Chapter 11 Bankruptcies Com
Bankruptcy and Gift Cards – 4 Reasons Why Retailers Should Honor Gift Cards During Bankruptcy Reorganization
What happens to gift cards when a company files for bankruptcy? The recent bankruptcies of Linens 'n Things, The Sharper Image, and Bombay Company have brought the issue of gift card redemption during bankruptcy to the forefront. With the economic situation expected to worsen in 2008, more retailers are likely to file for bankruptcy, and as expected, consumers with gift cards will be affected.
When you buy a gift card, you become an unsecured creditor to the gift card issuer until you redeem the full value of your gift card (unless it expires or is eaten-up by fees). If the gift card issuer files for Chapter 11 bankruptcy protection, federal law allows the company to stop honoring gift cards. However, the company may petition the bankruptcy court to allow the continued redemption of gift cards.
A company planning to continue in business should make every effort to honor gift cards while under bankruptcy protection. Refusing to accept gift cards is a bad move and could ultimately work against the company since it will only infuriate the very customers it really needs during bankruptcy reorganization. Below are four (4) reasons why continuing the redemption of gift cards under bankruptcy reorganization is a smart move for a retailer:
Maintain Customer Loyalty: If the company plans to stay in business, refusing to accept gift cards will only anger customers, who will feel cheated. This will not only turn away current customers but also drive potential customers to the competition. This is because some aggrieved customers will share their horrible experiences with family members, friends, and coworkers who will likely stay away from the company since they would not like to go through a similar experience. In today’s world where emails spread like viruses, the last thing a company needs is for an email to be circulating about the horrible experience gift card holders went through with the company.
Minimize Competitor Actions: When a company suspends the redemption of gift cards during bankruptcy, it opens the door for the competition to steal its customers. A good example was seen during the recent bankruptcy of The Sharper Image. At the onset of the bankruptcy, the company announced the suspension of gift card redemption. As expected, affected customers reacted negatively to the decision. Brookstone and ThePurePro.com, both competitors to the Sharper Image saw an opportunity to gain more customers so they announced special discounts targeted at The Sharper Image gift card holders. It appears The Sharper Image began to feel the impact of these actions and it later reversed its decision and began accepting gift cards from customers.
Project Business as Usual Image: When a company files for Chapter 11 bankruptcy, it typically proposes a plan of reorganization to keep its business alive. This plan may include selling, closing, or consolidating some store locations. For the stores locations that remain open, it is important to project an image of business as usual.
Refusing to accept gift cards would be the wrong signal to send since it reminds customers that the company is in serious trouble. Customers may begin to wonder if service will begin to deteriorate, especially support for big ticket items. Continuing the redemption of gift cards is a good way to assure customers that their shopping experience with the company will not be impacted negatively by the bankruptcy.
Increase Sales: Research has shown that gift card holders typically spend about 20% more than the value of the gift card. By accepting gift cards during bankruptcy, the company has the potential to increase sales since people redeeming gift cards would likely spend more than their gift card value, thereby helping the company boast sales and hopefully become more profitable.
About the Author
Kwame Kuadey is an expert on Gift Cards and runs a popular Gift Card Blog. You can find more information on Gift Card Ideas, Gift Card Holders & Packaging, Gift Card Exchange, and Free Gift Card deals by visiting his site at GiftCardBlogger.com. GiftCardBlogger is a service of GiftCardRescue.com.
Filed under Debt Settlement by on Mar 7th, 2010. Comment. 
Company Filing Bankruptcy
What happens to my New Century Stock if the company files for bankruptcy protection?
I have 500 shares of New Century (NEW) stocks. I was just wondering if they would be totally worthless if the company files for bankruptcy protection.
Normally when a company files for bankruptcy, there is virtually no equity remaining in the company. So if a bankruptcy filing occurs, most like you can kiss your 500 shares goodbye.
Need to File Bankruptcy Chapter 7
Chapter 7 is a great tool in eliminating really huge mountains of debts. Unlike chapter 13 that will still require you to pay your debts in a reorganization plan, chapter 7 pays debts through liquidation and any remaining debts that are not covered by the proceeds derived from the properties that are liquidated are simply forgotten or eliminated. If you need to file bankruptcy chapter 7, there are a qualifications that you need to meet before the judge can honor your bankruptcy petition.
The first thing you need to think about is your income. How much do you earn? Do you earn a lot? Do you have excess money after all of your expenses are paid each month? These are the questions that you need to answer. Foresee if you can pass the means test; this test will show a result that will determine if you have means to pay your debts or not. Having the means to pay, you cannot file for a chapter 7 but will be encouraged to file a chapter 13, which is a repayment plan. Timing is everything in filing for bankruptcy. If you think you will not pass your means test and you know that after a few months your income will drop for some specific reasons then all you need to do is wait a little bit longer. When your income starts to fall down to a degree that you feel comfortable enough that you can pass the means test, then that is the right time to file bankruptcy chapter 7.
Be sure your income is below average before filing for a chapter 7 type of bankruptcy. This will increase your chances of being qualified. Other factors that can affect filing for chapter 7 are prior bankruptcy cases that you had filed. If you did file bankruptcy in the past, you may want to check on their commencement date so that you can calculate what year your bankruptcy status would be discharged because it is only when the prior bankruptcy status gets discharged that you can file for bankruptcy again.
If you need to file bankruptcy Chapter 7 that costs less, there are few ways that you can do that. First is to try filing for chapter 7 online. Just pick a bankruptcy website of your choice from the thousand sites online. This can be fast and convenient compared to the traditional way. All you need is a computer and an internet connection. You will find a lot of bankruptcy companies online that will help you file your bankruptcy. Remember to never compromise because you can always look for someone else that suits you.
For more support on how to file bankruptcy, visit the link below.
About the Author
Steve Young is the author of The #1 Secret On How To File Bankruptcy. To get your free CD on How to File Bankruptcy Without an Attoney, go to www.onlinebkassist.com
Filed under Debt Settlement by on Jan 11th, 2010. Comment.
Business Bankruptcy Liquidation
What Is Bankruptcy Liquidation?
Bankruptcy liquidation also known as Chapter 7 Bankruptcy is a legal process where most if not all of your debt can be eliminated. It may take four up to six months and currently costs $299 to file. Bankruptcy liquidation can be used by individuals and businesses.
However, it is not as simple as filing a petition and the court grants the request. In bankruptcy liquidation, the debtor has to give up certain properties to be sold or liquidated in order to pay off as much of the debt as possible. The bankruptcy laws in your state dictate what property can and cannot be taken away from you. In general, properties of necessity such as clothing, household items, and tools you need for your profession are considered exempt. When you do not have much property that can be liquidated your case will be classified as no asset and there will be no payment distribution to your creditors.
In order to be eligible, you should not have received a chapter 7 bankruptcy discharge within the past 8 years or a chapter 13 bankruptcy discharge within the past 6 years. Your monthly income should be lower or equivalent to the median income of your state. You will be required to take a means test to determine your eligibility.
Before filing for bankruptcy liquidation, you will have to get credit counseling from an agency that has received approval from the United States Trustee. Afterwards, you can proceed with filling out all the necessary bankruptcy forms, which will basically ask you to state the source and amount of your income, monthly expenses, debts, and information about your assets. You need to file these forms along with the certificate of your credit counseling session with your local bankruptcy court.
Once you have filed for bankruptcy liquidation, a rule called automatic stay takes effect which can be very helpful in urgent situations. It temporary protects you from lawsuits, wage garnishments, eviction, foreclosure, and disconnection of utilities supplies.
When you file your case, the court will appoint a trustee whose duty is to liquidate your non-exempt assets and distribute payment to your creditors. A week or so after you have filed you and the creditors you have listed will be sent a notice informing you about the creditors meeting. During this meeting, you will be under oath while the trustee questions you about the information you have provided in your bankruptcy papers. Usually, this meeting does not last more than 10 minutes.
The last stage in the bankruptcy liquidation process is the discharge of debt. You must take note that certain debts may not be eliminated such as family or child support, student loans or tax debt. Once you have received bankruptcy discharge, you are free from any legal obligation to pay the creditors of your discharged debt. The record of your filing will be on your credit report for the next 10 years.
About the Author
T. J. Madigan has been established in online business since 1998 and is director of a number of successful online projects. For more accounting information visit Madigans.info or you can view a selection of accounting related articles at Articles.net.au - your source for free Articles, Information and Website Content.
Business Refinancing used to prevent Company Bankruptcy (Liquidation)
Business Refinancing used to prevent Company Bankruptcy (Liquidation)
In the midst of an economic downturn, many companies find themselves at risk of failure because they do not have enough cash to maintain their day to day business activities. This may be the case even if there is a strong order book as customers fail to pay invoices on time as they in turn are trying to preserve cash. There is also the increased risk that the customers themselves may stop trading leaving outstanding invoices unpaid.
Unfortunately, one of the reasons for the current recession in the UK is the lack of available funding through traditional routes such as bank loans and commercial mortgages. High Street banking institutions are currently extremely reluctant to lend because of the huge bad debt risks they have exposed themselves to over the past 5-10 years. Faced with this situation, it is not surprising that many businesses are running out of cash and considering bankruptcy and liquidation.
Where a company requires additional working capital (cash) but is not being supported by traditional banking services, there are other funding options which should be considered, these are collectively known as business re-financing. The most significant of these are as follows:
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Asset refinancing
Raising finance secured on the value physical assets owned by the business such as plant or machinery.
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Invoice financing
Raising finance on the strength of invoices already raised for work carried out. The finance company pays out up front and then collects the money over time as invoices are paid.
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Trade financing
Finance provided to enable a company to fulfil a confirmed order. The finance company will typically pay suppliers directly and in turn invoice the end customer. Once the customer has paid, adhering to the typical payment terms, the finance company releases any profits back to the business.
Of course, there are certain elements of the business refinancing process which have to be carefully considered. The main one of these is that personal guarantees will have to be given by the company directors / owners. This is of course no different to a standard business loan. However, the business refinance loan will be based on the availability of real company assets or actual invoices or orders thus reducing the risk of the loan not being paid and guarantees being called into play.
All possible options are worth pursuing if the company is facing bankruptcy or liquidation due to poor cash flow. Business refinancing may not be suitable for all businesses. Nevertheless, where suitable, it can certainly provide a viable alternative to traditional sources of finance such as bank loans and commercial mortgages.
About the Author
Derek Cooper is Managing Director of Cooper Matthews Ltd, and a member of the Turnaround Management Association UK.
More details about Business Refinancing at http://coopermatthews.com/business-refinancing.html
Cooper Matthews specialise in Business Refinancing and Business Recovery Services Advice providing straight forward insolvency advice for businesses with financial problems to turn your business around. They have significant experience in working with small to medium sized businesses. Derek's experience of both corporate insolvency and business management puts him in a position to be able to understand the challenges facing businesses in today's economic climate.
Filed under Debt Settlement by on Nov 3rd, 2009. Comment.
Company Filing For Bankruptcy
What happens to my stock if a company files Chapter 13 bankruptcy?
Other than selling it right now, if the company files for 13 does the stock become worthless or is that only if it files for Chapter 7?
Chapter 13 is for individuals. Companies have to file Chapter 7 or 11. Either way in Chapter 7 or 11 there is usually no equity left. Debtholders get everything and common shareholdes being the last ones to get paid off usually end up with nothing. In Chapter 11 the stock is usually canceled and new stock issued which shareholders have to buy again. In Chapter 7 the company is liquidated.
Shall I File for Bankruptcy
Many people are not sure if they should file bankruptcy or allow a foreclosure. This is not a decision which can be made easily, and is really not a straightforward case. A mortgage lender will file a foreclosure action when it is not paid its monthly mortgage payments. The only way to stop this from occurring is to pay the mortgage lender.
Understandably, most people do not want to have their car repossessed, so they make their car payments on time every month. If a person does not make their mortgage payments, they face the loss of their home through foreclosure.
Bankruptcy is a legal action filed by someone who cannot pay his debts. This action stops all civil proceedings against the debtor while the debtor is in bankruptcy. As a result, the mortgage lender is incapable of immediately continuing their foreclosure, or any other legal action. On the other hand, a mortgage lender can get around this by filing for a relief from automatic stay and proceeding with their action once the stay has been granted. Essentially, bankruptcy will not stop foreclosure, and will not allow anyone to keep a home without paying the lender. Slowing down the legal process is all that bankruptcy can achieve.
Occasionally, however, foreclosure is prevented through bankruptcy, as the latter gives person additional time in which to pay the lender and usually makes the paying easier. Bankruptcy makes a mortgage lender pause in their foreclosure efforts, and a debtor has a little extra time to raise the money.
Through bankruptcy, many unsecured debts are eliminated completely, and a person who is in debt will frequently find that they have money to pay their mortgage payments with that they didn't before bankruptcy. A chapter 13 bankruptcy allows the debtor to pay the mortgage over a period of time through a court ordered payment plan.
However, not everyone qualifies for filing of bankruptcy in the first place, and those that do must pay sufficient legal fees. Legal bills can be quite high, and high enough that they outweigh the costs of catching up with the mortgage. Anyone considering bankruptcy to prevent foreclosure should discuss it with a lawyer. No one should attempt a complicated legal process like bankruptcy without legal aide. This article is only intended to give general information, so for more detailed information, contact a lawyer in your state.
A bankruptcy lawyer is there to represent and protect his client during the bankruptcy process which can be an extremely stressful time for many people. As the changes in the law have meant that filing for bankruptcy is now more time consuming, it means that a number of people have found themselves struggling with the process. Although the amendments to the bankruptcy law are designed to eliminate the time wasters, no other real changes have been made.
Some States also have additions to the federal code but your bankruptcy lawyer will be able to inform you about these and how they will affect your bankruptcy period. The Insolvency law is designed to protect certain things like your house and car. Very soon after you have filed for bankruptcy, you will begin to get credit offers and you will want to exercise great caution in deciding which offers to accept, and when to accept.
You will notice within a short period of time after your bankruptcy has been filed that applications for credit are already forthcoming.. What this means is that within a relatively short space of time after you become bankrupt you will start receiving credit applications but at this stage you must be very careful. This is the reason why not long after you have been made bankrupt, a whole host of companies offering credit will start contacting you, but you must be very careful at this time.
To prove this point, your lawyer should warn you about certain financial companies that contact bankrupt people and offer credit. Extreme caution is required here.
It is not because the individual is a failure looking for an easy way out of his debts as the credit companies would like you to believe. Bankruptcy is generally seen as a last resort, but as legislation continues to add changes, it will become harder for individuals to apply for bankruptcy. While there are obviously some people that want to take advantage of the bankruptcy protection system, your bankruptcy lawyer will assure you that you are just a victim of bad luck who is being given a second chance.
About the Author
Find out more about bankruptcy alternative, bankruptcy lawyer and more at bankruptcy-foreclosure site or visit http://www.bankruptcy.foreclosure-review.info/
Filed under Debt Settlement by on Mar 15th, 2009. Comment.
Company Bankruptcy Filing
What are your rights as an employee regarding payroll if company is filing Chapter 7 Bankruptcy?
In the state of California.
We were paid some yesterday, but not all that is due. What are the options we have for getting money due including un-paid commissions.
payroll is number two on the priority list for unsecured debts in bankruptcy. Taxes due are number one. banks and trade creditors are after you.
the bankruptcy trustee will handle this, if and after he determines there is sufficient cash to pay both the taxes and you.
it'll take a while ... possibly several months.
you should receive forms from the Trustee -- make sure you do, fill them out, and send them back in.
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fyi ... commissions due are not as secure as you'd like to think. every bankrupt company i've ever dealt with or about has had a rash of sales return claims and a sales return usually means no commission is due for that sale.
sharks among the buyers who don't need the products immediately make the return claims, sometimes on flimsy excuses, in the hope of being able to buy the product from the Trustee later for much less during the "going out of business sale".
Is it Better to Usa a Debt Consolidation Company or File Bankruptcy When You Own a Home?
Owning your own home is the American dream, and every day millions of people work hard to maintain their small piece of the dream.
Along the way people build up other kinds of debt besides their mortgage, and some people eventually find themselves overwhelmed by high interest rate credit card debt.
Aurora Lillo Editor of the "Best Debt Consolidation Services" website -- http://www.FreeDebtConsolidationQuotes.net -- pointed out;
“…Somewhere along the way the American dream starts to get a little cloudy, and as the debt continues to pile up the dream could turn into a nightmare. As the family gets bigger and the expenses pile up, it can look like there is no where to turn. Many people consider bankruptcy while they should be thinking about debt consolidation…”
People look for advice from many different sources when they are trying to get their debt under control, but many times they forget to look in the places where the best advice awaits them. If you are buried in high interest rate credit card debt and you are considering filing bankruptcy to clear your debt, you will want to speak to a debt consolidation company before you file those papers.
Your situation may seem bleak to you, but it may be something that an experienced debt expert could help you with by placing you into the right debt program for your situation.
When people who own a home file for bankruptcy, it is common for the home to be listed as an asset that should be given up especially if the house is still under a mortgage. You have worked hard to provide the American dream to your family, and there is no reason why a mountain of high interest credit card debt should force you to have to give up on that dream.
A debt organization will combine all of your high interest rate credit card debt into one low interest rate loan that you can easily afford. They will take all of those high monthly service charges you used to pay and replace them with one reasonable set of loan service charges.
“…They will help you free up hundreds of dollars a month in cash flow, and you can use that money to pay your other bills and avoid bankruptcy. Don’t let high credit card debt take your dream from you, contact a debt assistance professional before you file any bankruptcy papers…” added A. Lillo.
Further information about trusted and reputable companies for debt consolidation by visiting; http://www.FreeDebtConsolidationQuotes.net
About the Author
Hector Milla runs his corporate website at http://www.OpsRegs.com where you can see all his articles and press releases.
Filed under Debt Settlement by on Jan 17th, 2009. Comment.
