PHILADELPHIA -- Wall to Wall Sound and Video Inc. Friday filed for Chapter 11 bankruptcy in U.S. Bankruptcy Court, the company said.
Company president Jerome Shulman said the bankruptcy petition was filed to head off creditors who were demanding immediate repayment of loans to the home entertainment chain.
The company had been in discussions with certain of its lenders regarding some provisions of its line of credit, but the company and lenders were unable to resolve the matter, he said.
Shulman said the bankruptcy will give his company breathing room to phase out the unprofitable parts of its operation, including closing some of the chain's 88 branches in six mid-Atlantic states. The stores are operated under the Wall to Wall Sound and Video and Listening Booth names.
The company said the chain's cash flow problems stem from poor sales and costs connected with a recent expansion.