New Jersey Chapter 11 Bankruptcy vs. Assignment for the Benefit of Creditors
Like with anything, both chapter 11 bankruptcies and Assignments for the Benefit of Creditors have their advantages and disadvantages. An Assignment for the Benefit of Creditors can be a cost effective way of winding up the business of the Assignor and selling the assets of the Assignor under state court supervision. The buyer of the assets will still have the benefit of a court order stating that he or she is buying the assets free and clear of the debts of the Assignor. The principal of the Assignor is even allowed to buy the assets of the Assignor as long as the court determines that a fair price for the assets was paid. However, if a debtor company is attempting to save its company in its current form, then a reorganization through a chapter 11 bankruptcy is likely the better avenue to take.
Contact a Bankruptcy Lawyer to Discuss Your Options
If you are operating an insolvent business, contact a lawyer so you can be guided accordingly as to what your options are and what option is best for you. The insolvency process can be difficult to navigate, so it is important that you have someone representing you who is familiar with the process to make sure everything goes smoothly.
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