The operator of Zen Gaming Inc. filed for chapter 11 protection on Friday after struggling to make money with a business model that paid out millions of dollars to online poker players who never gambled with their own money, Dow Jones DBR Small Cap reported today. The 14-worker company tried to make money by running targeted ads on the site. Without profits, the company borrowed money from video poker inventor Ernie Moody, who is now owed about $16.9 million, according to court papers.
School Specialty Inc., a money-losing distributor of non-textbook school supplies including art materials and classroom equipment, filed for bankruptcy protection and put the company on the auction block, Bloomberg News reported yesterday. School Specialty, based in Greenville, Wis., listed $494.5 million in assets and $394.5 million in debt in chapter 11 papers filed yesterday. The company has signed an asset purchase agreement with Bayside Capital Inc. for a proposed sale with competitive bidding supervised by the court, and Bayside will provide a $50 million loan, according to the statement.
Powerwave Technologies Inc., a maker of antennas and amplifiers for wireless communications, filed for chapter 11 protection after losing money in four of the past five years, Bloomberg News reported yesterday. The company, based in Santa Ana, Calif., listed debt of $396 million and assets of $213 million in a chapter 11 petition filed yesterday. The case is Powerwave Technologies Inc., 13-10134, U.S. Bankruptcy Court, District of Delaware (Wilmington).
LodgeNet Interactive Corp. filed for bankruptcy protection with plans to be taken over by affiliates of Colony Capital LLC, which will invest $60 million and work with DirecTV to provide on-demand movies to hotel rooms, Bloomberg News reported today. LodgeNet had about $292 million in consolidated assets and about $449 million in consolidated debt as of Sept. 30, 2012, according to court papers. LodgeNet reported consolidated revenue of about $379 million for the twelve months ending Sept. 30, court papers show. LodgeNet, based in Sioux Falls, S.D., has not posted an annual profit since 2006. Last year, 95 percent of its revenue came from the hotel industry, with Hilton Worldwide and Marriott International Inc. accounting for about a third of sales, according to company filings.
Medical laser manufacturer Biolitec Inc. has filed for chapter 11 protection as it continues to appeal a $23.2 million judgment awarded to a distributor of its products, Dow Jones DBR Small Cap reported today.
AngioDynamics Inc . in November was awarded a "final partial judgment" by the U.S. District Court against Biolitec. AngioDynamics settled the lawsuits for $7 million and $6.75 million each, according to court documents, and sued Biolitec for breach of contract.
Lyon Workspace Products LLC, which makes lockers, metal filing cabinets and storage racks at plants in Illinois and Indiana, filed for chapter 11 protection citing high labor and commodity costs, Dow Jones DBR Small Cap reported today. The company said that it plans to hold an auction to sell the business. Lyon Workspace did not list a sale price in court papers, but estimated its assets were worth between $10 million and $50 million on its bankruptcy petition.
Education Holdings 1 Inc., the test-preparation company formerly known as Princeton Review, filed for bankruptcy protection, a month after settling a fraud lawsuit with the U.S., Bloomberg News reported yesterday. Education Holdings listed liabilities of $100 million to $500 million, as well as $100 million to $500 million in assets, in court documents filed yesterday. The company filed a pre-packaged chapter 11 plan that it said has already received approval from some creditors. Senior secured claim holders, who are owed at least $36.3 million, second-lien facility claimants due $7 million and other note holders owed more than $110 million will be allowed to vote on the plan submitted today as the proposal impairs their claims, according to a court filing.
Atari SA's U.S.-based video-game-making businesses filed for chapter protection with the intention of separating from the unprofitable French parent and seeking independent funding, Bloomberg News reported yesterday. New York-based Atari Inc., maker of video games “Pong” and “Asteroids,” as well as affiliates Atari Interactive Inc., Humongous Inc. and California U.S. Holdings Inc., asked to be jointly administered in filings today in bankruptcy court. Atari was founded in 1972 and became a pioneer in arcade and video games. Today it lags behind game-making giants such as Activision Blizzard Inc., the world’s largest by sales, and Electronic Arts Inc. The move to separate the U.S. business comes after the parent company Atari said in December it was strained for cash. The French parent, which has not made a profit since 1999 despite asset sales and restructuring, forecast a “significant loss” in 2012-2013, and said it would weigh all means of raising cash and had been talking to potential investors. According to its chapter 11 petition, Atari owes $10 million to $50 million to at least 200 creditors and possibly as many as 999. It reported assets of $1 million to $10 million.
Direct Markets Holdings Corp, parent of broker-dealer Rodman and Renshaw LLC, filed for bankruptcy on Friday and said that it would liquidate, Reuters reported yesterday. Direct Markets, along with its affiliates Rodman and Renshaw LLC and Direct Markets Inc, filed a chapter 7 petition. The company listed total assets of $1 million and liabilities of $10.6 million as of Jan. 9. In September, Rodman and Renshaw informed the Financial Industry Regulatory Authority that it was no longer in compliance with regulatory capital rules and would cease conducting its securities business. Direct Markets was previously Rodman and Renshaw Capital Group Inc, a small investment bank. It changed its name in May to focus on developing financial technology applications and operating the DirectMarkets platform.
Handy Hardware Wholesale Inc., a dealer-owned wholesale group with more than 1,000 members in 14 states, filed for chapter 11 protection from its creditors, Bloomberg News reported on Friday. The company listed both assets and debt of $50 million to $100 million in chapter 11 documents filed on Friday. The company, based in Houston, was founded in 1961 by 13 independent hardware retailers in Houston. American Water Heater Co., owed $1.4 million, is listed as the largest creditor without collateral backing its claim.
