Chapter 11

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DEFINITION of 'Chapter 11'

Named after the U.S. bankruptcy code 11, Chapter 11 is a form of bankruptcy that involves a reorganization of a debtor's business affairs and assets. It is generally filed by corporations which require time to restructure their debts.

Chapter 11 gives the debtor a fresh start, subject to the debtor's fulfillment of its obligations under its plan of reorganization.

INVESTOPEDIA EXPLAINS 'Chapter 11'

A Chapter 11 reorganization is the most complex of all bankruptcy cases and generally the most expensive. It should be considered only after careful analysis and exploration of all other alternatives.
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