Wireless Payment Technology Innovator Creditel Files Chapter 11 Petition
On July 13, 2007, Virtual Fonlink, Inc. d/b/a Creditel filed a voluntary petition for relief under Chapter 11 of the Bankruptcy in the United States Bankruptcy Court for the District of Delaware. This case is pending before Chief Judge Mary F. Walrath.
According to the debtor’s declaration in support of its first day motions, the debtor provides technology for secured wireless credit transactions. The debtor’s flagship device permits credit cards to be swiped on enabled mobile phone devices. In recent years, this technology was updated to work with Bluetooth devices.
The bankruptcy case was prompted by a default under its credit facility with a lender holding a lien on substantially all of the debtor’s assets. The debtor’s secured lender noticed a foreclosure sale of the debtor’s assets for July 13, 2007, triggering this bankruptcy filing on that date.
Finding the market for financing all but dry, the debtors are proposing debtor-in-possession financing to come from junior lienholders of the debtor, including two who are members of the debtor’s board of directors.
