AMERICAN TONERSERV TO FILE FOR BANKRUPTCY ?

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AMERICAN TONERSERV TO FILE FOR BANKRUPTCY ?

 user 2011-01-19 at 8:40:09 am Views: 74
  • #23941

    http://www.therecycler.com/news/15061/American-TonerServ-ceases-normal-business-operations.aspx

    AMERICAN TONERSERV TO FILE FOR BANKRUPTCY ?
    American
    TonerServ, an imaging company based in California, filed a form 8-K
    with the American Securities and Exchange Commission in Washington DC.
    The filing states that it has ceased normal business operations. The
    company has been issued with a notice of default and has $673,000 of
    principal and accrued interest outstanding.

    The filing states:
    “Due to the Notice of Default from MTS reported in the Company’s report
    on Form 8-K dated December 17, 2010 [...] the Company has now ceased
    normal business operations.  Management is now considering the future
    course of action, which may include requesting protection under the U.S.
    bankruptcy laws and/or a liquidation of the Company’s remaining assets.
    It adds: “In any event, the Company does not expect to be able to
    resume any normal business operations.  It is also unlikely that the
    Company’s shareholders would receive anything for their shares in a
    bankruptcy proceeding or liquidation.”

    David T. Shaver and Clyde
    C. Shaver, the former owners of Tonertype of Florida, have stated that
    they intend to establish a new business using the Tonertype name and
    serving the same customers as the Company’s subsidiary that has operated
    under the Tonertype name.

    The Company is currently negotiating
    with the Tonertype owners concerning inventory, collection of accounts
    receivable and other issues related to the business operated by the
    Company’s Tonertype subsidiary. However, the Company does not intend to
    attempt to continue business operations in that subsidiary.American
    TonerServ has been contacted for comment but has not responded at this
    time.

    http://www.therecycler.com/news/15061/American-TonerServ-ceases-normal-business-operations.aspx

    http://www.action-intell.com/2011/01/14/american-tonerserv-may-file-for-bankruptcy/

    American TonerServ (ATS) may be headed for bankruptcy.
    This
    marks a reversal for the Rohnert Park, CA-based toner cartridge
    remanufacturer, which was on an acquisition spree back in late 2007
    2008, scooping up iPrint Technologies, Image Technology Products,
    Mid-America Environmental, Pendl Companies, and Tonertype. In the first
    nine months of 2010, ATS had reported record revenue (see press
    release), and the firm announced in November that it was averaging 1,500
    toner cartridge sales per day, a 50 percent increase compared to
    approximately one year ago (see press release). Now, it appears that
    ATS’s appetite for acquisition may have been bigger than it could
    afford.

    On December 30, ATS filed a form 8-K with the Securities
    and Exchange Commission (SEC), in which the company said it has ceased
    normal business operations. The filing reads, “Management is now
    considering the future course of action, which may include requesting
    protection under the U.S. bankruptcy laws and/or a liquidation of the
    company’s remaining assets. In any event, the company does not expect to
    be able to resume any normal business operations. It is also unlikely
    that the company’s shareholders would receive anything for their shares
    in a bankruptcy proceeding or liquidation.”

    A number of events
    precipitated the business’s shutdown. According to a December 23 8-K
    filing with the SEC, on December 17, ATS received a notice of default
    and foreclosure notice from MTS Partners, Inc., formerly known as iPrint
    Technologies. It appears that ATS still owes the group $2.4 million in
    promissory notes and loans related to the acquisition. MTS was looking
    to take back assets such as equipment, customer lists and relationships,
    intellectual property, leasehold interests, and contracts and records.
    According to ATS’s December 30 8-K filing. “The company does not dispute
    the existence of the default or the right of MTS to take over the
    collateral securing the company’s obligations.” However, ATS warned,
    “The company may pursue other claims that it may have against MTS and
    related persons.”

    According to the December 30 8-K form, on
    December 23, BDS Transitions, LLC, and David T. Shaver and Clyde C.
    Shaver, the former owners of Tonertype of Florida, LLC sent ATS a notice
    of default for an installment promissory note related to the Tonertype
    acquisition. ATS still owed the Tonertype parties approximately $673,000
    related to the acquisition.

    Finally, on December 28, ATS
    received a notice of default and acceleration from Celtic Capital
    Corporation on a loan. Celtic Capital indicates the amount of principal
    remaining under the loan is $2.1 million, and the creditor is demanding
    immediate payment of the principal, accrued interest, fees, and other
    expenses.

    While MTS is looking to take back assets, the Tonertype
    parties are looking to do that and restart operations under their
    former name. The December 30 filing states that the notice of default
    sent by Tonertype “states that the Tonertype parties intend to take over
    a Tonertype website, telephone numbers, and other intellectual
    properties.The Tonertype parties also stated that they intend to
    establish a new business using the Tonertype name and serving the same
    customers as the company’s subsidiary that has operated under the
    Tonertype name.”

    All this drama goes to show that the merger
    mania that has swept through the non-OEM supplies industry can be
    dangerous to a company’s financial health. It appears that despite ATS’s
    “record revenues” of last year, it simply was not making enough to pay
    back what it owed.

    http://www.action-intell.com/2011/01/14/american-tonerserv-may-file-for-bankruptcy/