Sears Holding Corp, which owns Sears and Kmart, filed for chapter 11 bankruptcy protection last month. Not showing a profit since 2010, Sears has been unable to compete with giants like Walmart and Amazon.
The iconic retailer is attempting to restructure over $5 billion in debt. Part of the plan is to close less profitable locations.
Added to the list of over 142 locations previously marked to be closed is an additional 40 stores, two of which are in the Sacramento Area. The Sears on Florin Road and Kmart in Placerville are scheduled to close after the holiday season. The added store closures are an attempt to keep the corporation afloat while they try to find a buyer or lender in the restructuring process.
Over 1,200 jobs will be lost in California
Across California, 17 stores will be closed. The company filed legal notices with the state of California showing 1,211 layoffs by the end of the year. As a result, local Sears and Kmart employees have been told their jobs will be eliminated by February 2019.
A spokesman for Sears said plans to liquidate the existing merchandise in the closing stores will result in steep discounts for customers.
Restructuring through Chapter 11
Chapter 11 bankruptcy is frequently referred to as "restructuring" or “reorganization” bankruptcy. By filing chapter 11, Sears Holding Corporation is requesting the courts to give them time to restructure their debts and get a fresh start.
During the restructuring process, the company will operate business as usual while developing a plan on how to negotiate debts and pay off creditors.
If you have lost your job, or other unforeseen circumstances have made it difficult to pay your debts, contact a Sacramento Attorney to discuss your options.
Verity Health Systems filed for California Bankruptcy protection in August of 2018. The nonprofit health care system operated four San Francisco Bare Area hospitals with over $500 million in long-term debt and all healthcare facilities needing major updates. Even before their Chapter 11 bankruptcy case, the organization has been looking for buyers for its struggling facilities. This week announced the location of potential buyers with the Santa Clara Country working to purchase the insolvent hospitals
The sale of the two hospitals, the O'Conner Hospital in San Jose and the Saint Louise Regional Hospital in Gilroy, will be significant as they are responsible for the care of a large number of low-income individuals who live in those communities. With around 87% of the patients receiving Medicare or Medi-Cal, the hospitals are huge assets to the community. A Chapter 11 bankruptcy in California will allow both facilities to remain operational throughout the bankruptcy process.
Santa Clara County Offer
Santa Clara County has officially tendered an offer to buy both the hospitals from the financially struggling company Verity Health Systems as part of their $235 million bankruptcy reorganization. If a US Bankruptcy Court Judge approves Verity's request to sell the hospitals in December, the company will have the opportunity to compete with any other buyers that may come forward. As such, the bid doesn't necessarily guarantee that the County will win the auction, but city officials cited in the matter said they feel confident about the competitiveness of their offer.
Sacramento California Bankruptcy
Just like business has debt relief options, the US Congress has afforded individuals who are struggling with debt or insolvency an opportunity to file a California Bankruptcy petition for debt relief. Depending on your income and debt, you may be eligible to have some or all of your unsecured debt legally eliminated under the US Bankruptcy Code. Contact a Fairfield bankruptcy attorney to discuss your situation and options if you have more debt than you could pay off within 5 years.
One of the great things about the Sacramento area is that there are rich opportunities for small businesses to thrive and flourish from Carmichael to El Dorado Hills. There are restaurants owned locally on every street. There are offices for every type of professional service, from dentists to certified public accountants. While these small businesses are a valuable part of our community, that doesn’t necessarily mean it is easy to be a small business owner.
Any number of issues can arise for a small business, including all kinds of tax liability, tort liability for a personal injury, liability for disabled access issues, and more. Not to mention business can simply be down or fluctuate greatly over periods of time. In these situations it may be a good idea to explore the possibility of filing for bankruptcy protection.
Bankruptcy can be the solution that allows a small business owner to reorganize debts to save the business, liquidate the company, or wipe out personal liability for business debts. Depending on the owner’s particular goals, it might be a good idea to file a business bankruptcy, a personal bankruptcy, or both.
A Chapter 11 bankruptcy is the one most people have heard of on the news. It is typically known as a business reorganization bankruptcy. This type of bankruptcy is typically used by businesses who want to continue operating while in the bankruptcy. This type of bankruptcy can be more expensive and complicated when compared to other types of bankruptcy. But, if the business has less than a certain amount of debt, it can be classified as a small business, which usually can proceed more quickly because there are fewer procedural hurdles over which to jump.
A business Chapter 13 doesn’t really exist in the same way as a Chapter 11 or Chapter 7. However, in a sole proprietorship, the debtor and her business are considered the same entity. In that case, business debts are considered part of the bankruptcy. A Chapter 13 then is designed to allow the debtor to keep all personal property and reorganize debts through a three to five year repayment plan. This could be a great option for sole proprietors who have substantial assets and want to continue operating.
A business Chapter 7 is good for a partnership, corporation, or LLC that is looking to close down, or liquidate, a business. In these cases, the business does not receive a discharge. When a business Chapter 7 is filed, the bankruptcy trustee sells the assets of the business and uses the proceeds to pay creditors. This can be a very attractive option for small business owners who desire to close the business without the hassle of negotiating the disbursement of assets to creditors.
A personal Chapter 7 for a sole proprietor can help close the business and get rid of debts. Or, in the alternative and in the right circumstances, the bankruptcy can get rid of debt and allow the debtor to continue the business free of debt.
Most business owners are not wildly successful on their first try. Often, it takes some rough experiences to figure out the way to succeed. Bankruptcy can offer a way to acknowledge that this particular business isn’t working the way it was supposed to and allows the debtor to make a professional pivot to succeed on the next attempt. Bankruptcy in El Dorado Hills or nearby areas is available for those who need help with their business debts.
Filing for bankruptcy due to credit card or other debt may seem intimidating, but the fact of the matter is it might be the smartest financial decision you will ever make. Bankruptcy gives people the opportunity to have a fresh start on their finances and there are many benefits to filing that you should be aware of if you are considering this as a next option. Here are just a few of the many reasons why filing for bankruptcy is a great thing.
- Gives You a Fresh Start
The first goal of bankruptcy is to offer people a fresh start. If this is something you have been considering, know ahead of time that bankruptcy can reduce stress due to finances as well as erase any debts that you might have had that were weighing you down.
- Gets Collectors off Your Back
Filing for bankruptcy will make it illegal for people to harass you about your debt. They will not be allowed to call you, send letters to your home or place of business, or garnish your wages. When you file for bankruptcy, you will experience a renewed freedom that you might not have had for a while.
- Keep Your House and Cars
When you file for bankruptcy, rest assured that as long as you are current on your mortgage and auto loan payments, if you want to keep those things, you certainly can. Many people worry that their homes and cars will be taken away to pay off debts but as long as you are making payments, you will be fine.
- Put the Past behind You
A bankruptcy filing is in a lot of cases the perfect solution to major financial problems in a person’s life. While many people feel that bankruptcy ruins a person’s credit, we can assure you that what it really does is allows the person to be reborn with new credit and an opportunity to make better financial decisions in the future.
Below represents 3 common reasons you may benefit from filing for bankruptcy sooner rather than later:
1. Stop Foreclosure on Your Home
Filing for bankruptcy will stop the foreclosure process the moment your bankruptcy documents are filed. You will be notified by your bank if they plan on foreclosing on your home. A deadline will be given you to either bring your mortgage current or they will foreclose on a specific date.
2. Stop Your Car from Being Repossessed
If your lender is in the process of repossessing your car, a bankruptcy can help you to stop the repossession and even get your car back after repossession. Chapter 7 and Chapter 13 bankruptcy will both allow you to catch up on your loan payments.
3. Stop a Lawsuit
Bankruptcy will delay or stop a credit card lawsuit. An automatic stay goes into effect that prohibits most creditors from trying to collect debts from you. The effect of the bankruptcy on the lawsuit and debt depends on the claim and type of bankruptcy. If you are being sued by your creditors, filing for bankruptcy relief may help.
Running a business at any time can be difficult and stressful. However, over the last few years, running a business has been nearly impossible. It does not take very many missed or late payments for a business to be in financial trouble. This may leave the owner with few options to get out of debt. One option is to file for business bankruptcy. This is a way for business owners to get out of debt while also allowing the owner to reorganize.
An ambulance operator, Rural/Metro Corp., filed for Chapter 11 bankruptcy protection last week. The company continues to provide ambulance services but is facing substantial debt.
Rural/Metro is based in Arizona and provides emergency services nationwide. The company missed an interest payment in July, which lowered their debt and credit rating. The company filed for bankruptcy in Delaware; they listed their assets and debts at almost $500 million.
It does not take many missed or late payments to cause substantial problems to the business, which then causes many business to face the possibility of bankruptcy. One of the benefits of bankruptcy is that all creditor actions are stopped when the business files for bankruptcy protection. This includes mechanics liens and repossessions.
Bankruptcy also allows the company to create a debt reorganization plan. In many cases, this plan will reduce interest payments. It may also reduce or eliminate penalties or fees that were accumulated under the late or missed payments.
Filing for bankruptcy protection can significantly turn the ability of the business around to allow it to continue to operate. It can provide the business owner needed relief to prevent the loss of his or her business.
Source: Buffalo Business First, "Rural/Metro to continue services after bankruptcy filing," Aug. 5, 2013