19 May 2015

A Belated Family Christian Stores Update

Between grading and packing my office I haven't followed the Chapter 11 bankruptcy of Family Christian Stores as closely as I would like. (For earlier posts go here, here, here, and here to catch up.) You can read the latest news by reading Jim Harger's piece here.

In short, the consignors, who believe they own a large chunk of the goods for sale at the Family Christian Stores locations, and the FCS itself, have agreed to let the successful buyer at the auction coming this Thursday have their stuff. The consignors aren't giving up their claims to ownership, however. Instead, FCS is posting a bond that will pay the consignors the cash equivalent of their goods if they ultimately prevail with their claim. If they lose, the bond will be discharged and whoever is posting the collateral for the bond will get it back.

Which raises the question: Who is putting up sufficient collateral to get a bank or other financial institution to issue the bond? My guess--and it's only that, a guess--is that it's Richard Jackson. Jackson, you may remember is in effect the owner of FCS and one of its largest secured creditors. He may also be the buyer at the auction.

In any event, stay tuned. Thursday's auction will be far from the end of the FCS bankruptcy saga.

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