Scarinci Hollenbeck, LLC, LLCScarinci Hollenbeck, LLC, LLC

Firm Insights

Alabama Grocery Chain Files For Bankruptcy under Chapter 11

Author: Joel R. Glucksman

Date: July 18, 2013

Key Contacts

Back

Alabama grocery conglomerate – Belle Foods – filed for bankruptcy law protection under Chapter 11 of the Bankruptcy Code, citing excessive debt and insufficient cash flow as the cause of its financial strain.

The company, which once operated the former Bruno’s and Food World stores, said it was finding it difficult to meet its creditor obligations with revenue from its 57 stores in Alabama, Georgia, Florida, and Mississippi. Belle Foods acquired the stores from Southern Family Markets, the company that took control of a number of Bruno’s and Food World chains, according to AL.com.

What if you could catch all the sports you desired with a treasure trove of free food in tow? What if you could do this while making money? Setting up as a food vendor in a sports venue might sound great, but there is plenty of work to be done before you start selling hot dogs to fans.

As a result of the purchase, Belle Foods still owes Southern Family Markets $4 million for a loan and $24 million in a revolving line of credit. Belle Foods also owes C&S Wholesale Grocers $5.1 million in accounts payable and $900,000 on a pension withdrawal liability note,  the news source reports. The company listed $8 million in other accounts payable due.

In its bankruptcy filing with the U.S. Bankruptcy Court for the Northern District of Alabama, the company cited technical difficulties with its accounting system and poor structuring of lending and creditor relationships as contributing factors to its bankruptcy.

“Additionally, higher payroll taxes in 2013 have led to a decline in purchases by the (Belle’s) customer base,” the filing said. “Furthermore, (Belle) has also seen an increased amount of competition in several of its markets from other grocers. With older locations, Debtor has had difficulty competing with the newer grocery stores that have moved into its markets.”

The Associated Press reports that the company attempted to shave costs in April by hiring 300 part-time workers to replace full-time staff. However, 34 percent of the company’s workforce is full-time, and a large percentage are union workers, who have collective bargaining agreements with United Food and Commercial Workers 1996 and 1529 and the Retail, Wholesale and Department Store Union.

No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.

Scarinci Hollenbeck, LLC, LLC

Related Posts

See all
Crypto Enforcement: A Former Prosecutor’s Warning to Criminals and the Public post image

Crypto Enforcement: A Former Prosecutor’s Warning to Criminals and the Public

Cryptocurrency intimidates most people. The reason is straightforward. People fear what they do not understand. When confusion sets in, the common reaction is either to ignore the subject entirely or to mistrust it. For years, that is exactly how most of the public and even many in law enforcement treated cryptocurrency. However, such apprehension changed […]

Author: Bryce S. Robins

Link to post with title - "Crypto Enforcement: A Former Prosecutor’s Warning to Criminals and the Public"
Understanding Chattel Paper: A Key Component in Secured Transactions post image

Understanding Chattel Paper: A Key Component in Secured Transactions

Using chattel paper to obtain a security interest in personal property is a powerful tool. It can ensure lenders have a legal claim on collateral ranging from inventory to intellectual property. To reduce risk and protect your legal rights, businesses and lenders should understand the legal framework. This framework governs the creation, sale, and enforcement […]

Author: Dan Brecher

Link to post with title - "Understanding Chattel Paper: A Key Component in Secured Transactions"
Crypto Compliance: A Comprehensive Guide post image

Crypto Compliance: A Comprehensive Guide

For years, digital assets operated in a legal gray area, a frontier where innovation outpaced the reach of regulators and law enforcement. In this early “Wild West” phase of finance, crypto startups thrived under minimal oversight. That era, however, is coming to an end. The importance of crypto compliance has become paramount as cryptocurrency has […]

Author: Bryce S. Robins

Link to post with title - "Crypto Compliance: A Comprehensive Guide"
Supreme Court and Title VII: Implications for Reverse Discrimination post image

Supreme Court and Title VII: Implications for Reverse Discrimination

Earlier this month, the U.S. Supreme Court issued a decision in Ames v. Ohio Department of Youth Services vitiating the so-called “background circumstances” test required by half of federal circuit courts.1 The background circumstances test required majority group plaintiffs pleading discrimination under Title VII of the Civil Rights Act to meet a heightened pleading standard […]

Author: Matthew F. Mimnaugh

Link to post with title - "Supreme Court and Title VII: Implications for Reverse Discrimination"
SPACs Are Back, What You Need to Know post image

SPACs Are Back, What You Need to Know

Special purpose acquisition companies (better known as SPACs) appear to be making a comeback. SPAC offerings for 2025 have already nearly surpassed last year’s totals, with additional transactions in the pipeline. SPACs last experienced a boom between 2020–2021, with approximately 600 U.S. companies raising a record $163 billion in 2021. Notable companies that went public […]

Author: Dan Brecher

Link to post with title - "SPACs Are Back, What You Need to Know"
Short Form Merger: Streamlining the Process for Businesses post image

Short Form Merger: Streamlining the Process for Businesses

Merging two companies is a complex legal and business transaction. A short form merger, in which an acquiring company merges with a subsidiary corporation, offers a more streamlined process that involves important corporate governance considerations. A short form merger, in which an acquiring company merges with a subsidiary corporation, offers a more streamlined process. However, […]

Author: Dan Brecher

Link to post with title - "Short Form Merger: Streamlining the Process for Businesses"

No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.

Sign up to get the latest from our attorneys!

Explore What Matters Most to You.

Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.

Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.

Let`s get in touch!

* The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!