Theater Seat Maker Abandons Chapter 11 Plan in Light of Virus

VIP Cinema Holdings Inc. has been forced to walk away from its proposed Chapter 11 reorganization because the coronavirus has shut down movie theaters, the luxury electric theater seat maker told a Delaware bankruptcy judge.

The company April 3 asked the U.S. Bankruptcy Court for the District of Delaware for permission to make severance payments of about $625,000 total to some 297 employees—excluding management and owners—who were recently laid off.

VIP had to terminate its plans to sell the company as a going concern business and instead will have to liquidate its assets, the company said. Government orders closing movie ...