In a typical Chapter 11 bankruptcy case, a company gets a "timeout" and will attempt to work out a plan to pay back creditors. If it can't do that, everything is sold, with proceeds going to pay creditors first and shareholders last. Baxano already paid its secured creditor, Hercules, with money received from the asset sale at the end of January. It now owes about $20 million to a long list of unsecured creditors.
Normally this would be very good, but Baxano no longer has any products on the market, and most of the key staff members are gone. It seems like the remaining order of business is to sell what's left and close up shop forever.
Now, it's possible there could be a restructuring, and since Baxano paid Hercules, current shareholders could see some equity retained. This seems very unlikely though -- there's been no evidence so far.
I will say, though, that I find it a little odd Baxano asked for more time in this case when all signs are pointing to Chapter 7. Time to consider restructuring? Nobody knows.
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