A massive food company now files for bankruptcy in Florida defaulted on a bank loan, according to court papers.
One Fat Frog, which claims to be the nation’s largest food truck manufacturer, on May 24 filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Middle District of Florida facing several lawsuits for alleged failure to deliver products that customers had paid for.
The Orlando, Florida-based debtor listed $1 million to $10 million in assets and liabilities in its petition.
It listed over $4.8 million in unsecured claims, which include debt owed to vendors, merchant cash advances and a court judgment.
The company is facing financial problems as in the past year it has been sued a dozen times from creditors demanding payments or customers claiming One Fat Frog allegedly failed to deliver their mobile kitchens after several requests, Orlando ABC television affiliate WFTV-9 reported.
Memphis, Tennessee-based First Horizon Bank is a plaintiff in one of the lawsuits filed on April 25 in the Ninth Judicial Circuit Court of Florida seeking an order requiring the debtor to hand over a mobile kitchen trailer whose security the bank claimed possession of after a One Fat Frog customer defaulted on a bank loan, according to court papers.
Billy & Jo Creole Cooking of Youngsville, La., in April 2023 secured a $69,299 loan from First Horizon to purchase a mobile kitchen trailer from One Fat Frog and granted the bank security interest in the mobile kitchen trailer, according to the lawsuit.
Billy & Jo Creole had reached an agreement with One Fat Frog in April 2023 that called for the kitchen trailer maker to use proceeds from the loan to purchase a trailer and convert it to a mobile kitchen for Billy & Jo Creole.
After converting the trailer, One Fat Frog was required to send the trailer to Billy & Jo Creole, but never delivered the trailer after several requests from the customer, court papers said.
Without the trailer to be used to generate revenue, Billy & Jo defaulted on its loan, and First Horizon sought to take possession of the trailer from One Fat Frog.
First Horizon sent a written demand to One Fat Frog on February 16 demanding return of the trailer to the bank, but the debtor has refused to deliver the trailer to the bank, according to court papers.
The bank filed a lawsuit on April 25 consisting of two counts, replevin of the trailer and civil theft.
The bank seeks return of the trailer in the replevin count and trebel damages, prejudgment interest, attorneys fees and costs and any any such further relief the court deems just and proper in the civil theft count.
One Fat Frog’s bankruptcy attorney did not immediately respond to a request for comment, reports TheStreet.
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An essential company now files a surprising bankruptcy after miscalculating demand for its inventory after the Covid-19 pandemic.
Supply Source Enterprises, a leading provider of branded and private label cleaning products and personal protective equipment, on May 21 filed for Chapter 11 protection to seek a sale of its assets.
Supply Source brands include The Safety Zone and Impact Products.
The Guilford, Connecticut debtor listed $50 million to $100 million in assets in its petition and $180 million in funded debt, which includes $80 million owed on a term loan credit facility, $60 million owed on an asset-based loan, and about $40 million in unsecured debt.
Before the Covid-19 pandemic, which generated huge demand for cleaning supplies and personal protective equipment in 2020, Supply Source had been consistently profitable with stable single-digit growth, according to a declaration from the debtor’s Chief Restructuring Officer Thomas Studebaker.
Once the pandemic hit in 2020, the debtor had substantial growth due to high demand for safety, hygiene and sanitation products
The debtor reported adjusted Ebitda of $93 million in 2020 which was nearly a 300% increase over the previous year.
However, the company’s financial performance deteriorated in subsequent years.
Based on the unprecedented demand in 2020, the company commissioned an industry study in early 2021 that concluded that the Covid-19 pandemic would fundamentally change the cleaning supplies and protective equipment industry and market for its products.
The study also estimated that the company’s Covid-related growth would likely be sustained through 2024.
In contemplation of continued customer demand at elevated prices, based on the study’s data, the debtor increased purchases of inventory even though the costs were higher due to supply chain constraints during the pandemic.
Despite the study’s assurance that growth would be sustained for years, the pandemic’s positive effect on the market faded by the end of 2021 and demand for PPE decreased to normal rates, reports TheStreet.
The reduction in demand led to large amounts of excess inventory that the company could not sell in the same quantities and prices.
The excess inventory forced the debtor to secure additional storage space, which increased storage costs.
These factors tightened the company’s liquidity and led to a decline in annual revenue in 2023 by 26% from 2022, resulting in a negative 2023 Ebitda of $13 million.
The debtor’s liquidity issues led to it being overdrawn on its asset-based loan facility by $30 million.
The ABL lender in February 2024 swept the debtor’s bank accounts, further impacting the company’s financial distress.
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Also Read: This Massive Mall Retailer Is Now Closing In California
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About The Author
There’s a lot more to this story. I was a personal friend of Connie Baugher, President at One Fat Frog from February 2024 to November 2024 when I cut ties with her because I had a gut feeling something was very wrong. During our friendship, she was obsessed with online dating and sex. She hired many psychics and even had me pay one for her because she didn’t want her ex or kids to know she was still getting readings. She would get multiple vitamin IV infusions at $150 each as well as permanent makeup on her eyes and lips. She also got Botox & fillers on her face and even went to a consult for plastic surgery. She spent money like it was no big deal. We can only surmise that she did this with the monies that were supposed to be building food trucks and paying creditors. I have text messages, voice messages and photos to back up my comments.
Woah..
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