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Gibson seeks bankruptcy protection using pre-negotiated plan

After months of negotiations with creditors, Gibson Brands, Inc., the Nashville-based maker of legendary Gibson guitars, has filed a petition under Chapter 11 of the Bankruptcy Code. The filing was accompanied by a plan of reorganization that had already been negotiated with the company's creditors. The plan offers lessons for both large and small companies considering a business bankruptcy.

Car dealer bankruptcy clouded by allegations of fraud

The bankruptcy process depends in many ways on cooperation between the debtor and its creditors to resolve issues about asset value, existing debts and the history of the business before the petition is filed. When the parties cannot reach agreement, or when the disagreements become particularly intense, the bankruptcy court often takes a more active role in monitoring the parties' behavior. The commercial bankruptcy of Auto Masters, a group of used car lots in and around Nashville, has recently taken such a turn.

How debtor-in possession financing can help a small business

Tennessee business owners who decide to file a petition for bankruptcy under Chapter 11 of the Bankruptcy Code intend to reform their company's finances and to emerge from bankruptcy slimmed-down and healthy. One of the most effective tools to achieve this intent is debtor-in-possession financing.

What is a small business bankruptcy case?

When a small business in Rockland County is failing financially, the owner usually considers two types of bankruptcy - a dissolution under Chapter 7 of the Bankruptcy Code or reorganization under Chapter 11. Choosing the former usually means that the business will ultimately be dissolved, and the latter may cost many thousands of dollars in filing fees and attorney costs. A compromise is provided by provisions in the Bankruptcy Code directed at small business bankruptcies - the so-called "small business case."

Toys 'R' Us calls it quits after reorganization efforts fail

Business bankruptcies generally do not evoke an emotional response from anyone other than the company's shareholders and employees. A rare exception to that rule is the reaction to the recent announcement by toy retailer Toys 'R' Us that it will close all of its 740 stores in the United States over the next few months. The announcement was greeted with sadness and a sense of loss by the millions of adults who remember spending their childhoods wandering through the aisles of their favorite Toys 'R' Us store. The causes of this large commercial bankruptcy provide powerful warning signs for other big box retailers.

Tennessee-based nursing home chain files Chapter 11 petition

A firm that files a Chapter 11 bankruptcy petition often engages in complex and lengthy negotiations with its creditors during the course of the bankruptcy process. In some bankruptcies, however, these kinds of negotiations often occur before the petition is filed. Such pre-petition negotiations are often undertaken to determine if a suitable plan of reorganization is possible. A Chapter 11 petition may be fruitless if one or more large creditors are not willing to renegotiate the terms of their agreements with the debtor. An example of a pre-petition negotiation was recently provided in connection with the business bankruptcy filing of a large nursing home operator based in Tennessee.

What is involuntary bankruptcy?

Creditors of a failing business in Tennessee often regard the filing of a bankruptcy petition by a creditor with dread because they fear that their claims will be dismissed by the bankruptcy court. Why, then, would a creditor want to force a debtor into business bankruptcy by filing what is known as an "involuntary petition"?

Iconic guitar manufacturer, Gibson faces bankruptcy

One of the most widely recognized names in the music industry is Gibson -- the maker of both acoustic and electric guitars. The parent company, Gibson Brands, Inc., has been based in Nashville since 1974, when it moved to begin manufacturing its most famous product, the Les Paul electric guitar. Now, the famous company is facing the possibility of seeking relief from mounting debt in Chapter 11 bankruptcy.

What is an executory contracts in a business bankruptcy?

Many Tennessee businesses that are considering bankruptcy have a number of continuing contracts, such as a supply contract, a real estate lease or any contract in which both parties have unperformed obligations. The bankruptcy code accords such contracts, known as executory contracts, a special status: the debtor in a business or commercial bankruptcy may either affirm or reject any such contract. The central question faced by debtors and their contracting partners is whether a given agreement is, in fact, an executory contract.

Another sit-down restaurant falls on hard times

Romano's Macaroni Grill, an upscale Italian restaurant chain that once had locations sprouting up all over the country, has announced it will enter a Chapter 11 business bankruptcy in order to restructure its debts so that it might be able to continue to operate.

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