A bankruptcy court this week approved Genmar Holdings' request to allow it to continue its existing promotional programs for Ranger Boats, the company's Flippin, Ark.-based subsidiary.
This includes payment of certain prepetition promotional claims, such as $500,000 in prize boat certificates for the FLW series of fishing tournaments; $140,000 in sportswear certificates; $95,000 in cash prizes and $150,000 in certificates issued as part of the Ranger Cup program; $26,185 in obligations owed to professional anglers; and $30,000 in advertising for fishing tournaments.
In the request filed last week, Genmar said it has "sufficient amounts available in their budget with Wells Fargo Bank, National Association, Fifth Third Bank and GE Commercial Distribution Finance to pay the prepetition promotional costs."
Both the Committee of Unsecured Creditors and Textron Financial Corp. had filed objections to Genmar's request to allow the promotions to be paid, noting that the promotions totaled nearly $1 million.
"The committee also objects to the necessity of spending the debtor's limited financial resources on preserving only Ranger Boats," the Committee of Unsecured Creditors said in its court filings. "The debtor's cases have not been substantively consolidated, and, therefore, the creditors of Ranger Boats are being disproportionably affected because of the debtor's concentrated attention to it."
Textron said in its filings that any prepetition promotional claims should be delayed until Genmar can demonstrate the likelihood of a successful reorganization, "including the payment of a meaningful dividend to unsecured creditors."