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Chapter 11

CHAP-ter i-LEV-en
A form of bankruptcy in the United States that allows a business to reorganize its debts and operations while continuing to operate. It provides a structured process for companies to negotiate with creditors and propose a plan for repaying debts over time.
The company filed for Chapter 11 bankruptcy protection to restructure its debt and avoid liquidation.
General Motors Chapter 11 reorganization (2009)
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Frequently Asked Questions

What is the purpose of Chapter 11 bankruptcy?

The purpose is to give a struggling business a chance to reorganize, negotiate with creditors, and continue operating while repaying debts.

How does Chapter 11 differ from Chapter 7 bankruptcy?

Chapter 7 involves liquidation of assets to pay off debts, while Chapter 11 focuses on reorganization and continued operation.

What is a Chapter 11 plan?

It is a detailed proposal outlining how the debtor plans to restructure its debts, operations, and finances to become profitable again.

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