Yesterday General Motors announced second-quarter profits that exceeded expectations and came as G.M. was putting the finishing touches on an initial public stock offering. This is good news from a company forced into Chapter 11 bankruptcy a little more than a year ago. According to Dow Jones Daily Bankruptcy Review, "After recent years of financial distress and bankruptcy filings, … [Read more...]
Chapter 11 May Help Small Businesses Weather Downturn
July 22, 2010 By
Since a good percentage of our bankruptcy clients are small business owners, I keep an eye out for articles on financing. This article from Christian Science Monitor caught my eye because of the contradictory messages about small business lending. While the federal reserve system is "encouraging" banks to lend to small businesses, banks counter that small businesses simply aren't asking for … [Read more...]
Start a Business NOW?
June 29, 2010 By
With so many people un- or under-employed it's no wonder people who have always wanted to work for themselves are considering doing so now. As bankruptcy lawyers, my partner and I perhaps have a skewed view of the landscape so here's a good list of questions to ask yourself before venturing out, courtesy of Inc. magazine. Dipping into the 401-k? With bank financing so difficult to obtain, … [Read more...]
Personal Loan Guarantees for Business
June 24, 2010 By
After forty years of helping small business owners with their financial difficulties, I wish more of them understood how the personal guarantee can send them into bankruptcy. It's difficult for self-employed people and small business owners to get capital, and the lack of capital is a big part of the reason business owners file for bankruptcy when their businesses stumble or fall -- a vicious … [Read more...]
Creditor Protection Without Bankruptcy
March 16, 2010 By
With so many people unwinding unprofitable businesses and adjusting their lifestyles after financial hardship, many are confused about assets a creditor can seize and if bankruptcy is the only way to protect themselves from the proverbial wolves at the door. While we offer general information here, it is not comprehensive and not intended as legal advice. Exempt property: hands off, … [Read more...]
Chapter 13 Bankruptcy: Individuals
March 1, 2010 By
Chapter 13 is a repayment bankruptcy. It is utilized by individuals, and owners of sole proprietorships or other “mom and pop” businesses, not only to obtain a fresh start, but also to retain their assets and reorganize their financial affairs. For most individuals with debt problems, the major decision is whether to file for protection under Chapter 7 or Chapter 13 of the Bankruptcy … [Read more...]
Chapter 11 Bankruptcy: Businesses and Individuals
February 24, 2010 By
Chapter 11 bankruptcy is a reorganization. More businesses than individuals file for Chapter 11; it is an orderly process that allows the debtor time and space to reorganize its financial affairs and repay its creditors some or all of the debt owed. It is a vehicle through which debtors can reject or cancel certain leases, contracts, and other debt obligations, and get breathing room to obtain … [Read more...]
Chapter 7 Bankruptcy: Businesses & Individuals
February 22, 2010 By
The word"bankruptcy" is heard everywhere, from coffee shops to church bazaars and the evening news. It's clear to me that, despite this general knowledge of bankruptcy, few people understand what it means to file for protection under Chapter 7, Chapter 11 or Chapter 13. Chapter 7 is a liquidating bankruptcy. It is normally utilized to obtain a “fresh start” for an individual … [Read more...]
Epicentre Contractors Turn to Bankruptcy
February 17, 2010 By
Contracting has always been a tough business. Subcontractors often make payroll and provide supplies and labor to a project months before they are paid by the general contractor or owner. In the case of Charlotte's Epicentre, a stop work order strangled cash flow for both the developer and the contractors. We're still seeing clients whose financial difficulties began there and … [Read more...]
Failure Can Teach Success
December 22, 2009 By
The Kauffman Foundation just published a study of 549 company founders of successful businesses in high-growth industries. I zeroed in on this finding: "40 percent cited lessons learned from failures as extremely important – the second-highest “extremely important” rating." Lessons from forty years in bankruptcy court After forty years of practicing law I can validate Kauffman's … [Read more...]