Information for Creditors of GPMI Co.
Case Number 22-00150 in the United States Bankruptcy Court for the District of Arizona
THE DEBTOR’S BUSINESS HISTORY
GPMI Co. was founded in 1989 by Yarron Bendor, who remains CEO of the company to this day. Debtor is a manufacturer and “supplier of consumer packaged goods with a focus on cleaning products, primarily two types of “wet wipes” delivery systems – those sold in “soft-packs” and those sold in “canisters,”” according to documents filed in the bankruptcy case.
The Debtor sells its manufactured goods to wholesalers and retailers, including Walmart stores. Over the years, the Debtor has contracted with several different private labels to manufacture their products. Some of the private labels that have contracted with the Debtor include Clorox, P&G, Dial, and Rain-X. Additionally, the Debtor produces its own products under its proprietary labels, GermaClean and Four Peaks Auto Care.
THE EVENTS THAT LED DEBTOR TO BANKRUPTCY
According to the Debtor’s CEO in bankruptcy filings, in the fall of 2019, the Debtor was approached by a company named Albaad, Inc., which is a company headquartered in Israel with an American subsidiary. Albaad asked the Debtor to handle manufacturing for a large client of Albaad’s in the United States. Through this contract, the Debtor was required to substantially expand its manufacturing and production capabilities. However, the expansion would have been more than paid for through the contract. Albaad advanced the Debtor some money for its expansion costs but the Debtor also incurred a large amount of debt to expand its capabilities in order to fulfill the contract.
Ultimately, the Debtor took on several million dollars in additional debt. Yet, Albaad never fulfilled any of its obligations under the contract. So, the Debtor incurred a lot of debt but did not realize the benefits that would have allowed it to pay off the debt.
WHAT THIS MEANS FOR CREDITORS
While it is now in bankruptcy, the Debtor does intend to reorganize and emerge from bankruptcy as an operational entity. Basically, GPMI Co. will continue to exist through and after the bankruptcy case. This is good news for the creditors because it means that GPMI will have to provide a plan for repayment of its creditors, in whole or in part, that creditors will be able to review and object to.
Despite what many people think, creditors do have a say in bankruptcy cases. In fact, judges are often looking to hear from creditors. So many fail to speak up because they think it is a waste of time. However, in a case like this, it can be very beneficial for creditors to work together and push for full repayment. Unsecured creditors have an opportunity to serve on an official committee of unsecured creditors, which can advocate for the rights of trade vendors and have its legal bills paid for by the debtor – not by the creditors. This procedure is likely a good choice for creditors of GPMI Co. If you have questions about this case or information provided on this page, please feel free to reach out to PRLT attorneys.
PRLT does not represent GPMI Co. or any of its affiliates. The content on this page is provided for informational purposes only. Nothing on this page or this website creates an attorney/client relationship between you and PRLT. Nothing on this page is legal advice. If you have any questions about the GPMI Company bankruptcy case or anything discussed on this page, please contact us.