Maines Paper & Food Service files bankruptcy following foreclosure

By Caroline Salls

Pittsburgh, June 10 – Maines Paper & Food Service, Inc. filed Chapter 11 bankruptcy Wednesday in the U.S. Bankruptcy Court for the District of Delaware.

Maines said its largest secured creditor, Lineage Bluebird Debtco, LLC, foreclosed upon the company’s assets on May 17 and acquired substantially all of Maines’ assets, including its inventory and receivables.

Lineage also provided a contribution of $5.2 million in cash to fund the company’s wind down through these Chapter 11 cases, and agreed to fund payment of outstanding sale and use tax obligations as of the foreclosure date, as well as some outstanding obligations to suppliers of perishable agricultural commodities and other similar products.

In connection with the foreclosure agreement, Maines said it entered into a termination services agreement with Lineage. During the transition period, the Maines debtors will pay both the Lineage funded expenses and ordinary course post-bankruptcy expenses through its normal cash management system.

According to court documents, Maines has $1 million to $10 million in assets and $100 million to $500 million in debt.

The company’s largest unsecured creditors are Restaurant Services, Inc. of Miami, with an $11.83 million trade claim; Coca-Cola North America, based in Atlanta, with an $11.44 million trade claim; Tim Hortons USA Inc. of Miami, with a $6.88 million trade claim; Ernst & Young Capital Advisors, LLC of New York, with a $2.5 million professional services claim; Birchwood Foods of Columbus, Ohio, with a $2.49 million trade claim; Impossible Foods Inc. of Redwood City, Calif., with a $2.45 million trade claim; Sentry Insurance of Stevens Point, Wis., with a $1.87 million trade claim; M&T Bank of Buffalo, N.Y., with a $1.68 million deficiency claim; Darden Direct Distribution, Inc. of Orlando, Fla., with a $1.69 million customer prepayment claim; and Associated Milk Producers Inc. of Chicago, with a $1.64 million trade claim.

Maines is represented in its Chapter 11 proceedings by Pachulski Stang Ziehl & Jones LLP.

Conklin, N.Y.-based Maines operates as an independent foodservice distributor in the United States. The Chapter 11 case number is 20-11502.

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