Friday, June 10, 2011
Charlie Batch Bankruptcy: Exposing the too frequent plight of professional athletes.
Charlie Batch, the journeyman backup Quarterback of the Lion and Steelers recently filed for Chapter 7 Bankruptcy. He made over $20 million over his playing days but claims that bad investments have dissipated all of that income. While it is probably true that he did invest in well-intentioned business ventures, I would suppose that many other "poor investments" like expensive cars, jewelry, trips to Atlantis, etc. were involved in the dooming of Mr. Batch's economic status. It is sad to see but the majority of professional athletes are broke within 3 years of ending their careers. Their plight illustrates what dooms most of us in our own small way. Borrowing against our future for the toys and trips we want today. If this has or is happening to your family I encourage you to visit my website www.attorneyok.com and research how bankruptcy can afford you a fresh start. Remember, true ignorance is only failing to learn from our mistakes. You likely have paid expensive tuition on those lessons so make the most of it. We help Oklahoma file Chapter 7 and Chapter 13 Bankruptcy and let them get on with a more enjoyable and stress-free, debt-free life.
Wednesday, June 8, 2011
Stress, Cancer & Bankruptcy
A recent study has detected a strong correlation between folks who have been diagnosed with certain kinds of cancer and later bankruptcy filings. While this speaks to the financial devastation that debilitating illnesses cause to a family's finances, there is something more to glean from this. I would suppose that there is a bigger connection here. Research in the 90s showed that stress reduces the cancer-fighting white blood cells in our body exposing us to an increased risk of cancer. I would assume that if you were to take a closer look at the cancer/bankruptcy study you would find that those people who were diagnosed with cancer and later filed bankruptcy were already suffering financial stress prior to the diagnosis. . .the illness just further exacerbated the issues.
The take away here is that the stress that people have who are suffering through financial difficulties can be tremendous. Every day I see people who are at the end of their rope and are, quite literally, dying from stress. I encourage everyone to look at the connections between stress and poor health and realize that there may be a solution to your financial stress in bankruptcy. Just remember. . .bankruptcy is not the evil concoction that it is made out to be. . .it may just save your life.
The take away here is that the stress that people have who are suffering through financial difficulties can be tremendous. Every day I see people who are at the end of their rope and are, quite literally, dying from stress. I encourage everyone to look at the connections between stress and poor health and realize that there may be a solution to your financial stress in bankruptcy. Just remember. . .bankruptcy is not the evil concoction that it is made out to be. . .it may just save your life.
Tuesday, June 7, 2011
Company That Owns the Spiegel Brand Files for Chapter 11 Bankruptcy
Signature Styles (Spiegel, Newport News & Shape Fx Brands) Files for Chapter 11 With Deal to Sell All Assets
Signature Styles which operates a primarily internet/catalog retailer specializing in women’s apparel Spiegel, Newport News and Shape Fx brands, filed for chapter 11 bankruptcy June 6, 2011 in Delaware. The company acquired Spiegel Brands, Inc., which were being sold in a foreclosure sale conducted by Dymus Funding Company, LLC. Signature Styles was the only bidder for the assets and paid $21.7 million.
$48.6 million of assets and liabilities of $87.6 million were listed in the schedules. Secured debt is $14.6 million owed to Zohar II 2005-1 Limited and Zohar III, Limited, and $22.64 million owed under a term loan facility provided by Zohar III, Limited. The obligations owing to the Zohar entities, which are investment funds managed by companies whose collateral manager is related to Patriarch Partners Agency Services, LLC, are secured by liens on substantially all of the debtors’ assets. The companies’ remaining debt consists of $9.8 million of trade debt, $23.2 million of obligations to customers for returns, credits and gift cards, and various other unsecured obligations. The debtors’ equity is wholly-owned by Zohar III, Limited.
The debtors plan to use the chapter 11 cases to effectively liquidate most of their assets. They’ve also petitioned for approval of bidding procedures to facilitate a quick sale and have received a stalking horse bid for the assets from a newly-created affiliate of the pre-petition lenders (i.e., the Zohar entities and Patriarch Partners). Under the proposed stalking horse agreement, the consideration that the purchaser (Artemiss, LLC) would provide for the assets would consist primarily of solely the assumption of certain liabilities of the Signature Styles companies. Specifically, the purchaser would assume the following liabilities:
Up to $30 million of outstanding DIP loan, pre-petition term loan and pre-petition revolver loan obligations. These claims are all owed to affiliates of the proposed purchaser.
“All liabilities accruing or due to be performed from and after the closing under the Assumed Contracts, Assumed Leases and the Post-Petition Contracts” (all capitalized terms as defined in the sale agreement).
“All liabilities for employee compensation and certain employee benefits.”
“The liabilities and obligations of Sellers to retail customers for (i) merchandise returned to Sellers that was purchased on or after the Petition Date [June 6, 2011] to the extent not satisfied as of the Closing Date, (ii) outstanding merchandise ordered on or after the Petition Date [June 6, 2011] to the extent not satisfied as of the Closing Date and (iii) gift cards or gift certificates purchased on or after the Petition Date [June 6, 2011] to the extent not satisfied as of the Closing Date.”
“All liabilities under or in respect of any employee benefit or welfare plan.”
However, if the stalking horse bidder is not the winning bidder at auction, the agreements provide that the successful bidder would not be able to assume any portion of the outstanding DIP loan, pre-petition term loan and pre-petition revolver loan obligations, but would instead be required to pay those obligations in full. In addition, the proposed agreement does provide some proposed relief for existing customers of the debtors (in other words, customers of Spiegel, Newport News and/or Shape Fx). If it is the successful bidder, Artemiss would provide “merchandise credits under its loyalty award program for prior retail customers of [the debtors] in amounts, dollar-for-dollar, equal to (a) the amounts payable for returns of merchandise purchased prior to the Petition Date [June 6, 2011] and that are to be settled in cash by [the debtors] under [the debtors'] current [return] policy and that remain outstanding on the Petition Date, and (b) up to $10 million of the amount of any remaining balance of gift cards or gift certificates that were purchased by third parties prior to the Petition Date or that were issued or are to be issued for returns of merchandise purchased prior to the Petition Date in accordance with [the debtors' current return policy].” The new loyalty credits would be good only for merchandise offered for retail sale by the purchaser and would expire as follows:
For merchandise return credits (subpart (a) above), on the first anniversary of the closing of the sale
For gift card credits (subpart (b) above), four months after the closing of the sale
According to a footnote in the debtors’ motion, they estimate that there are currently approximately $18.1 million in outstanding gift cards and gift certificates which would fall within the $10 million cap described in subpart (b) above.
Signature Styles which operates a primarily internet/catalog retailer specializing in women’s apparel Spiegel, Newport News and Shape Fx brands, filed for chapter 11 bankruptcy June 6, 2011 in Delaware. The company acquired Spiegel Brands, Inc., which were being sold in a foreclosure sale conducted by Dymus Funding Company, LLC. Signature Styles was the only bidder for the assets and paid $21.7 million.
$48.6 million of assets and liabilities of $87.6 million were listed in the schedules. Secured debt is $14.6 million owed to Zohar II 2005-1 Limited and Zohar III, Limited, and $22.64 million owed under a term loan facility provided by Zohar III, Limited. The obligations owing to the Zohar entities, which are investment funds managed by companies whose collateral manager is related to Patriarch Partners Agency Services, LLC, are secured by liens on substantially all of the debtors’ assets. The companies’ remaining debt consists of $9.8 million of trade debt, $23.2 million of obligations to customers for returns, credits and gift cards, and various other unsecured obligations. The debtors’ equity is wholly-owned by Zohar III, Limited.
The debtors plan to use the chapter 11 cases to effectively liquidate most of their assets. They’ve also petitioned for approval of bidding procedures to facilitate a quick sale and have received a stalking horse bid for the assets from a newly-created affiliate of the pre-petition lenders (i.e., the Zohar entities and Patriarch Partners). Under the proposed stalking horse agreement, the consideration that the purchaser (Artemiss, LLC) would provide for the assets would consist primarily of solely the assumption of certain liabilities of the Signature Styles companies. Specifically, the purchaser would assume the following liabilities:
Up to $30 million of outstanding DIP loan, pre-petition term loan and pre-petition revolver loan obligations. These claims are all owed to affiliates of the proposed purchaser.
“All liabilities accruing or due to be performed from and after the closing under the Assumed Contracts, Assumed Leases and the Post-Petition Contracts” (all capitalized terms as defined in the sale agreement).
“All liabilities for employee compensation and certain employee benefits.”
“The liabilities and obligations of Sellers to retail customers for (i) merchandise returned to Sellers that was purchased on or after the Petition Date [June 6, 2011] to the extent not satisfied as of the Closing Date, (ii) outstanding merchandise ordered on or after the Petition Date [June 6, 2011] to the extent not satisfied as of the Closing Date and (iii) gift cards or gift certificates purchased on or after the Petition Date [June 6, 2011] to the extent not satisfied as of the Closing Date.”
“All liabilities under or in respect of any employee benefit or welfare plan.”
However, if the stalking horse bidder is not the winning bidder at auction, the agreements provide that the successful bidder would not be able to assume any portion of the outstanding DIP loan, pre-petition term loan and pre-petition revolver loan obligations, but would instead be required to pay those obligations in full. In addition, the proposed agreement does provide some proposed relief for existing customers of the debtors (in other words, customers of Spiegel, Newport News and/or Shape Fx). If it is the successful bidder, Artemiss would provide “merchandise credits under its loyalty award program for prior retail customers of [the debtors] in amounts, dollar-for-dollar, equal to (a) the amounts payable for returns of merchandise purchased prior to the Petition Date [June 6, 2011] and that are to be settled in cash by [the debtors] under [the debtors'] current [return] policy and that remain outstanding on the Petition Date, and (b) up to $10 million of the amount of any remaining balance of gift cards or gift certificates that were purchased by third parties prior to the Petition Date or that were issued or are to be issued for returns of merchandise purchased prior to the Petition Date in accordance with [the debtors' current return policy].” The new loyalty credits would be good only for merchandise offered for retail sale by the purchaser and would expire as follows:
For merchandise return credits (subpart (a) above), on the first anniversary of the closing of the sale
For gift card credits (subpart (b) above), four months after the closing of the sale
According to a footnote in the debtors’ motion, they estimate that there are currently approximately $18.1 million in outstanding gift cards and gift certificates which would fall within the $10 million cap described in subpart (b) above.
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