Definition of Chapter 10

Chapter 10 of the US Bankruptcy Reform Act allows a business to reorganise under a court-appointed independent manager. [1]

Chapter 10 allows small companies with financial problems to request court protection while a workable plan is devised to alleviate the situation. To qualify for protection under Chapter 10, a given company must fully disclose its current position to the court for review. In addition, the company must also be willing to develop a debt repayment schedule that will allow for orderly restitution of the outstanding debt. [2]

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