Fountain Powerboats and its affiliates filed for Chapter 11 bankruptcy protection last week for the second time in less than three years.
The filing was recorded Jan. 18 with the bankruptcy court in the Southern District of Florida, West Palm Beach. The company listed more than $53 million in liabilities and less than $50,000 in assets, according to court documents.
A total of $53,605,987.16 is owed to First Capital, according to the filing. No additional creditors are listed in the initial bankruptcy filing. A creditors meeting is set for Feb. 13.
“Debtor estimated that, after any exempt property is excluded and administrative expenses paid, there will be no funds available for distribution to unsecured creditors,” the filing states.
Parties included in the case are: American Marine Holdings, Donzi Marine, AMH Government Services, Baja Marine, Fountain Dealers’ Factory Super Store, Fountain Powerboats Industries Inc., Fountain Powerboats Inc., Fountain Powerboats LLC, Palmetto Park Financial and Pro-Line Boats.
The Washington, N.C., boatbuilder previously filed for Chapter 11 on Aug. 24, 2009, in the Eastern District of North Carolina. Since coming out of that Chapter 11 filing in 2010, the company has struggled financially, been engaged in a lawsuit with former owner and company namesake Reggie Fountain and seen many officers and employees come and go through its doors.
In December, Craig Barrie, a 30-year veteran of the marine industry, was named general manager of the four American Marine Holdings Inc. boat companies — Baja Marine, Donzi Marine, Fountain Powerboats and Pro-Line Boats — in an announcement by Ronald Glass, the court-appointed receiver and a principal in GlassRatner Advisory & Capital Group.
Glass was not immediately available for comment this morning, telling Soundings Trade Only via e-mail that he had a hearing in bankruptcy court today.
Speaking with Soundings Trade Only in November, Glass said the company was building boats and finishing work in progress. “We are slowly but surely calling people back to work and are in business and had reasonable traffic at the [Fort Lauderdale International Boat Show],” he said at the time.
First Capital filed suit against Fountain last fall, seeking $61.04 million in damages for an alleged breach of loan agreements, according to documents filed in October in North Carolina. First Capital also alleged misappropriation of funds.
Also last October, Liberty Associates announced that it had ceased providing management services to American Marine Holdings, and Liberty’s affiliate transferred its nominee ownership interest in American Marine to First Capital, a portfolio company of HIG Capital.
After Fountain Powerboats filed for bankruptcy in 2009, Liberty Associates and Fountain filed a joint reorganization plan and Liberty acquired the company. Former owner and founder Reggie Fountain was initially retained as CEO, but the two parted ways at the end of 2010.
Earlier this year, Reggie Fountain sued his former company for money he says is due him, as well as trophies and pictures from his racing days. Court documents Fountain filed also contain numerous allegations of past improper business dealings by Liberty CEO Bill Gates.
Fountain Powerboats filed counterclaims against Reggie Fountain, saying Fountain took company property, as well as trade secrets, when he left the company. Fountain has repeatedly denied those allegations and says there are no trade secrets at Fountain.
That case remains open, according to the court’s website.