Helpful Hints Library

Petition Date

File Chapter 11 Petition

At least 24 hours after petition is filed

First Day Hearing (on motions filed by debtor regarding operations of debtor)

Usually within 14 days of Petition Date

Formation of Creditors Committee (usually debtor’s 20 largest creditors)

Approx 30 days from Petition Date

Filing of Debtors’ Schedules & Statement of Financial Affairs

Within 60 days of Petition Date

Meeting of Creditors

Usually between 45 – 60 days from Petition Date

Bar Date – deadline for filing claims

Within 120 days of Petition Date

Debtor files Plan of Reorganization and Disclosure Statement ("DS") – once bankruptcy court approves DS, the DS & Plan are sent out to creditors for voting

If vote is successful, bankruptcy court confirms the Plan of Reorganization

After Confirmation

Distribution to creditors under Plan provisions

Administrative Claim

Claims for costs & expenses of administration of Debtor’s business
(professional fees; US Trustee fees; reclamation claims, etc.)

Allowed Claim

A claim that is accepted as owing by the Debtor either because it has not been objected to or has been upheld by the court following a hearing on an objection to the claim.  A claim that is not disputed, contingent or unliquidated

Basis for Claim

1. Good sold
2. Services performed
3. Money loaned
4. Personal injury/wrongful death
5. Taxes
6. Retiree benefits
7. Wages, salaries and compensation
   
   

Contingent Claim

A claim in which the debtor's potential liability has been created by contract or wrongful or negligent act, but actual liability will only arise upon the happening of a future event that may not occur

Creditor

Any entity that has a claim against the Debtor that arose at the time of or before the filing of the bankruptcy petition.  In certain circumstances as set forth in the bankruptcy code, a creditor's claim may arise after the filing of the debtor's bankruptcy petition.

Creditors' Committee

A committee of creditors appointed by the U.S. Trustee in Chapter 11 cases, and sometimes in Chapter 7 cases, to represent the interests of the creditor body as a whole or, if more than one committee is appropriate, a class of creditors.

Creditors' Meeting (first meeting of creditors, 341 hearing)

The statutory meeting of creditors required in all bankruptcy cases by section 341 of the bankruptcy code.  The meeting must be convened by the U.S. Trustee within a prescribed time following the filing of the bankruptcy petition.  Its primary purpose is the examination of the debtor

Cure Amount Claim

Claim based on debtor’s defaults pursuant to an Executory Contract or unexpired lease at the time such contract or lease is assumed by Debtor

DIP Financing

Financing provided by lender during bankruptcy

Discharge

The debtor's release from liability for the unpaid balance of all debts that are provable in bankruptcy and that are not excluded from discharge under the Code

Disputed Claim

1. claim where no POC is filed by Bar Date
2. claim that is listed as disputed, contingent or unliquidated on Debtor’s Schedules
   
   

Equity Claim

Legal, equitable or contractual claim arising from stock ownership (including options, warrants, convertible security, etc.)

Executory Contract

A contractual relationship in which the obligations of both parties are so far unperformed that the failure of either to complete performance would be a material breach.  Upon the bankruptcy of one of the parties to such a contract, his or her trustee must elect to either reject or assume the contract.

Exempt

Property that is exempt is removed from the bankruptcy estate and is not available to pay the claims of creditors.  The debtor selects the property to be exempted from the statutory lists of exemptions available under the law of his state.  The debtor gets to keep exempt property for use in making a fresh start after bankruptcy

Impaired

Where the rights or interests of a creditor or class of creditors are altered such that the claim or interest is reduced so that the creditor or class receives less that 100 % of their claim

Liquidated

A debt that is for a known number of dollars is liquidated. 

Objection

 A written response to challenge assertions by another party such as a claim, a claim of exemption, a proposed plan, or the discharge of a debt.

Petition Date

Date Debtor files Chapter 11

Priority Claim
Priority Tax Claim

Claims for lost wages, deposits, taxes

Proof of Claim

A creditor's formal submission of a claim against the estate

Schedules

1. Real Property
2. Personal Property
3. Property Claimed as Exempt
4. Secured Creditors
5. Unsecured Priority
6. Unsecured, Non-priority
7. Executory Contracts
8. Co-debtors
9. Current Income of Individual Debtors
10. Current Expenditures of Individual Debtors
    
    

Secured Claim

Debt secured by property of Debtor (mortgages, security interests, trust deeds, tax liens) – collateral may include real estate, motor vehicles, etc.

Unliquidated

An unliquidated debt is one where the debtor has liability, but the exact monetary measure of that liability is unknown.  Tort claims are usually unliquidated until a trial fixes the amount of the liability.

Unsecured Claim

Any claim that is not an Administrative, Cure Amount, Equity, Priority, Priority Tax, Secured, or Intercompany claim

Unsecured Priority Claim

1. Wages, salaries or commissions (up to $4925) earned within 90 days before filing of Petition 507(a)(3)
2. Contributions to employee benefit plan (507(a)(4)
3. Up to 2,225 of deposits toward purchase, lease, or rental of property or services for personal, family, or household use 507(a)(6)
4. Taxes or penalties owed to governmental units 507(a)(8)