What is a “liquidating trustee” in a Chapter 11 bankruptcy?

A liquidating trustee in a Chapter 11 bankruptcy is an independent professional appointed by the court to oversee the liquidation of assets of the company. The liquidation process includes taking control of the assets of the business, examining and evaluating each asset, determining how they will be sold, assembling bids from potential buyers, negotiating purchase agreements, and following the court’s orders to complete the liquidation process. In addition to managing the liquidation process, the liquidating trustee is also responsible for the distribution of the proceeds from the sale of assets to creditors and other stakeholders in the bankruptcy case. The liquidating trustee is responsible for ensuring that all assets are sold in an orderly fashion so that a fair and equitable distribution can be made to all stakeholders. The trustee is also responsible for ensuring that all creditors have been notified of the bankruptcy proceeding and that all creditors receive the appropriate share of funds from the estate. The liquidating trustee will also be responsible for making sure that all legal requirements have been met, such as filing various documents with the court, as well as for working with the creditors and other stakeholders to ensure that they receive their share of the proceeds from the sale of assets.

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What is a “liquidating trustee” in a Chapter 11 bankruptcy?

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