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Chapter 11
Guiding Businesses Through Reorganization and Renewal
Chapter 11 of the U.S. Bankruptcy Code provides financially distressed companies with a pathway to restructure debt, preserve operations, and emerge as viable enterprises.
It is not merely a legal process—it is a strategic tool for companies to stabilize their business, renegotiate obligations, and protect stakeholder value.
At SJKP LLP, our Insolvency & Restructuring (I&R) attorneys represent debtors, creditors’ committees, trustees, secured and unsecured creditors, and asset purchasers in complex Chapter 11 proceedings across industries including aviation, energy, healthcare, real estate, and finance.
We combine deep legal expertise with commercial insight to deliver solutions that balance compliance, recovery, and long-term stability.
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1. Chapter 11: Understanding the Process
A Framework for Business Rehabilitation
The Chapter 11 process allows a company (the debtor) to reorganize under the supervision of a bankruptcy court while continuing operations.
Unlike liquidation, Chapter 11 focuses on maximizing enterprise value and preserving employment, contracts, and stakeholder relationships.
Key Stages of a Chapter 11 Case
- - Filing and Automatic Stay – Once filed, an automatic stay halts all creditor collection efforts, lawsuits, and foreclosures, giving the debtor breathing room to plan.
- Debtor-in-Possession (DIP) Control – The debtor remains in control of its assets and business operations, functioning as a “debtor in possession.”
- Plan of Reorganization – The debtor proposes a plan detailing how it will restructure debts, repay creditors, and continue business operations.
- Disclosure Statement and Creditor Voting – Creditors review the plan and vote to approve or reject it.
- Court Confirmation – The bankruptcy court confirms the plan if it meets statutory requirements, allowing the debtor to emerge from Chapter 11.
We guide clients through each of these phases—ensuring compliance with procedural rules, negotiating with stakeholders, and minimizing litigation delays.
2. Chapter 11: Debtors and Restructuring Strategy
Restoring Stability Through Legal and Financial Reorganization
For distressed companies, Chapter 11 is both a shield and a strategy.
It offers protection from creditor actions while enabling management to restructure debt, divest non-core assets, and attract new capital.
Debtor Representation and DIP Financing
Our attorneys assist corporate debtors in:
- - Preparing and filing Chapter 11 petitions and schedules of assets/liabilities.
- Negotiating Debtor-in-Possession (DIP) financing to maintain liquidity during proceedings.
- Restructuring secured and unsecured debt obligations through plan negotiations.
- Selling assets under Section 363 to generate immediate cash flow.
- Communicating with key stakeholders to maintain customer, supplier, and investor confidence.
We focus on developing reorganization plans that balance operational continuity with creditor satisfaction, ensuring that businesses not only survive bankruptcy but position themselves for sustainable recovery.
3. Chapter 11: Creditors and Committees
Maximizing Recovery and Protecting Interests
Creditors are among the most active participants in Chapter 11 proceedings.
From secured lenders to trade creditors, each must navigate a competitive environment to protect repayment rights.
Committee and Creditor Advocacy
We represent:
- - Creditors’ Committees seeking transparency and equitable treatment.
- Secured lenders and indenture trustees in collateral protection and stay relief motions.
- Unsecured creditors negotiating claim prioritization and repayment schedules.
- Bondholders and institutional investors evaluating reorganization plan feasibility.
Our team leverages financial and valuation expertise to identify recovery opportunities and challenge undervalued asset sales or preferential transfers.
We ensure that creditors’ voices are heard—and their recoveries maximized—within the reorganization process.
4. Chapter 11: Asset Sales and Strategic Acquisitions
Turning Distress Into Opportunity
Chapter 11 can also create unique opportunities for investors and competitors to acquire valuable assets at favorable terms.
Under Section 363 of the Bankruptcy Code, debtors can sell assets “free and clear” of liens and claims, subject to court approval.
Representing Purchasers and Stalking Horse Bidders
We represent strategic and financial buyers in acquiring distressed assets or entire businesses through bankruptcy sales.
Our attorneys assist with:
- - Negotiating asset purchase agreements and bidding procedures.
- Conducting due diligence under expedited timelines.
- Managing court approval and closing logistics.
For stalking horse bidders, we secure breakup fees and bidding protections to mitigate transaction risk.
We also advise clients on successor liability, tax implications, and post-closing integration—transforming distressed scenarios into growth opportunities.
5. Chapter 11: Litigation, Claims, and Confirmation
Resolving Disputes and Achieving Confirmation
Chapter 11 often involves litigation over claims, preferences, fraudulent transfers, and plan confirmation.
Our litigation team collaborates closely with restructuring counsel to handle disputes efficiently, preserving estate value.
Bankruptcy Litigation and Claims Resolution
We handle:
- - Adversary proceedings involving preferences and fraudulent conveyance actions.
- Claim objections and estimation hearings.
- Plan confirmation hearings and feasibility challenges.
- Equity holder and insider disputes involving governance or fiduciary breaches.
Our attorneys also pursue mediation and negotiated settlements, balancing speed and cost efficiency while achieving favorable resolutions.
6. Chapter 11: Cross-Border and Industry-Specific Challenges
Navigating Complexities Across Jurisdictions and Sectors
Globalization has transformed bankruptcy into a cross-border process, often involving assets and creditors in multiple jurisdictions.
Our team advises on cases under Chapter 15 (cross-border insolvency) and international protocols under the UNCITRAL Model Law.
Sector Expertise in Complex Industries
We bring industry-specific insight to restructuring cases involving:
- - Aviation – aircraft repossession, lease rejections, and Cape Town Convention filings.
- Energy and Utilities – regulatory compliance, contract assumption, and environmental obligations.
- Healthcare – Medicare/Medicaid funding issues and HIPAA-compliant asset transfers.
- Real Estate and Finance – REIT and CMBS restructurings.
This multidisciplinary approach allows us to anticipate regulatory and operational hurdles that standard bankruptcy counsel might overlook.
7. Why Choose SJKP LLP for Chapter 11 Counsel
Experience, Insight, and Strategic Execution
At SJKP LLP, we approach Chapter 11 representation with both legal precision and commercial foresight.
Our attorneys have guided companies through reorganizations exceeding hundreds of millions of dollars in debt while preserving jobs and operational continuity.
We also represent creditors, trustees, and investors in maximizing recoveries, defending claims, and identifying acquisition opportunities in distressed markets.
Our integrated team of finance, litigation, and regulatory professionals provides holistic solutions—whether the goal is reorganization, sale, or liquidation.
Chapter 11 requires more than legal compliance; it demands vision, timing, and discipline.
SJKP LLP delivers all three—helping clients turn financial distress into sustainable renewal.
The information provided in this article is for general informational purposes only and does not constitute legal advice. Reading or relying on the contents of this article does not create an attorney-client relationship with our firm. For advice regarding your specific situation, please consult a qualified attorney licensed in your jurisdiction.
Certain informational content on this website may utilize technology-assisted drafting tools and is subject to attorney review.
