The locally owned newspaper publisher, Western Communications, filed for Chapter 11 bankruptcy in August 2011. Attorney Albert N. Kennedy of the Portland-based law firm of Tonkon Torp LLP is representing the company. Read story by CBN staff.
Chapter 11 bankruptcy is intended primarily for the reorganization of businesses with heavy debt burdens, most often associated with corporations but available to small businesses as well. Chapter 11 allows the debtor to propose a plan for profitability post-bankruptcy, which may include trimming costs and seeking new sources of revenue or income, while temporarily holding creditors at bay.
In contrast, Chapter 7 bankruptcy (often referred to as liquidation) involves the closure of the debtor business and the sale of liquid assets to repay creditors. While Chapter 11 has certain advantages for those that qualify, including more time to file a plan and the opportunity to reorganize, it is more time-consuming and costly than other forms of bankruptcy according to online law websites.
Western Communications Inc. blamed its Chapter 11 filing on its stalemate with Bank of America over an $18 million loan, a debt that it reported it had struggled to repay since the advertising declines of 2007. Included in the Chapter 11 bankruptcy filing is approximately $117,000 owed to several businesses and individuals. In Bend/Redmond the Schedule of Creditors includes the City of Bend, BendTel, Pacific Power, The Printing Post, Phoenix Inn, Lasercharge, Cascade Disposal and Goodyear Auto Care.
These and other creditors received a notice last October to confirm the debt claim by December 29, 2011. Following approval of a proposed disclosure statement by the court, creditors will be sent copies of it, together with a proposed plan and ballots for acceptance or rejection of the plan.
The Schedule of Creditors Holding Unsecured NonPriority Claims also lists shareholders of record including Patricia Moss, Robert Chandler, Janet Stevens, Margaret Cushman, Mary Jean Chandler and Elizabeth McCool.