Family Christian Stores has received the approval the chain sought to move forward with an August vote on its plan to move out of Chapter 11 bankruptcy.

Judge John Gregg, who originally nixed the plan due to allegations of insider dealings, has approved the creditor vote, which will end Aug. 7. If creditors vote to approve the plan, the nation's largest Christian retail chain would begin the transition to new ownership.

The August target date is crucial for the chain, which is attempting to position itself well for the Christmas shopping season. Many vendors and distributors have refused to deal with Family Christian until it emerges from Chapter 11 protection, while others are demanding cash up front, Family Christian lawyer Brad Baldwin told mlive.com.

Family Christian Acquisition, headed by Atlanta businessman Richard Jackson, who also chairs Family Christian Stores, placed the winning bid for the retail chain in a recent auction, but charges of impropriety in the proceedings were brought by the second-place bidder, who is no longer a part of the process. Judge Gregg agreed in a June 19 ruling, canceling the winning status of the bid. An affirmative vote by a sufficient majority of the creditors could essentially overturn that decision and allow Family Christian Acquisition's bid to succeed.

One element of Family Christian Acquisition's bid that was reportedly attractive to creditors was the bidder's intentions to keep the vast majority of Family Christian's 266 stores open and operating, which could prove beneficial to Family Christian Stores and its vendors with the Christmas shopping season fast approaching.

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