Commercial Bankruptcy Case Study
A local candy manufacturer contacted the CGA Law Firm when they were experiencing grave financial problems.
The company was having difficulty keeping up with their bank loans and falling behind on its payments to its vendors. Sales and profitability, which at one time had been robust, were lagging due to both industry-related regulatory changes surrounding nutrition and obesity legislation and the post-2007 economic collapse.
CGA immediately stepped in and began negotiating with the candy manufacturer’s bank and suppliers to work to restructure their payments, which made the debt affordable while the company continued to market its product. As our bankruptcy team researched ways to preserve cash and lower debt payments, they also looked for ways to increase productivity and cut internal expenses. CGA also aided the candy manufacturer in looking for business partners that could have been able to infuse capital or bring new product lines on board through the diversity of marketing efforts.
Since the prospective new business partner and the bank could not come to terms in arranging resolution, we were compelled to assist the company in filing for Chapter 11 bankruptcy. This allowed sufficient time form them to find a buyer on terms that the bank would accept. A sale was approved by the Bankruptcy Court and consummated shortly thereafter.
The candy manufacturer is still a viable and recognizable presence in the York community, and with the infusion of new capital from the buyer, is even stronger now than they had been in recent years. In fact, all 100 employees were able to keep their jobs.