Not too many years ago the news media announced that Hostess was filing Chapter 11 Bankruptcy. I don’t know how you felt about it, but for me personally, I could not imagine my favorite Hostess product was going away. I loved Twinkies growing up as a kid, and even though I did not eat them as much as an adult, a Twinkies always gave me a trip down memory lane. Apparently I was not alone. Making that mad dash down to the local grocery store, just so I could grab a couple of boxes, only to be greeted by empty shelves. If you check our website out, we give a brief description of what a Chapter 11 looks like.
The objective of filing Chapter 11 bankruptcy vs. Chapter 7, is to become profitable. Creditors have more motivation to work with the debtor and negotiate with a debtor in Chapter 11, since if it were a Chapter 7, generally creditors would not get better terms.
The reorganization plan puts creditors into different classes on how their claims are going to be handled. State and Federal tax agencies are considered first priority and employees owned wages and stockholder interests are each put into their own class. Each and every secured creditor is placed in its own class, whereas unsecured claims are placed together in one class. The plan itself may modify the amounts and terms for repayment of debts to these creditors and must have court approval.
Once again Twinkies, along with the iconic favorites, are back in the households.
Hello, Again..The Return of Twinkies
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