How Business Bankruptcy Works

This article from Howstuffworks provides an easily understandable overview of business bankruptcy stating:

"Bankruptcy is one of the most complex areas of law, incorporating elements of contract law, corporate law, tax law and real estate law. In recent years, several high-profile corporations like Enron, WorldCom and Adelphia have filed for bankruptcy. Although businesses only accounted for about 2 percent of all bankruptcy filings in the United States last year, commercial bankruptcies can have a big impact on the economy because there can be a lot of money at stake.

In this article, we'll explain the different types of bankruptcy filings under United States law, figure out who pays what to whom, and describe the process of reorganizing a company and running it under bankruptcy."