Category Archives: Bankruptcy

More than 300 retailers have filed for bankruptcy so far this year, according to data from BankruptcyData.com. That's up 31% from the same time last year. Most of those filings were for small companies -- the proverbial Mom & Pop store with a single location. But there are also plenty of household names on the list.

Most of these stores are suffering from the same thing: A shift away from traditional storefronts to online shopping.

Not all of these chains will eventually go out of business. Most of them fled for Chapter 11, which allows a company to keep operating while it restructures its debt. But the sector is already on course for a record number of store closings this year.

Here's a list of some of the more prominent retail bankruptcies to date.

Gymboree: The children's clothing retailer filed for bankruptcy on June 11, saying it may close 375 of its 1,300 stores under the Gymboree, Crazy 8 and Janie and Jack brands.

rue21: The teen clothing retailer filed for bankruptcy on May 15, and said it has plans to close about one third of its 1,200 stores.

Payless ShoeSource: The discount shoe retailer filed on April 4. It said it would move to close nearly 400 U.S. stores out of the 4,400 locations it has worldwide.

Gordmans Stores: A century-old regional department store chain, Gordmans had 106 stores in 22 states in the Midwest and western U.S. It filed for bankruptcy on March 13 and is shuttering all of its stores.

Gander Mountain: The hunting and outdoors retailer, which operated under the Gander Mountain and Overton names, filed for bankruptcy.

The RV retailer Camping World bought some of the company's assets at auction in April and will keep some stores open. Its remaining inventory will be sold through liquidation sales.

RadioShack: The iconic electronics retailer first filed for bankruptcy in 2015, and tried to stay in business through a deal with Sprint in which the wireless provider operated stores within the RadioShack stores. But in March the company that now owns RadioShack filed for bankruptcy once again, putting it on the path to close its remaining stores.

hhgregg: The appliance, electronics and furniture retailer filed for bankruptcy in March and has closed all of its 132 stores.

Wet Seal: The troubled teen clothing retailer, which made a previous trip through bankruptcy in 2015, filed for bankruptcy again in February. This time it went out of business, closing 171 stores and putting 1,750 employees out of work.

The Limited: The once popular women's clothing chain filed for bankruptcy in January and closed all of its remaining stores.

CNNMoney (New York) First published June 13, 2017: 12:05 AM ET

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Retail bloodbath: Bankruptcy filings pile up - CNNMoney

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RBI, Banks And NPAs - First, Reform India's Bankruptcy Code, Then Force Defaulters Into It Forbes It has to be said that Arun Jaitley and Narendra Modi are doing many of the right things in their management of the Indian economy. No, this is not to make a party political point and it's most certainly not to say that they're doing everything right ... India says banks must start bankruptcy proceedings against 12 major defaultersNasdaq RBI identifies 12 accounts with 25% of bank bad loans for bankruptcy proceedingsHindustan Times RBI Pushes 12 Biggest Defaulters Into Bankruptcy Proceedings. Here's All You Need To Know.Huffington Post India Scroll.in all 17 news articles »

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RBI, Banks And NPAs - First, Reform India's Bankruptcy Code, Then Force Defaulters Into It - Forbes

Hartford Mayor Luke Bronin and his budget director, Melissa McCaw, met Tuesday with members of the MetroHartford Alliance, warning again that bankruptcy is possible unless state legislators approve additional funds for the city.

"What happens if we don't get it? I don't think there's a responsible solution that we have, and that's why I have not, and will not, take bankruptcy off the table," Bronin said.

MetroHartford President Oz Griebel commended the mayor for restoring "structure" to the city's budget, and for providing a foundation for the city to debate its return to fiscal health. City leaders met with the business group to discuss Hartford's fiscal problems, including a projected deficit of $49.6 million.

Hartford approved a $612.9 million spending plan in late May, but the budget's uncertainty will continue until Connecticut approves its state plan and decides how much money to give Hartford. The city is expected to get $258.4 million, but city officials are counting on an additional $40 million from the state.

State legislators and the governor who have been unable to agree on a strategy for overcoming the state's projected $5 billion budget deficit have yet to respond to Hartford's request for additional state assistance.

The mayor identified the city's lack of taxable property as the root cause of its fiscal trouble, and repeated his assertion that Hartford does not have an independent path back to solvency. It must get support from the state and its regional neighbors, he said.

Alliance members expressed frustration that surrounding communities have been reluctant to help the city, and skepticism that the state would come through. Bronin empathized with their position as well.

"What we're asking legislators to do is to vote for a budget that cuts their own town, in some cases pretty significantly, to give the city of Hartford [more money]," Bronin said. "That's a tough case to make, even if I think it's the right thing to do."

Bronin said he has tried to speak with as many stakeholders as possible in discussing the budget, and that the conversation must remain focused on a long-term solution.

"Where we are now is exactly where we said we would be a year ago," Bronin said. "If we can solve for this year, and can solve it in a way that's built on a new relationship with the state of Connecticut, then we have some room where we're not in the same position next year."

Bronin clarified after the meeting that a solution wouldn't rely only on state aid: It would include labor savings, and the city would still have to prepare for a large debt payment spike set to arrive in three years.

Hartford's budget problems won't end with a bailout this year, Bronin said. A long-term solution for Hartford will require additional state aid in coming years as well, he said.

"Success is not getting the legislature to say, 'OK, we'll keep you alive for another year,'" Bronin said.

The mayor displayed the city's projections for future deficits, which are expected to remain stable at around $50 million for the next three years before spiking even further. The city is projecting the deficit will rise to $83.2 million in fiscal year 2023.

One audience member stood up to ask Bronin the last question of the meeting: Is he optimistic the state will grant the additional aid?

"We have to wait and see," he said.

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Bronin Warns Business Leaders That Bankruptcy May Happen Without Additional State Aid - Hartford Courant

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Italy's Alitalia Airline Files for Bankruptcy in the US Wall Street Journal (subscription) Italy's Alitalia SpA airline filed for bankruptcy Monday in the U.S., faced with the threat of losing access to New York's John F. Kennedy International Airport over unpaid bills. Alitalia, which is working to find a buyer, sought chapter 15 protection ...

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Italy's Alitalia Airline Files for Bankruptcy in the US - Wall Street Journal (subscription)

MARQUETTE, Mich. (WLUC) - An Ishpeming business owner is charged with bankruptcy fraud and concealing assets in bankruptcy. The charges against David Louis Vernier were filed in federal court last month, less than three months after his daughter was sentenced for conspiring to defraud financial institutions.

The Verniers were associated with Oasis Fuels Inc., which was supplying fuel to several gas stations in the Upper Peninsula until several months ago.

Brooke Ferns, also known as Brooke Vernier, was sentenced on Feb. 13 to serve 18 months in prison with two years of supervised release.

Federal investigators said Brooke Vernier used a circular check kiting scheme. It gave the appearance the accounts had more money in them than they actually did. The checks were written on the Oasis Fuels Inc. checking account.

Davids charges are similar to his daughter's. He is accused of having devised and intending to devise a scheme and artifice to defraud one or more of his creditors by concealing his income and his property. He filed a voluntary petition for bankruptcy under Title 11 that included false and fraudulent statements and material omissions regarding his income and property.

The felonies are punishable up to five years in prison and/or $250,000 fine or not more than the greater of twice the gross gain or twice the gross loss.

David has been arraigned. He is scheduled for an initial pretrial conference in U.S. District Court in Marquette on June 27.

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David Vernier charged with Bankruptcy Fraud - UpperMichigansSource.com

Cowboy-themed restaurant Square 1 Burgers and Bar filed for reorganization bankruptcy for all its locations, including the recently closed spot in Winter Park.

Tampa-based Square 1, known for its buffalo burgers and cow-print decor, filed 12 separate bankruptcy petitions in U.S. Bankruptcy Court for the Middle District of Florida Friday, including its parent company, a property company and two recently closed locations.

In its bankruptcy filing, Square 1 blamed the financial troubles on an over-saturated restaurant market.

Unfortunately, between 2014 and 2016, a number of restaurant franchises flooded the market saturating the areas around Square Ones restaurant with a litany of dining options, court documents said. When the competition settled in, Square One struggled to breakeven and quickly fell behind with its creditors.

Square 1 closed in Winter Park in May after being ordered to leave after allegedly owing about $21,000 in back rent, according to court documents.

Winter Park landlord Andre Raab said the burger restaurant left in the dark of night.

Square 1 also recently closed a location in Sarasota, according to the Sarasota Herald-Tribune.

Square 1 Burgers kicked out of Winter Park restaurant space

Square 1 has eight locations left and the company filed for bankruptcy on all eight individually.

For the Winter Park bankruptcy, Square 1 listed assets of $1 to $10 million and debts of $1 to $10 million. The itemized list of liabilities adds up to about $70,000, but most of the money is owed to the landlord, food provider Sysco and meat company Master Purveyors in Tampa.

A representative for Square 1 Burgers did not return a phone call or email Monday afternoon. The company s lawyer, Scott Shuker, said there are separate filings because each restaurant is an individual limited liability corporation.

Square 1 was founded by Tampa restaurateur Bill Shumate and partner Joanie Corneil, along with Ray Leich. Schumate and Corneil also own Bellas Italian Cafe in Tampas Hyde Park.

Got a news tip? karnold@orlandosentinel.com or 407-420-5664; Twitter, @kylelarnold or facebook.com/bykylearnold

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Square 1 Burgers files bankruptcy, blames over-saturated restaurant market - Orlando Sentinel

It's only Monday, and the retail sector has already seen a rough start to the week.

Gymboree's filing for Chapter 11 bankruptcy protection has many retail industry watchers wondering who's next. With the record pace of bankruptcies in the industry this year, bankruptcy, for some, is becoming an issue of when the company will file, not if they will.

So far this year, specialty retailers Rue21 and Payless Shoesource are among those contributing to the rising default rate in the sector, Fitch explained.

In a research note Monday, Fitch highlighted its so-called loans of concern list, which includes: Sears Holdings, Claire's Stores, Nine West Holdings, 99 Cent Stores, J. Crew, True Religion Apparel, Charlotte Russe, Charming Charlie, NYDJ Apparels and Vince.

Retailers on the list are considered to have a significant risk of default within the next 12 months.

Taking a look at Fitch's latest list, "a number of these names have been at the forefront of past restructurings," Joshua Friedman, a legal analyst for Debtwire, told CNBC in an interview.

"Struggling retailers need to look at near-term triggers, such as debt that's maturing, interest expense and interest payments coming due," he went on.

High debt leverage and weak operating trends are what drove Gymboree's filing specifically, Fitch said in a statement Monday.

In conjunction with its latest filing with the Securities and Exchange Commission, Gymboree said it has secured commitments for up to $308.5 million in additional financing. The Chapter 11 filing should reduce Gymboree's debts by more than $900 million, the company added.

Gymboree now has plans to shutter some 375 stores, according to court filings. The company currently operates 1,300 stores.

"Fitch's expectation of increasing retail defaults stems from increased discounter (including off-price and fast-fashion apparel) and online penetration, along with shifts in consumer spending toward services and experiences," the credit rating agency said. "These factors have created a highly competitive retail environment and accelerated adverse trends in mall-based shopping."

Just last week, Moody's also issued an updated report saying the ranks of distressed apparel and specialty retailers are growing.

In February, among Moody's rated retail and apparel issuers, 19 retailers had ratings of 'Caa' or lower. That number has now grown to 22 companies, or about 15 percent of the firm's retail and apparel category, Moody's reported.

Among those 22 distressed names are Gymboree which has now filed for Chapter 11 Sears, Nine West, Claire's Store, David's Bridal and Charming Charlie. In other words, many of the same retail players on Fitch's watch list.

Moody's lead retail analyst, Charlie O'Shea, has suggested keeping an eye on those 22 names to track which company might file for bankruptcy sooner rather than later. And there's a load of retail debt coming due in 2018, too, he added.

"Many retailers don't have the flexibility to do what they need to do," O'Shea told CNBC.

Watch: China's retail tailwind

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In the wake of Gymboree's bankruptcy filing, here are the retailers that could be next - CNBC

Esperanza Unidas chapter 11 bankruptcy filing will delay the city of Milwaukees efforts to find a new use for the organizations building on National Avenue.

The bankruptcy proceeding puts a hurdle in front of us in our plans to acquire the site, said Jeff Fleming, Department of City Development spokesman. For the time being we will no longer be advertising the site for development and await the bankruptcy proceeding to conclude.

The city issued a request for proposals in March in anticipation of acquiring the properties at 1313 and 1329-1331 W. National Ave. through foreclosure. Fleming said the city did receive some interest in the property, but declined to say if any or how many proposals were submitted, adding the process is now on hold.

Esperanza Unida, an organization that focuses on workforce and economic development, filed for chapter 11 last week. The organization said it has $1 million to $10 million in liabilities. Those debts included more than $400,000 in unpaid taxes owed to the IRS, nearly $150,000 owed to the state workers compensation fund and nearly $150,000 owed to the city of Milwaukee, including $72,000 in unpaid property taxes.

Esperanza Undia executive director Manny Perez, a former Department of Workforce Development secretary, said he is hoping to have the building generate revenue again in the future to help the organization pay down its debts.

The idea is to re-position the building for its mission, which is to accelerate economic development and create jobs, pay creditors, at least in a standard manner and accelerate entrepreneurship on the Milwaukee south side which is the mission of that building, Perez said.

He said he previously had found a buyer for the properties, but that deal fell through at the end of 2016. Perez said he then approached city officials to ask if they would acquire the site through a foreclosure under state brownfield statutes. He said the city agreed, but required him to find a buyer and declined to cover any attorney or realtor fees.

Perez said he couldnt find a buyer again and opted to find potential occupants for the facility instead. He said hes been able to secure three rental contracts for various portions of the building and hopes to find one more.

But he added the presence of the citys foreclosure and RFP actions have made prospective tenants nervous about moving forward with building repairs and occupancy.

Perez said his goal for the building is to get it rehabilitated as soon as possible and get it producing revenue, but those efforts are also complicated by the $1.5 million to $2 million in liens still on the building, he said.

Those liens were transferred over from Esperanza Unidasformer building at 611 W. National Ave. The city seized that property in 2014, after the then non-profit failed to pay property taxes. Esperanza Unida, which is currently run from offices at 2825 N. Mayfair Road in Wauwatosa, converted to a for-profit entity two years ago, Perez said.

If somebody wants to buy (the building in the 1300 block of National Avenue) for $2 million, Ill sell it, he said. If nobody is there for $2 million, we have to create a system where we restructure the debt and we make partial payments and the first thing that must occur is increased revenue. Im only doing what any good business person would do in the absence of a buyer.

Fleming said there has already been a lot of public discussion about the building and the city has an interest in seeing it return to providing tax revenue but more importantly to become an asset neighborhood.

Perez also said he has a longer term strategic plan for the organization, but declined to provide specifics.

Id rather report on what has been accomplished, not what hopefully will be accomplished, he said.

Esperanza Unidas chapter 11 bankruptcy filing will delay the city of Milwaukees efforts to find a new use for the organizations building on National Avenue.

The bankruptcy proceeding puts a hurdle in front of us in our plans to acquire the site, said Jeff Fleming, Department of City Development spokesman. For the time being we will no longer be advertising the site for development and await the bankruptcy proceeding to conclude.

The city issued a request for proposals in March in anticipation of acquiring the properties at 1313 and 1329-1331 W. National Ave. through foreclosure. Fleming said the city did receive some interest in the property, but declined to say if any or how many proposals were submitted, adding the process is now on hold.

Esperanza Unida, an organization that focuses on workforce and economic development, filed for chapter 11 last week. The organization said it has $1 million to $10 million in liabilities. Those debts included more than $400,000 in unpaid taxes owed to the IRS, nearly $150,000 owed to the state workers compensation fund and nearly $150,000 owed to the city of Milwaukee, including $72,000 in unpaid property taxes.

Esperanza Undia executive director Manny Perez, a former Department of Workforce Development secretary, said he is hoping to have the building generate revenue again in the future to help the organization pay down its debts.

The idea is to re-position the building for its mission, which is to accelerate economic development and create jobs, pay creditors, at least in a standard manner and accelerate entrepreneurship on the Milwaukee south side which is the mission of that building, Perez said.

He said he previously had found a buyer for the properties, but that deal fell through at the end of 2016. Perez said he then approached city officials to ask if they would acquire the site through a foreclosure under state brownfield statutes. He said the city agreed, but required him to find a buyer and declined to cover any attorney or realtor fees.

Perez said he couldnt find a buyer again and opted to find potential occupants for the facility instead. He said hes been able to secure three rental contracts for various portions of the building and hopes to find one more.

But he added the presence of the citys foreclosure and RFP actions have made prospective tenants nervous about moving forward with building repairs and occupancy.

Perez said his goal for the building is to get it rehabilitated as soon as possible and get it producing revenue, but those efforts are also complicated by the $1.5 million to $2 million in liens still on the building, he said.

Those liens were transferred over from Esperanza Unidasformer building at 611 W. National Ave. The city seized that property in 2014, after the then non-profit failed to pay property taxes. Esperanza Unida, which is currently run from offices at 2825 N. Mayfair Road in Wauwatosa, converted to a for-profit entity two years ago, Perez said.

If somebody wants to buy (the building in the 1300 block of National Avenue) for $2 million, Ill sell it, he said. If nobody is there for $2 million, we have to create a system where we restructure the debt and we make partial payments and the first thing that must occur is increased revenue. Im only doing what any good business person would do in the absence of a buyer.

Fleming said there has already been a lot of public discussion about the building and the city has an interest in seeing it return to providing tax revenue but more importantly to become an asset neighborhood.

Perez also said he has a longer term strategic plan for the organization, but declined to provide specifics.

Id rather report on what has been accomplished, not what hopefully will be accomplished, he said.

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Esperanza Unida bankruptcy delays city redevelopment efforts - BizTimes.com (Milwaukee)

Property Spotlight: SEALED BID OFFERING! Prime Development Land along the Salina, KS Retail Corridor

CST Industries hopes bankruptcy will help it clean up its balance sheet and perhaps find more

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Kansas City-based CST Industries Inc. filed a Chapter 11 bankruptcy petition to rightsize its balance sheet and potentially identify a new partner.

Founded in 1893, CST Industries (originally known as Columbian Steel Tank) is the largest manufacturer of steel tanks and covers in the world, with clients in agriculture, industrial liquids, oil and gas, water and wastewater, bioenergy and other markets. More than 350,000 of its tanks and 18,000 covers have been installed in 125 countries around the globe.

CST Industries hopes bankruptcy will help it clean up its balance sheet and perhaps find more

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Beset with overwhelming debt, the company decided to file for bankruptcy to give it an opportunity to once again thrive. The company listed between $100 million and $500 million in assets and liabilities.

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Big KC manufacturer files for bankruptcy - Kansas City Business Journal

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Autographed jerseys of Cleveland Cavaliers superstar LeBron James and Boston Celtics legend Larry Bird were among the items auctioned off during bankruptcy proceedings involving former NBA small forward Darius Miles.

On Sunday, TMZ Sports reported Miles received $12,780 from the sale of basketball memorabilia and other personal items. Additional basketball-related pieces included signed shoes from the Dallas Mavericks' Dirk Nowitzki and two-time NBA champion Lamar Odom.

Last September,Beth Hundsdorfer and George Pawlaczykof theBelleville News-Democratreported the third overall pick in the 2000 NBA draft listed less than $500,000 in assets and $1.57 million in liabilities on his bankruptcy paperwork.

Among his debts included $282,041 owed to the Internal Revenue Service and $20,000 in unpaid child support, according to theBelleville News-Democrat.

Miles received $1,500 for the James jersey, $100 for the Bird jersey, $375 for the Nowitzki shoe and $225 for the Odom shoe during the sale, per TMZ Sports. He also earned $900 from the sale of two guns and two bucks for his toaster, among other items.

The 35-year-old Illinois native played seven seasons in the NBA with the Los Angeles Clippers, Cleveland Cavaliers, Portland Trail Blazers and Memphis Grizzlies. He averaged 10.1 points, 4.9 rebounds and 1.9 assists across 446 appearances.

He most recently played during the 2008-09 season, appearing in 34 games with the Grizzlies.

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Darius Miles' Bankruptcy Sale Includes Signed LeBron James, Larry ... - Bleacher Report