Official Form 425B Disclosure Statement for Small Business Under Chapter 11

Form Official425B is a United States Bankruptcy Court form also known as the "Disclosure Statement For Small Business Under Chapter 11". The latest edition of the form was released in December 1, 2017 and is available for digital filing.

Download an up-to-date Form Official425B in PDF-format down below or look it up on the United States Bankruptcy Court Forms website.

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Fill in this information to identify the case:
Debtor Name __________________________________________________________________
_______________________
__________
United States Bankruptcy Court for the:
District of
(State)
Case number: _________________________
Check if this is an amended filing
Official Form 425B
Disclosure Statement for Small Business Under Chapter 11
12/17
[
]’s Disclosure Statement, Dated [
]
Name of Proponent
Insert Date
Table of Contents. See instructions about how to modify the table of contents if you do not have all of the sections below.
[Insert when text is finalized]
I. Introduction ................................................................................................................................................... 3
A. Purpose of This Document ....................................................................................................................................... 3
B. Deadlines for Voting and Objecting; Date of Plan Confirmation Hearing ................................................................... 3
C. Disclaimer ................................................................................................................................................................ 4
II. Background ................................................................................................................................................. 4
A. Description and History of the Debtor’s Business ..................................................................................................... 4
B. Insiders of the Debtor ............................................................................................................................................... 4
C. Management of the Debtor During the Bankruptcy ................................................................................................... 4
D. Events Leading to Chapter 11 Filing ......................................................................................................................... 4
E. Significant Events During the Bankruptcy Case ........................................................................................................ 5
F. Projected Recovery of Avoidable Transfers .............................................................................................................. 5
G. Claims Objections .................................................................................................................................................... 5
H. Current and Historical Financial Conditions .............................................................................................................. 6
III. Summary of the Plan of Reorganization and Treatment of Claims and Equity Interests ............................ 6
A. What Is the Purpose of the Plan of Reorganization? ................................................................................................. 6
B. Unclassified Claims .................................................................................................................................................. 6
1. Administrative expenses, involuntary gap claims, and quarterly and Court fees .................................................... 6
2. Priority tax claims .................................................................................................................................................. 7
C. Classes of Claims and Equity Interests..................................................................................................................... 7
1. Classes of secured claims .................................................................................................................................... 7
2. Classes of priority unsecured claims ..................................................................................................................... 8
3. Classes of general unsecured claims .................................................................................................................... 9
4. Classes of equity interest holders ....................................................................................................................... 10
D. Means of Implementing the Plan ............................................................................................................................ 10
1. Source of payments ............................................................................................................................................ 10
2. Post-confirmation Management .......................................................................................................................... 10
E. Risk Factors ........................................................................................................................................................... 10
F. Executory Contracts and Unexpired Leases ........................................................................................................... 11
G. Tax Consequences of Plan .................................................................................................................................... 11
IV. Confirmation Requirements and Procedures ........................................................................................... 12
A. Who May Vote or Object......................................................................................................................................... 12
1. What is an allowed claim or an allowed equity interest? ...................................................................................... 12
2. What is an impaired claim or impaired equity interest? ........................................................................................ 12
3. Who is not entitled to vote ................................................................................................................................... 13
4. Who can vote in more than one class ................................................................................................................. 13
B. Votes Necessary to Confirm the Plan ..................................................................................................................... 13
1. Votes necessary for a class to accept the plan ................................................................................................... 13
page 1
Official Form 425B
Disclosure Statement for Small Business Under Chapter 11
Fill in this information to identify the case:
Debtor Name __________________________________________________________________
_______________________
__________
United States Bankruptcy Court for the:
District of
(State)
Case number: _________________________
Check if this is an amended filing
Official Form 425B
Disclosure Statement for Small Business Under Chapter 11
12/17
[
]’s Disclosure Statement, Dated [
]
Name of Proponent
Insert Date
Table of Contents. See instructions about how to modify the table of contents if you do not have all of the sections below.
[Insert when text is finalized]
I. Introduction ................................................................................................................................................... 3
A. Purpose of This Document ....................................................................................................................................... 3
B. Deadlines for Voting and Objecting; Date of Plan Confirmation Hearing ................................................................... 3
C. Disclaimer ................................................................................................................................................................ 4
II. Background ................................................................................................................................................. 4
A. Description and History of the Debtor’s Business ..................................................................................................... 4
B. Insiders of the Debtor ............................................................................................................................................... 4
C. Management of the Debtor During the Bankruptcy ................................................................................................... 4
D. Events Leading to Chapter 11 Filing ......................................................................................................................... 4
E. Significant Events During the Bankruptcy Case ........................................................................................................ 5
F. Projected Recovery of Avoidable Transfers .............................................................................................................. 5
G. Claims Objections .................................................................................................................................................... 5
H. Current and Historical Financial Conditions .............................................................................................................. 6
III. Summary of the Plan of Reorganization and Treatment of Claims and Equity Interests ............................ 6
A. What Is the Purpose of the Plan of Reorganization? ................................................................................................. 6
B. Unclassified Claims .................................................................................................................................................. 6
1. Administrative expenses, involuntary gap claims, and quarterly and Court fees .................................................... 6
2. Priority tax claims .................................................................................................................................................. 7
C. Classes of Claims and Equity Interests..................................................................................................................... 7
1. Classes of secured claims .................................................................................................................................... 7
2. Classes of priority unsecured claims ..................................................................................................................... 8
3. Classes of general unsecured claims .................................................................................................................... 9
4. Classes of equity interest holders ....................................................................................................................... 10
D. Means of Implementing the Plan ............................................................................................................................ 10
1. Source of payments ............................................................................................................................................ 10
2. Post-confirmation Management .......................................................................................................................... 10
E. Risk Factors ........................................................................................................................................................... 10
F. Executory Contracts and Unexpired Leases ........................................................................................................... 11
G. Tax Consequences of Plan .................................................................................................................................... 11
IV. Confirmation Requirements and Procedures ........................................................................................... 12
A. Who May Vote or Object......................................................................................................................................... 12
1. What is an allowed claim or an allowed equity interest? ...................................................................................... 12
2. What is an impaired claim or impaired equity interest? ........................................................................................ 12
3. Who is not entitled to vote ................................................................................................................................... 13
4. Who can vote in more than one class ................................................................................................................. 13
B. Votes Necessary to Confirm the Plan ..................................................................................................................... 13
1. Votes necessary for a class to accept the plan ................................................................................................... 13
page 1
Official Form 425B
Disclosure Statement for Small Business Under Chapter 11
Debtor Name
_______________________________________________________
Case number_____________________________________
2. Treatment of non-accepting classes of secured claims, general unsecured claims, and interests ...................... 13
C. Liquidation Analysis ................................................................................................................................................ 14
D. Feasibility ............................................................................................................................................................... 14
1. Ability to initially fund plan ................................................................................................................................... 14
2. Ability to make future plan payments and operate without further reorganization ................................................ 14
V. Effect of Confirmation of Plan.................................................................................................................... 15
A.Discharge of Debtor................................................................................................................................................. 15
B. Modification of Plan ................................................................................................................................................ 15
C. Final Decree ........................................................................................................................................................... 16
VI. Other Plan Provisions .............................................................................................................................. 16
Exhibit A: Copy of Proposed Plan of Reorganization .................................................................................................. 17
Exhibit B: Identity and Value of Material Assets of Debtor ........................................................................................... 18
Exhibit C: Prepetition Financial Statements ................................................................................................................. 19
Exhibit D: [Most Recently Filed Postpetition Operating Report] ................................................................................... 20
Exhibit E: Liquidation Analysis .................................................................................................................................... 21
Exhibit F: Cash on hand on the effective date of the Plan ........................................................................................... 22
Exhibit G: Projections of Cash Flow for Post-Confirmation Period ............................................................................... 23
page 2
Official Form 425B
Disclosure Statement for Small Business Under Chapter 11
Debtor Name
_______________________________________________________
Case number_____________________________________
I. Introduction
This is the disclosure statement (the Disclosure Statement) in the small business chapter 11 case of
_____________ (the Debtor). This Disclosure Statement provides information about the Debtor and
the Plan filed on [
] (the Plan) to help you decide how to vote.
insert date
A copy of the Plan is attached as Exhibit A. Your rights may be affected. You should read the
Plan and this Disclosure Statement carefully. You may wish to consult an attorney about your rights
and your treatment under the Plan.
The proposed distributions under the Plan are discussed at pages __-__ of this Disclosure
Statement. [
__,
___
General unsecured creditors are classified in Class
and will receive a distribution of
% of their
_________.]
allowed claims, to be distributed as follows
A. Purpose of This Document
This Disclosure Statement describes:
The Debtor and significant events during the bankruptcy case,
How the Plan proposes to treat claims or equity interests of the type you hold (i.e., what
you will receive on your claim or equity interest if the plan is confirmed),
Who can vote on or object to the Plan,
What factors the Bankruptcy Court (the Court) will consider when deciding whether to
confirm the Plan,
Why [
] believes the Plan is feasible, and how the treatment of your claim or
the proponent
equity interest under the Plan compares to what you would receive on your claim or
equity interest in liquidation, and
The effect of confirmation of the Plan.
Be sure to read the Plan as well as the Disclosure Statement. This Disclosure Statement
describes the Plan, but it is the Plan itself that will, if confirmed, establish your rights.
B. Deadlines for Voting and Objecting; Date of Plan Confirmation Hearing
The Court has not yet confirmed the Plan described in this Disclosure Statement. A separate
order has been entered setting the following information:
Time and place of the hearing to [finally approve this disclosure statement and] confirm the
plan,
Deadline for voting to accept or reject the plan, and
Deadline for objecting to the [
] confirmation of the plan.
adequacy of disclosure and
If you want additional information about the Plan or the voting procedure, you should contact
[
].
insert name and address of representative of plan proponent
page 3
Official Form 425B
Disclosure Statement for Small Business Under Chapter 11
Debtor Name
_______________________________________________________
Case number_____________________________________
C. Disclaimer
The Court has [conditionally] approved this Disclosure Statement as containing adequate information to enable
parties affected by the Plan to make an informed judgment about its terms. The Court has not yet determined
whether the Plan meets the legal requirements for confirmation, and the fact that the Court has approved this
Disclosure Statement does not constitute an endorsement of the Plan by the Court, or a recommendation that it
be accepted.
II. Background
A. Description and History of the Debtor’s Business
The Debtor is a [
]. Since [
], the Debtor has
corporation, partnership, etc.
insert year operations commenced
been in the business of __________________________________________. [
Describe the Debtor’s
].
business
B. Insiders of the Debtor
[
Insert a detailed list of the names of Debtor’s insiders as defined in § 101(31) of the United States Bankruptcy Code
(the Code) and their relationship to the Debtor.
For each insider, list all compensation paid by the Debtor or its affiliates to that person or entity during the 2 years prior to
the commencement of the Debtor’s bankruptcy case, as well as compensation paid during the pendency of this chapter
11 case.]
C. Management of the Debtor During the Bankruptcy
List the name and position of all current officers, directors, managing members, or other persons
in control (collectively the Management) who will not have a position post-confirmation that you
list in III D 2.
Name
Position
D. Events Leading to Chapter 11 Filing
[
.]
Describe the events that led to the commencement of the Debtor’s bankruptcy case
page 4
Official Form 425B
Disclosure Statement for Small Business Under Chapter 11
Debtor Name
_______________________________________________________
Case number_____________________________________
E. Significant Events During the Bankruptcy Case
[Describe significant events during the Debtor’s bankruptcy case:
Describe any asset sales outside the ordinary course of business, Debtor in Possession financing, or cash collateral
orders.
Identify the professionals approved by the court.
Describe any adversary proceedings that have been filed or other significant litigation that has occurred (including
contested claim disallowance proceedings), and any other significant legal or administrative proceedings that are
pending or have been pending during the case in a forum other than the Court.
Describe any steps taken to improve operations and profitability of the Debtor.
Describe other events as appropriate.]
F. Projected Recovery of Avoidable Transfers
Check one box.
The Debtor does not intend to pursue preference, fraudulent conveyance, or
other avoidance actions.
The Debtor estimates that up to $____________ may be realized from the
recovery of fraudulent, preferential or other avoidable transfers. While the
results of litigation cannot be predicted with certainty and it is possible that
other causes of action may be identified, the following is a summary of the
preference, fraudulent conveyance and other avoidance actions filed or
expected to be filed in this case:
Transaction
Defendant
Amount Claimed
The Debtor has not yet completed its investigation with regard to prepetition
transactions. If you received a payment or other transfer within 90 days of the
bankruptcy, or other transfer avoidable under the Code, the Debtor may seek
to avoid such transfer.
G. Claims Objections
Except to the extent that a claim is already allowed pursuant to a final non-appealable order, the
Debtor reserves the right to object to claims. Therefore, even if your claim is allowed for voting
purposes, you may not be entitled to a distribution if an objection to your claim is later upheld.
Disputed claims are treated in Article 5 of the Plan.
page 5
Official Form 425B
Disclosure Statement for Small Business Under Chapter 11

Download Official Form 425B Disclosure Statement for Small Business Under Chapter 11

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