In these new and troubling times, we at Furr and Cohen, P.A. extend our sincerest best wishes to you and your families and hope that you are all, first and foremost, well and safe.
We are all know of the horrific impact COVID -19 is having on our economy. Accordingly, we want to make you aware of the possible benefits of the new Small Business Reorganization Act (“SBRA”), which went into effect in February 2020. In its most basic terms, it enables a business (Corporation, LLC or Individual) with secured and unsecured debt totaling $7,500,000.00* (updated 4/1/2020) to benefit from a streamlined chapter 11 process with significantly reduced legal fees and administrative fees.
(*Updated – Congress just passed an increase of the debt threshold for small businesses to $7,500,000.00 instead of the $2,725,625.00.) – update 4/1/2020
By utilizing the SBRA, it is much easier to confirm a plan and keep your assets. Mortgages may be modified, and creditors do not vote. The debtor has the exclusive right to file a plan, which can be up to five years. Although a trustee is appointed, the trustee does not control the business operations. The trustee’s role is to oversee the viability of the business and comment on the plan and assist the debtor with its negotiations with the creditors.
Our attorneys have over 100 years of aggregate experience in successfully handling chapter 11 bankruptcies. We are well-versed in this new law and are available to help you through this difficult time.