Even if you are not a football fan, chances are you have heard of Michael Vick. Vick was enjoying wealth and fame as a star quarterback in the National Football League, until authorities discovered that he was running an illegal dog fighting ring. Vick served 18 months in a federal prison, lost his fame and fortune, and filed bankruptcy. While most individuals who file for bankruptcy file either a Chapter 7 or Chapter 13, Michael Vick filed a Chapter 11 bankruptcy.
As it goes in this land of opportunity, the Philadelphia Eagles gave Vick a job after his release from prison, and recently he had one of the best games by a quarterback in NFL history. During a Monday Night Football game in front of a national television audience, Vick accounted for 413 yards of total offense and six touchdowns.
This is obviously good news for the Philadelphia Eagles, and Michael Vick, but it is also good news to Vick's creditors.
Vick is playing under a one year contract during 2010 which Fox Sports reports is worth $3.75 million in base salary, a $1.5 million roster bonus which was paid in March, and possible performance incentives of over $2.7 million. According to the terms of his bankruptcy plan, Vick is able to keep $300,000 of this salary while the rest goes to repay $20 million in debt and administrative expenses. Vick's confirmed Chapter 11 plan pays his creditors on a scale of 10% - 40%:
Vick's Earnings Percentage to creditors
0 - $750,000 10%
$75,0001 - $250,000 25%
$250,001 - $10,000,000 30%
$10,000,001+ 40%
The repayment period is January 1, 2010 through December 31, 2015. Vick's recent record setting performance and continued success in the NFL could mean a multi-year contract. This gives creditors reason to smile.
CNBC reports that Andrew Joel is one creditor who is taking an active interest in Vick's on-field success. Joel's company, Joel Enterprises, sued Vick on a breach of contract issue and is owed $6 million. Joel told CNBC, "I don't think I'll get all of my money back, but I now think I'm getting more than I originally thought." Joel stated that while he has yet to see payment through the bankruptcy, he expects money in the future. However, "the bankruptcy lawyers and the Atlanta Falcons are in line before me," he said.
While Michaels Vick's specific financial troubles are quite unique (debt levels, salary, etc.), many Americans are also experiencing financial troubles as a result of one of the worst economies in history. The bankruptcy laws are designed to help everyone who may be experiencing significant financial hardships get out from underneath the burden of crushing debt, and get back on the road to financial freedom.
If you are experiencing financial troubles as a result of overwhelming debt, contact the experienced Chicago bankruptcy attorneys at Glanzer & Angres, P.C. at 1-877-337-2227 to discuss how the bankruptcy laws may be able to help you, and to schedule your free, in-person consultation.