Prime Time International Files for Chapter 11 Reorganization
Will continue to operate in ordinary course of business
PHOENIX -- Prime Time International Co. and its related companies, a national leader in the machine made cigar and energy shot markets, has filed voluntary petitions for relief under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the District of Arizona.
The company filed on March 15, 2014. It will continue to operate its core businesses in the ordinary course, while taking steps to obtain alternative funding sources to emerge from Chapter 11 as a stronger and more competitive company. The company will continue its operations with the cooperation of its bankers under Chapter 11 protection, which will enable it to continue to operate its businesses.
Due to its efforts to internally finance product diversification over the past several years, and an assessment dispute with the U.S. Department of Agriculture (USDA), the company's relationship with its bankers was complicated to a point where they refused to renew certain important loans, although Prime Time International has never been late with any of its loan payments since its credit facility was established in 2005, it said. As the result of these circumstances, the company decided to seek court protection to ensure that there will be no interruption in either product flow or overall supply-chain relationships in order to continue to provide products to its customers.
The company has filed various motions with the court in support of its reorganization, including motions for continued approval of exiting customer programs, insurance and continued payments of suppliers and employees in the ordinary course after the filing date. It has paid its key suppliers current prior to the filing.
The company plans to continue with its planned trade shows, marketing and rebate programs and existing customer return policies.
John T. Wertheim, chairman of the board and CFO of Phoenix-based Prime Time International, on behalf of himself and the company's key executives, reaffirmed the company's intent to honor its customers' dedication by continuing to supply and support quality tobacco and energy products. Wertheim stated his appreciation for the company's customers, suppliers and employees, "all of whose continued support will be critical to the future of the business."