Overland Park, KS - July 3, 2015 - (Newswire.com)
GasMart USA, Inc. (“GasMart”) and its related entities, Aving Rice, LLC, G&G Enterprises, L.L.C., and Fran Transport & Oil Company (collectively, the “Debtors”) announced today that, effective July 2, 2015, they had filed Chapter 11 bankruptcy cases in the Bankruptcy Courts in the Western District of Missouri in Kansas City, Missouri. It is the intent of the Debtors to reorganize and emerge from bankruptcy as much stronger companies. While the Debtors have collectively reduced their debt level by some $34 million due to some recently announced sale of locations, including a transaction involving 19 stores with TravelCenters of America (NYSE: TA), the Debtors have determined that it is in the best interest of the Debtors and their creditors to file the Chapter 11 cases.
After the aforementioned debt reduction, the Debtors have continued to struggle from a cash flow perspective. The lack of trade credit with most of their vendors, including fuel and groceries, has forced the Debtors to file these cases. The good news is that in filing the cases, the Debtors have secured $1.5 million in Debtor-in-Possession financing (the “DIP Financing”) from two of the Debtors’ key lenders for use in restoring inventory levels and making many necessary operational improvements. This DIP Financing will allow the Debtors to negotiate and return to reasonable terms with a number of vendors including grocery vendors and CITGO Petroleum Corporation. Moreover, the Debtors anticipate that the filings and DIP Financing will pave the way for new fuel arrangements with Phillips66 (NYSE: PSX), the Debtors’ principal fuel supplier.
In speaking about the filings, David George, the President of the Debtors, indicated, “We are extremely pleased with the support of the two lenders that are providing the DIP Financing. This DIP Financing should send a strong signal to our vendor community that we are open for business and now have the cash necessary to complete our turnaround. We welcome the participation by our vendors in this process and look forward to renewed and continued mutually beneficial relationships with our suppliers.”
John Tittle, the Debtors’ CEO agrees in that, “We have been limited in our efforts to turnaround the chain due to continuing cash flow issues and inability to properly stock the stores. Now we can complete what we set out to do. With the tanks and shelves restocked and the stores continuing to be refreshed, we look to provide our customers a better experience each time they visit one of our locations. I regret the inconvenience and frustration that our recent cash flow problems have placed on our customers and our employees. We owe a tremendous debt of gratitude to our loyal customers and employees who have endured with us during this challenging period. For those customers whom we have lost in this process, we would ask that you give us another chance. Happy July 4th to everyone. God Bless America.”
About GasMart USA, Inc.
GasMart USA, Inc., and its affiliates, headquartered in Overland Park, Kansas, is a high-volume distributor of primarily branded motor fuel that operates 42 convenience store and gas station locations in Illinois, Wisconsin, Indiana, Iowa, and Nebraska. Its locations are generally branded Phillips66, Conoco, or CITGO. The trade names employed include Gasmart and Jumping’ Jimmy’s. In addition to retail gasoline convenience stores, GasMart and its affiliates operate a wholesale fuel business as well as a fuel transportation concern.
Contacts:
John Tittle, Jr., Chief Executive Officer
David George, President
(913) 599-5800
Contact Info:
Gas-Mart USA, INC.
Suite 100 10777 Barkley Street
Overland Park
KS 66211
United States
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Original Source: GasMart and Related Entities Filed Chapter 11 Bankruptcy Cases
