[itafroma]

> Correction, this is chapter 11 bankruptcy. This isn't the same as standard bankruptcy. This is the same kind of bankruptcy that 50 Cent is going through. It doesn't mean you have no money, it allows you to reasses your finances and protects you.

While it's relatively common for people to associate the word "bankruptcy" with the "we ran out of money so we need to liquidate any assets we have left and walk away from our debts" (Chapter 7) or "we can't pay our debts on time so we need a payment plan" (Chapter 13) types of bankruptcy, and it is true that 50 Cent also filed a Chapter 11 bankruptcy, it's a bit disingenuous to say that it doesn't mean they don't have any money.

A Chapter 11 bankruptcy is a tool to protect a debtor's assets and give it time to come up with a plan to pay back its creditors: in this case, the plan proposed by Quirky is to sell off all of those assets at auction so that it can raise enough money to pay off its debt. The Chapter 11 filing is being used as a way to say to potential buyers "don't worry, these assets won't be taken from the company before the sale can close."

They are otherwise very much broke and are counting on the sale to raise the money to pay off their debts. If they can't sell quickly enough, it'll likely convert into a Chapter 7 bankruptcy.

Here's a good overview of what's going in: http://www.frostbrowntodd.com/resources-1562.html