Power Balance, the company whose name is emblazoned on the Sacramento Kings' arena, has filed for bankruptcy protection and could be forced to repay tens of millions of dollars to customers who bought its popular silicone bracelets.

It's not clear what impact the Chapter 11 bankruptcy reorganization filing will have on the Kings or their quest for a new arena, but the news comes at a bad time for the team, which has been idled by an unpopular NBA lockout.

A list of Power Balance debts filed with the bankruptcy court includes $100,000 owed to the Kings. The team is listed as an unsecured creditor, meaning it will take a back seat to secured creditors in recovering any money owed by Power Balance.

Officials with both the company and the Kings said Monday that they expect to continue their business partnership. The financial terms of Power Balance's five-year deal with the Kings have not been released.

"It is business as usual, and Power Balance continues to be a happy supporter of the Kings and the Sacramento community," Power Balance spokesman Jason Damata said.

Kings spokesman Chris Clark said the company has "assured us of their commitment to the Sacramento Kings and the surrounding community, and we expect to continue our productive partnership through this process and into the future."

The former Arco Arena was renamed Power Balance Pavilion in March. That deal ended a 25-year relationship the Kings had with Arco that paid the team $750,000 a year.

Just weeks before the agreement was reached, Power Balance was sued by customers alleging that it falsely claimed that its bracelets improved athletic performance. At the time, Kings officials lauded the naming rights deal, with team co-owner Joe Maloof saying it was "a big win for the franchise."

In September, Power Balance agreed to settle a class action lawsuit filed in federal court in Los Angeles. Under the terms of the settlement, which is not yet finalized, anyone who bought a wristband would be eligible for a refund of the $30 purchase price, plus $5 for shipping, according to federal court documents.

If every customer who has purchased a wristband demands a refund, the settlement could cost Power Balance $57.4 million, according to Kevin Boyle, an attorney with Panish, Shea & Boyle and the plaintiffs' lead counsel on the case.

A hearing to finalize the settlement was scheduled for Monday, but was canceled after the Chapter 11 filing.

Last year, an Australian sports authority ordered Power Balance to admit there was "no credible scientific evidence that supports" claims that the wristbands improve athletic performance.

In a statement released Monday, Power Balance denied a report by the website TMZ that the company would close. "Restructuring will allow Power Balance to focus on the design and development of new performance technology products and will put the company on better ground," the statement read.

The company has experienced "a handful of growing pains" as a result of its popularity, including "a number of class action lawsuits," the statement read. Those suits have cost the company millions of dollars.

In documents filed in bankruptcy court, Power Balance estimates that its debts total between $10 million and $50 million, while its assets are somewhere between $1 million and $10 million.

Power Balance wristbands – which have been worn by several high-profile athletes, celebrities and even Mayor Kevin Johnson – have been marketed for improving balance and athletic performance. Power Balance was founded by Troy Rodarmel, a former surfer from Orange County, and his brother Josh.

While terms of the Power Balance deal with the Kings have not been disclosed, naming rights agreements typically involve teams receiving payments spread out over time, often in increasing increments, said David Carter, executive director of the Sports Business Institute at the University of Southern California.

Carter said the Power Balance Chapter 11 filing "certainly doesn't bode well" for the Kings' image. Still, he said, "all parties involved were aware of Power Balance and its challenges as the deal was being constructed."

"While this isn't a welcomed development, the Kings certainly face more daunting challenges in the months to come," Carter said.

City officials are working on a financing plan to replace Power Balance Pavilion with a new downtown sports and entertainment complex. The City Council is expected to vote on elements of the $387 million project next month.

If no plan is in place by March 1, the Maloofs, who own the Kings, says they plan to move the team.

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