Business Reorganization Under New Subchapter V of Chapter 11

In the “Small Business Reorganization Act”, Congress recently enacted the new Subchapter V  of Chapter 11 business bankruptcy law to make small business reorganization cases

  • quicker
  • cheaper
  • more effective

Quicker Timetable

  • status conference with Bankruptcy Court within 60 of filing
  • debtor report to Bankruptcy Court 14 days prior to status conference outlining plan confirmation efforts
  • plan of reorganization must be filed within 90 days after filing unless extended

Who Qualifies for Subchapter V?

  • $2,725,625 or less noncontingent liquidate debt

  • 50% of more of debt is commercial or business

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Subchapter V Plan

  • must be filed within 90 days of filing of the case unless extended

  • only the debtor can file the plan

  • opportunity to confirm plan with or without agreement of creditors

Simpler Procedures

  • no quarterly US Trustee fees
  • no creditors’ committee unless the Bankruptcy Court orders otherwise
  • no separate disclosure statement
  • assistance of subchapter V trustee
  • more flexible path to plan confirmation