Popular Woodworking: Notice of Chapter 11 Bankruptcy: I'm a Creditor

[Bob Lang]

I also got one and I assumed it is because I have regularly contributed to them and may be owed something.

It looks like contracted authors are on "the list" (it's pretty lengthy) of creditors, must of whom will be SOL. Check your contract, there should be a clause that if they go belly-up you get your publishing rights back. They separated books from magazines a few months ago, so if someone buys the books division they should also assume the responsibility of paying any royalties owed.

Even in the best of times authors are last in line to get the smallest piece of the publishing pie. In this case they say they are still operating normally, but how long can that last?

[Bibliophile 13]

Since they are filing for chapter 11 bankruptcy and not chapter 7, I assume that they're still operating as a business. My knowledge of these things is limited, but it's my understanding that chapter 11 gives the still-operating business some legal oversight/protection as it attempts to renegotiate its debt repayments. The goal with chapter 11 is to emerge from bankruptcy and go back to normal operations. (Chapter 7 bankruptcy is the real death-knell, and when it happens, the court just divvies up the remaining assets between the various creditors.) What chapter 11 means right now is that creditors will have to wait longer for repayment, but that F+W could still be a viable business.

Some companies do emerge successfully from chapter 11, but of course many do not. At this point, it's a wait-and-see situation.

For myself, I was planning to let my subscription run out anyway. For one, the magazine has cheapened (even down to the paper it's printed on). I do still enjoy some of the remaining features, especially Flexner, Walker, and Follansbee. Zach's articles and similar hand-tool content have been great, too! But I'm no longer as interested as I was in learning new tricks and techniques. I have the tools I need, and I've gained some reasonable skill--what I need now is not more information but more practice. And if I ever do want to take my skills to the next level, I'm going to be buying specialized books, not magazines, in order to get there.

[Admiral]

Since they are filing for chapter 11 bankruptcy and not chapter 7, I assume that they're still operating as a business.  My knowledge of these things is limited, but it's my understanding that chapter 11 gives the still-operating business some legal oversight/protection as it attempts to renegotiate its debt repayments.  The goal with chapter 11 is to emerge from bankruptcy and go back to normal operations. (Chapter 7 bankruptcy is the real death-knell, and when it happens, the court just divvies up the remaining assets between the various creditors.)  What chapter 11 means right now is that creditors will have to wait longer for repayment, but that F+W could still be a viable business.  

Don't hold your breath; I did creditor work for 25 years, and private equity filings for this type of "amalgamated" media company rarely come out of chapter 11 without selling off various parts of the business that have demonstrable value (called Section 363 sales), and without the details its hard to say if the Popular Woodworking franchise in particular is worthy enough to attract such buyers.  After all the PE guys bought this company to flip it after 'improvements' that they weren't able to pull off, and as Bob noted, once they realized their plan was not happening, they were constantly trying to sell it as a whole concern but nobody was biting (called 'putting lipstick on the pig').  So I'll predict some series of partial sales to the point where what is left is either viable (with the secured debt taking a haircut and the unsecured (e.g., the authors) getting $0.10 on the dollar), or cannot attract serious buyers, and then conversion to a Chapter 7 liquidation when its a real fire sale.  Bankruptcy court is like the wild west, everybody trying to make a deal - generally the equity holders and secured debt holders - so we'll see what happens as the permutations and combinations are endless.

[hbmcc]

It's sad to see this magazine fade, but this process of failure(?) is quite interesting to follow! Thanks to Admiral for the interpretations.

An interesting spinoff is to have watched Lost Art Press evolve while F&W crumbled. The business plans are starkly different.

[Handplanesandmore]

Publishing books and publishing magazines are two different ventures enough that the latter faces more challenges, one of which is the challenge to meet readers' expectations once every two or three months on an ongoing basis. If you publish a magazine that comes out only once or twice a year, the story is different.

Simon

[Downwindtracker2]

Lee Valley tried publishing a magazine , I think it was called Wood Cuts. They were crying for articles, in fact I think that was why they said they gave up.

[Skip J.]

For myself, I was planning to let my subscription run out anyway.  For one, the magazine has cheapened (even down to the paper it's printed on). I do still enjoy some of the remaining features, especially Flexner, Walker, and Follansbee.  Zach's articles and similar hand-tool content have been great, too!  But I'm no longer as interested as I was in learning new tricks and techniques.  I have the tools I need, and I've gained some reasonable skill--what I need now is not more information but more practice.  And if I ever do want to take my skills to the next level, I'm going to be buying specialized books, not magazines, in order to get there.

Hello Steve;

This why I let mine run out last year..... and I haven't missed it. That little bit of extra time has turned out to be useful. I bought one of the LAP books and have been working on it a little bit along...

No regrets here..

[Arlin Eastman]

If their site is down, then it is a sure sign of closure.

I remember people complaining about AMC which kept its magazine (such as woodturning design) subscription page alive even when it had decided to close business. Their authors had not been paid for several issues back when they were still accepting new subscribers.

Simon

I am still mad about Woodturning design..

I had my check in the mail when they folded and they cashed it anyway when they got it afew days later.  To me that is scam worthy

[Stwood_]

I guess there is no point in hiring a attorney specializing in woodworking cases. I mean, I do not even think that there could actually be such an attorney.

Probably not. Bye