Kimesha Lake, NY – The assets of Leisure Time Spring Water will be sold to a Canadian company that promises to preserve most of the company’s 50 jobs, thanks to a last-minute deal reached Friday afternoon in U.S. Bankruptcy Court.
Boreal Water Collection, a company based in Quebec and incorporated in Nevada, will pay about $2.5 million for the assets of A.T. Reynolds & Sons Inc. The 125-year-old spring water company in Kiamesha Lake, which does business as Leisure Time, had been operating under Chapter 11 bankruptcy protection since December.
Most of the money will go to the company’s largest creditor, Wells Fargo Bank, which had liens against the plant and its equipment. Boreal will also pay $113,000 in back real estate taxes.
Boreal’s offer edged out another bidder who promised more money but couldn’t consummate a deal as quickly. Time, in this case, was of the essence.
New York State Electric & Gas Corp. threatened to cut off Leisure Time’s power on Monday if it didn’t pay overdue bills, and a plant shutdown might have killed the sale.
While under bankruptcy protection, Reynolds burned through its available cash more quickly than anyone expected, and it failed to pay a number of bills, including NYSEG’s.
After six hours of negotiation in and out of the courtroom Friday, all the necessary parties except the utility company had approved Boreal’s bid.
In the end, Wells Fargo agreed to pay NYSEG $35,256.23 to keep the lights on. The bank will recoup some of the expense through a higher interest rate on its loan to Boreal.
“We will encourage the purchaser to seek wind and solar going forward,” said Jeffrey Wurst, Wells Fargo’s lawyer.
NYSEG did better than most of the company’s creditors, who will receive nothing more than the chance to pick up a new client.
“In the current economic climate, that’s something that cannot be ignored,” said Ken Rosen, the lawyer for the committee of unsecured creditors.
Boreal expects to complete the purchase by the end of next week. It will sell off Leisure Time’s delivery business for $700,000, with Dowser, the Pepsi water brand, expected to pick up the New York operations, and Black Bear the New Jersey business.
Boreal plans to keep the 30 to 35 people who work inside the Kiamesha Lake water plant, said CEO Francine Lavoie. The fate of the drivers will depend on the companies buying the delivery businesses.
“The companies told me they intend to hire them,” Lavoie said.
Two Reynolds executives will be required to sign noncompete agreements. Harold Bruce Reynolds, the company’s president, filed for personal bankruptcy March 11 to avoid being held liable for company debts he had personally guaranteed.
(Source: Times Herald Record)
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3 Responses
B”H my summer water cooler will once again be providing refreshing leisure time water to my family as in the past. I was nervous the whole winter since I heard LT filed for Ch 11 about what my kinderlach would be drinking this summer.
DUH,how about sink water with a Brita filter,or in worst case another brand of water? The world will not end,and people will not die of thirst if Leisure Time closes up. Did you know there are other companieswho bottle water,besides LT? Yes, there are. Really.
ani oymer- There are water purifiers (I do not know any names in particular) that attach under the kitchen sink, that are a safer and cleaner alternative to Bottle Drinking Water. If you Google Water Purifier and write where you live, then you can get names of Companies and the Distributor representing the Company in your area. After buying so many bottles of Bottled Water for x amount, by buying a Water Purifier you can own and start reaping the benefit of drinking Purified Water at a fraction of the cost.