Sweet Onion Trading to file motion for post-petition payments
Sweet Onion Trading to file motion for post-petition payments
The attorney for Sweet Onion Trading Corp. in Grant, FL, was expected to file a motion Jan. 8 to give post-bankruptcy creditors assurances that the company will pay its new debts in a timely manner as it reorganizes under its Chapter 11 petition.
The firm filed for bankruptcy protection Dec. 24 with the goal of moving forward, and in fact, it has continued to operate since that date.
Attorney Kenneth B. Herron of Wolff Hill McFarlin & Herron in Orlando, FL, told The Produce News that Sweet Onion Trading owes PACA Trust Claim creditors approximately $468,000, and he fully expects those claims to be paid in full during the reorganization.
In addition, the company has about $540,000 in bank debt and another $750,000 in unsecured debt. Herron said through the courts that the firm will determine a plan for relieving itself of those debts.
Herron announced that a post-petition agreement has been reached with the Michael Cutler Co., an onion grower-shipper headquartered in Olyphant, PA, for that firm to provide financing and back-office accounting help to pay post-petition creditors within 21 days. The attorney was planning to file the motion approving this agreement with the bankruptcy court the afternoon of Jan. 8.
Herron said Sweet Onion Trading is working on its reorganization plan and expects to file that with the court within 90 days. The company has said that it has not fully recovered from the recession of 2008, which led to the Chapter 11 filing. The firm’s business has dropped each of the last several years but it still did almost $4 million in sales last year.
Sweet Onion Trading Corp. is largely an onion marketing firm, and its PACA creditors are mostly onion suppliers. Herron said the vast majority of the unsecured debt is also claims from produce companies that for one reason or another did not qualify for PACA Trust protection.