Nevada Bob’s Canada reorganizes to avoid bankruptcy

Canadian golf retailer Nevada Bob’s Canada Inc. said on Tuesday its financial situation is in peril and it will file for bankruptcy unless it can secure financing and sell about 80 of its retail stores as franchises.

The Globe and Mail
October 10, 2000

Nevada Bob’s Canada reorganizes to avoid bankruptcy

TORONTO – Canadian golf retailer Nevada Bob’s (Toronto:NBC.TO - news) Canada Inc. said on Tuesday its financial situation is in peril and it will file for bankruptcy unless it can secure financing and sell about 80 of its retail stores as franchises.

Calgary-based Nevada Bob’s also said its chief financial officer Allen Smith has stepped down, and the company’s chief executive and president Tony Loth will assume his role.

Nevada Bob’s said that in its second-quarter it has incurred charges against its earnings and has written down assets to their estimated realisable value.

The company said it will look to sell 80 company owned stores as franchises as well as its Alien Golf manufacturing division, with proceeds used to pay down debt and provide working capital.

Nevada Bob’s total liabilities exceed its total assets by C$30-million (US$20-million), and it is in continuing default of “certain loan covenants with its senior secured lender,” said the company.

If the company is not able to alleviate its funding crunch, or find buyers for its retail stores, it may “be forced to seek protection under the Companies’ Creditors Arrangement Act in Canada and under Chapter 11 or Chapter 7 of the United States bankruptcy code,” said Nevada Bob’s in a statement.


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