In a Chapter 11 bankruptcy, the individual or business filing bankruptcy (debtor) has the first opportunity to propose a reorganization plan—to reorganize the debtor’s operations and payment of debts. A Chapter 11 plan is an agreement between the debtor and its creditors as to how the debtor will operate and pay its debts going forward.

Chapter 11 plans often include downsizing of the debtor’s operations to reduce expenses, and renegotiation of debts. If the proposed reorganization plan is accepted by the court and the creditors, the bankruptcy process moves forward.

In Washington state, as in all states, Chapter 11 bankruptcy is governed by federal law under the United States Bankruptcy Code. When an individual or business files for Chapter 11 bankruptcy, the debtor is given the initial opportunity to propose a reorganization plan. This plan outlines how the debtor intends to continue operations and manage debt repayment. The reorganization often involves downsizing to cut costs and may include renegotiating debts with creditors. The debtor's plan must be presented to the court and creditors for approval. If the court and the required majority of creditors accept the plan, the debtor can proceed with the reorganization under the terms of the plan. The goal of Chapter 11 is to allow the debtor to restructure finances and emerge from bankruptcy as a viable entity. It's important to note that while the process is governed by federal law, local rules and the specific practices of the bankruptcy court in Washington can also affect the proceedings.