Chapter 11 bankruptcy is common among struggling businesses. The goal is to restructure debts and reorganize finances so the business can stay in operation. Unlike Chapter 7 bankruptcy, Chapter 11 allows a business to keep many of its assets instead of totally liquidating.

This week, it was announced that the well-known photography company Kodak is getting ready to file for Chapter 11 bankruptcy protection. The company is reportedly hoping to avoid bankruptcy by selling off its collection of digital-imaging patents, which could bring in between $2 million to $3 billion, analysts say.

Kodak is a 131-year-old household name that has grown synonymous with creating memories through photographs. The brand even inspired the phrase "a Kodak moment," as a way to describe a fond memory. Even so, like many brands of today, Kodak has not been able to keep up with the changing technology.

After coming out with the first digital camera in 1975, experts say that the company did not do enough to keep itself current during the ever-evolving digital revolution. As one brand strategist said, Kodak has been "in the thrall of its own brand."

Of course, many companies that file Chapter 11 end up turning things around and becoming profitable once again. However, it can be a long and complicated process, which is why experienced bankruptcy attorneys are a must.

The process begins with creating a plan in which the company proposes a way to pay back its debts. Its creditors may also propose a plan. The creditors are given the final say as to what plan is adopted, and the process is overseen in bankruptcy court.

Hopefully, Chapter 11 is successful in this case and there are many more Kodak moments to come.

Source: The Washington Post, "Kodak bankruptcy: Photographers mourn," Maura Judkis, Jan. 5, 2012