Can I keep my business open during a liquidating plan in a Chapter 11 bankruptcy?

Yes, business owners may still continue to operate their business during a liquidating plan in a Chapter 11 bankruptcy. Generally, the court will allow the debtor to continue operating while the plan is being developed and implemented. During this time, the court may authorize the debtor to use funds received from customers and other sources to pay business expenses. However, the liquidating plan must contain provisions allowing the debtor to pay creditors according to the terms of the plan. This means that the debtor must prioritize the payment of creditors over any other business expenditure, such as paying wages or other expenses. It is also important to note that the liquidating plan must be approved by the court. In addition, it is important to make sure that the liquidating plan is properly structured and complies with all applicable laws and regulations. This includes making sure that the debtor is not using the bankruptcy process to delay paying creditors or to take advantage of creditors. Finally, it is important to recognize that a liquidating plan in a Chapter 11 bankruptcy is not a permanent solution. As such, the debtor must continue to remain up-to-date with their obligations and adhere to the terms of the liquidating plan. If the debtor fails to do so, the court may decide to terminate the liquidating plan and convert the case to a Chapter 7 bankruptcy.

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