Creative Memories parent company The Antioch Company filed for voluntary Chapter 11 bankruptcy protection yesterday (April 16th) for the second time in less than 5 years. Petitions are also pending for the company’s six subsidiaries and affiliates. The cases are being handled jointly by the court.
The company had previously filed Chapter 11 bankruptcy in November 2008. That bankruptcy case was closed in early 2009, but a lawsuit brought by former employee shareholders who lost their retirement in the bankruptcy is still pending against various company executives.
According to the bankruptcy filing, The Antioch Company has in the range of $10 million to $50 million in debt, and in that same range of assets. The company claims to have somewhere between 10,000 and 25,000 creditors – a huge number (even for a corporate bankruptcy) that is obviously swelled by Creative Memories’ large network of consultants. The company has more than 20,000 consultants worldwide, and any consultant still owed a payment on the date of the bankruptcy filing is now a creditor of the company.
Among the top 30 unsecured creditors of the company, some names are familiar to those in the scrapbook industry. Adhesive manufacturer 3L is owed $350,000. Nancy O’Dell, through her company Nancy O’Dell Enterprises, is also owed over $260,000, presumably for the work she did on her signature line for Creative Memories. As in the previous bankruptcy, the majority of the company’s top 30 unsecured creditors are listed as “benefit plan participants”, meaning they are former employee shareholders who are owed buy-outs of their shares after leaving the company or being laid off.
As part of their bankruptcy filing, The Antioch Company also filed several “first day” motions requesting orders they need from the court to continue operating while in bankruptcy. Most of the orders are fairly routine, requesting access to bank accounts and other assets and the right to continue paying payroll. Two motions stand out, however. [Read more...]