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Nashville, Tenn.-based used car chain Auto Masters has filed for bankruptcy in federal court, claiming a change in Capital One’s lending policies undercut its “buy here, pay here” model, the Nashville Post reported yesterday. A meeting with creditors is scheduled for Nov. 17 at the Customs House in Nashville. “It’s unfortunate that Auto Masters’ primary lender decided to exit this market, but fortunately Auto Masters can survive without this continued funding,” said Griffin Dunham, an attorney with Dunham Hildebrand representing the various entities that make up Auto Masters. The several Auto Masters entities are liable for $47 million from Capital One and $16 million in associated financing from First Tennessee Bank. Some are also liable to another bank for $8 million.

Cardiac Connection Home Health Care Nursing Services Corp., a Chesterfield County, Va.-based business, filed for chapter 11 protection on Monday, but the lawyer representing the company said the business plans to continue operations, the Richmond Times Dispatch reported today. The home health company, which has 12 employees, provides care to patients after they have been released from the hospital with serious cardiac issues, according to Robert Westermann, an attorney with Hirschler Fleischer who is representing Cardiac Connection. But the company has some “obligations that just need to be restructured” through chapter 11, Westermann said, including its Medicaid and Medicare billings. They needed to be able to “address all these creditor claims in one forum, rather than putting out several different fires from different creditors,” he said. In U.S. Bankruptcy Court in Richmond on Wednesday, Westermann said, the company was granted authority to continue to meet all its payroll obligations and to continue to use receivables that are collected from the government from Medicare and Medicaid. In its filing, Cardiac Connections listed its estimated assets as between $100,001 and $500,000, with its estimated liabilities between $500,001 and $1 million. Read more. 

For more on hospital and health care insolvencies, be sure to pick up a copy of the ABI Health Care Insolvency Manual, Third Edition from the ABI Bookstore. 

The owner of casual Italian dining chain Romano’s Macaroni Grill filed for bankruptcy protection yesterday with a plan to slash it debt and to reorganize around its top restaurants, the Wall Street Journal reported. The chain’s parent company and a handful of affiliates, including investment vehicle Mac Acquisition LLC, filed for chapter 11 protection in U.S. Bankruptcy Court in Wilmington, Del. In court papers, Chief Executive Nishant Machado blamed the chain’s financial woes on the downturn in the casual dining industry as customers have shifted to cheaper, faster alternatives. The chain owns 93 restaurants in 23 states and employs approximately 4,600 people. It brought in revenue of approximately $230 million last year. RedRock Partners, LLC bought the chain for $8 million in 2015. Since then, Machado said, the company has struggled to service its debt. So far this year the chain has closed 37 unprofitable restaurants.

Privately-held GST AutoLeather and five affiliated Debtors filed for chapter 11 protection with the U.S. Bankruptcy Court in the District of Delaware, BankruptcyData.com reported yesterday. The company, which supplies automotive leather products, has obtained a commitment from its senior secured lenders for a $40 million debtor-in-possession facility, the proceeds of which will be used to fund ongoing business operations. This facility will allow GST to continue business as usual during the reorganization process, while pursuing a court-supervised going concern sale. 

U.S. paper maker Appvion Inc. and some of its subsidiaries said that they filed for chapter 11 protection yesterday, Reuters reported. Appvion listed assets in the range of $100 million-$500 million and liabilities in the range of $500 million-$1 billion, the Delaware bankruptcy court filing showed. The company said that it has obtained a commitment for $85 million in new debtor-in-possession financing from a group of its first lien lenders. Appvion, headquartered in Appleton, Wis., and owned by its employees, said in June it had hired investment bank Guggenheim Partners LLC to address its $440 million debt load amid declining sales due to consumers’ switch to electronic communications. The company has a revolving credit line due in 2018 with its term loan due in the following year which could put Appvion under further financial strain, according to an assessment from credit rating agency Moody’s Investors Service. The company’s net sales fell to $164 million in the quarter ended July 2, from $173.6 million a year earlier.

After closing a string of locations in recent months, the corporate owners of the Chubby’s Tacos restaurants has filed for chapter 11, the Charlotte (N.C.) News & Observer reported today. Kairos LLC, the corporate owner of the Triangle, N.C.-based chain Guacamaya Fresh Mex, filed for Chapter 11 protection on Sept. 11 in the U.S. Bankruptcy Court for the Eastern District of North Carolina. Chapter 11 bankruptcy filings let a business reorganize its debts and assets, rather than ceasing operations entirely. The chain reported having nearly $190,000 in assets and almost $2.3 million in liabilities in its bankruptcy filing. Sales at the chain fell nearly 11 percent from 2015 to 2016, going from $3.7 million to $3.3 million.

Toys ‘R’ Us Inc. filed for chapter 11 bankruptcy protection yesterday, undone by a hefty debt load and the rapid shift to online shopping, the Wall Street Journal reported today. As part of the restructuring process, Toys ‘R’ Us plans to close some underperforming stores. Its remaining locations would be reconfigured to be more experienced-based, incorporating amenities such as in-store play areas. The company expects most of its stores will be open for the holidays and it will use $3 billion in bankruptcy financing to continue buying merchandise and funding its operations. The company, which operates about 1,600 stores around the world, was a classic example of a “category killer,” a huge specialty store with low prices that squeezed independent shops. It swallowed up several rivals that have themselves filed for bankruptcy protection, including FAO Schwarz and Kay Bee Toys, a mall-based chain that liquidated hundreds of stores before it was sold. Read more. (Subscription required.) 

What does the future hold for retail bankruptcies? Be sure to attend ABI’s Bankruptcy 2017: Views from the Bench on October 17. 

The maker of Aerosoles flexible-sole footwear filed for bankruptcy as it looks to sell or refinance around its e-commerce unit, Bloomberg News reported on Friday. AeroGroup International, established in 1987 through a buyout of a Kenneth Cole division, estimated around $109 million in debt as of Friday’s chapter 11 filing, and said that it plans to continue evaluating store closing. It operates 78 stores across the U.S., after closing around 30 in 2016. The New Jersey-based footwear maker seeks a proposal to buy or finance a business around its wholesale and e-commerce units. “Declining mall traffic, a highly promotional and competitive retail environment, and a shift in customer demand and preference for online shopping versus the traditional brick and mortar environment” all contributed to Aerosoles’s declining fortunes after more than 30 years of profitable operations, Mark Weinstein, the company’s chief restructuring officer, said in a court filing. The company said it wants a proposal within 60 days to exit chapter 11 by the end of the year.

Technology-products distributor WYNIT, which closed its Greenville, S.C., headquarters unexpectedly Aug. 25, has filed for bankruptcy, citing more than $106 million in outstanding debts, the Greenville News reported today. Top among the now Minnesota-based company's creditors is Fitbit Inc., at $31 million. Chief Operating Officer Pete Richichi filed the paperwork in Minnesota bankruptcy court on Sept. 6. He and WYNIT's president and founder, Geoffrey Lewis, are listed as 50-50 owners of the enterprise. "Due to a number of unexpected financial issues combined with a disappointing holiday selling season, WYNIT Distribution LLC announced a reorganization today that will close its Wholesale Distribution Division based locally," a statement from the company said at the time. WYNIT Distribution was a marketing, distribution and logistics company that launched in 1987. With operations in Minnesota, Tennessee, Nevada and Ontario, the company delivered high-tech goods such as 3-D printers, drones and software to companies around the country.

Vitamin World Inc., a specialty retailer formerly owned by vitamin manufacturing giant Nature’s Bounty, filed for chapter 11 protection on Monday with a plan to close dozens of its underperforming stores, the Wall Street Journal reported. The vitamin and supplements seller said in court papers that it has identified 51 stores it intends to close as part of its restructuring under chapter 11. Vitamin World, which operates some 334 stores, blamed its bankruptcy on “significant supply chain and ingredient availability disruptions” along with “above-market rents and underperforming retail stores,” in papers filed with the U.S. Bankruptcy Court in Wilmington, Del.