Joel R. Glucksman
Partner
201-896-7095 jglucksman@sh-law.comFirm Insights
Electric Car Maker Seeks Bankruptcy Protection
Author: Joel R. Glucksman
Date: May 14, 2013
Key Contacts
Back
Coda Automotive, an electric car maker seeks bankruptcy protection in a U.S. Bankruptcy Court in Delaware.
The company plans to exit the automotive industry altogether to focus its resources on energy storage, as the technology it currently uses to manufacture green vehicles is the same as that used to store power, according to the New York Times. Coda said that it’s in “dire” financial trouble, and has sold fewer than 100 vehicles since March 2012. To add to matters, its first vehicle was delayed for a year as a result of regulatory issues, according to Detroit News.
In response to muted interest and sales, the company implemented a series of layoffs and was forced into several lawsuits for falling behind on bills to suppliers and lenders.
“After concluding a comprehensive review of our strategic options, the Board of Directors, management team and senior lending group have concluded that focusing on the Company’s energy storage business presents the best opportunity moving forward,” said Phil Murtaugh, CEO of CODA Holdings, Inc. “We believe the restructuring process that we have entered into today will enable the Company to complete a sale and confirm a Plan that maximizes the value of its assets, serving the best interests of our stakeholders.”
A group of lenders have already entered into agreement with Coda in which they will extend debtor-in-possession financing and purchase the company for $25 million through the bankruptcy process.
Coda’s bankruptcy filing is the latest in a string of green energy automotive companies that have run into financial issues and been forced to file for bankruptcy protection. A123, Bright Automotive, Think Global, Enerdel, Aptera Motors, Azure Dynamics and Next Autoworks are other electric car makers that have faced declining demand for their products, primarily due to high battery prices, Detroit News reports.
- Practices: Corporate Transactions & Business, Bankruptcy & Creditors' Rights
- Locations: Red Bank, NJ, New York City, Little Falls, NJ
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Related Posts
See all
You Just Received a Federal Grand Jury Subpoena in New Jersey: Now What?
Receiving a federal grand jury subpoena is not something most businesses or individuals anticipate. While it can be concerning, a federal grand jury subpoena does not necessarily mean that you are being accused of wrongdoing. It does, however, mean that a federal criminal investigation is underway and that federal prosecutors believe you may possess information […]
Author: George McGowan
Why Every Business Should Conduct an Annual Insurance Coverage Review
Most New Jersey business owners purchase insurance policies, file them away, and assume they are protected if a claim arises. Without a regular insurance coverage review, many companies discover gaps only after a lawsuit, cyberattack, property loss, or other significant event occurs. An annual insurance coverage review can help businesses identify potential risks, ensure their […]
Author: George McGowan
Demand Letters & Cease and Desist Letters: When to Send One (and When Not To)
Businesses and individuals often encounter situations where another party breaches a contract, fails to pay a debt, or continues harmful conduct. In many such disputes, a precisely drafted demand letter or cease-and-desist letter serves as a powerful legal tool. It can frequently resolve the dispute and avoid litigation. While demand or cease-and-desist letters can resolve […]
Author: George McGowan
How to Effectively Use Contracts to Manage Risk
Key provisions in your contracts, including those relating to indemnification, insurance, and defense, are essential to contract risk management. While sometimes considered “boilerplate,” these provisions play a pivotal role when determining which party is responsible for certain costs and liabilities. They must always be negotiated and drafted carefully. Indemnification Clauses Businesses should never overlook the […]
Author: George McGowan
Understanding Portability for Estate and Gift Tax
Portability of estate and gift tax enables a surviving spouse to inherit any unused portion of their deceased spouse’s federal estate and gift tax exemption. So, if one spouse doesn’t utilize their full exemption, the surviving spouse can effectively double their exemption amount with regard to estate tax liability. For married couples, portability offers a […]
Author: Marc J. Comer
Pet Trusts in New Jersey and New York: A Practical Estate Planning Tool
For many of us, pets are more than companions—they are members of the family. Yet they are often overlooked or inadequately provided for when it comes to estate planning. A pet trust offers a legally enforceable way to ensure that your animal continues to receive proper care if you become incapacitated or pass away. As […]
Author: Marc J. Comer
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.