchange debt for equity, sell assets […]
Using Chapter 11 to Reshape Unworkable Agreements
There are many reasons why a once-thriving business might end up in financial straits. One of these may be that longstanding contracts that once made good sense have become burdensome as financial conditions have changed. Above-market lease payments, expensive supplier contracts or unfavorable service agreements can drain cash flow and threaten a company’s solvency. When […]
