FarmTrac Troubles

[California]

... from what I have read so far, there will be lawsuits coming out of this by someone, be it a dealer, consumer, creditor group or state attorney general.

Before the posse mounts up and charges off in all directions ...

Looking at this from the outside, I don't see anything to recover. I think the starting point in analyzing this is to rank the creditors in the order they will get paid, by state law or specific contracts. Just my rough guess:
Property tax
wage withholdings not yet sent to feds, state, etc.
wages
corporate income tax
local utilities
big lenders
materials and parts suppliers, overseas tractor manufacturers
owed to dealers and customers, warranty claims, finance rebates, etc
stockholders equity.

(what did I miss?)

An early post in this thread said lenders had claims near $15 million and Farmtrac's present assets are $12 million. Rough numbers, but it gives us something to talk about.

Now, looking at those auction photos I wonder if there really can be $12 million in auction proceeds.

So after the auction, if the proceeds are applied to debts in the same order as I listed above, who gets paid?

Also - the claimants below the cutoff line amount to a negative equity that any successor company will have to settle with, before they could restart the company.

It looks to me there is little to be gained by lawsuits or talk of getting the company going again.

Now - can somebody that knows something, connect the dots and give us a clearer presentation of where things stand?

 

[rascoil]

It is very Enron-esque. I would refine your point of this being "all because of lies" statement. I see it as being all because of greed. This in turn fostered the lies.

Wonder why the CEO/CFO went to India when all this started going south? My speculation is because it puts them outside the jurisdiction of the North Carolina Attorney General and the United States Justice Department. Yes, I'm cynical. But only because I've seen this before.

This is a good thought, I have sorta found out that one of the so called Indians owns the local Comfort Inn Hotel in this town. From the way Sushil talked. Just a hunch, so I guess they will be building a new one with the loot they got before they run to India.

 

[sseelhoff]

Before the posse mounts up and charges off in all directions ...

Looking at this from the outside, I don't see anything to recover. I think the starting point in analyzing this is to rank the creditors in the order they will get paid, by state law or specific contracts. Just my rough guess:
Property tax
wage withholdings not yet sent to feds, state, etc.
wages
corporate income tax
local utilities
big lenders
materials and parts suppliers, overseas tractor manufacturers
owed to dealers and customers, warranty claims, finance rebates, etc
stockholders equity.

(what did I miss?)

An early post in this thread said lenders had claims near $15 million and Farmtrac's present assets are $12 million. Rough numbers, but it gives us something to talk about.

Now, looking at those auction photos I wonder if there really can be $12 million in auction proceeds.

So after the auction, if the proceeds are applied to debts in the same order as I listed above, who gets paid?

Also - the claimants below the cutoff line amount to a negative equity that any successor company will have to settle with, before they could restart the company.

It looks to me there is little to be gained by lawsuits or talk of getting the company going again.

Now - can somebody that knows something, connect the dots and give us a clearer presentation of where things stand?

I understand your point, and I'm not advocating this action, but prognosticating what will likely occur. And in that regard, I'm not talking about corporate liablity, but personal liability for the managment group and individuals involved post receivership.

Enron is a classic example. The company itself was in the same situation, but the creditors were able to recover substantial judgments against Ken Lay and other members of the Board of Directors and Corporate Officers. (And then there was the criminal prosecutions as well, but that is less likely here since it was not a publicly traded company).

 

[rascoil]

Before the posse mounts up and charges off in all directions ...

Looking at this from the outside, I don't see anything to recover. I think the starting point in analyzing this is to rank the creditors in the order they will get paid, by state law or specific contracts. Just my rough guess:
Property tax
wage withholdings not yet sent to feds, state, etc.
wages
corporate income tax
local utilities
big lenders
materials and parts suppliers, overseas tractor manufacturers
owed to dealers and customers, warranty claims, finance rebates, etc
stockholders equity.

(what did I miss?)

An early post in this thread said lenders had claims near $15 million and Farmtrac's present assets are $12 million. Rough numbers, but it gives us something to talk about.

Now, looking at those auction photos I wonder if there really can be $12 million in auction proceeds.

So after the auction, if the proceeds are applied to debts in the same order as I listed above, who gets paid?

Also - the claimants below the cutoff line amount to a negative equity that any successor company will have to settle with, before they could restart the company.

It looks to me there is little to be gained by lawsuits or talk of getting the company going again.

Now - can somebody that knows something, connect the dots and give us a clearer presentation of where things stand?

My wife is an attorney and from what she can see is, they will sell off what they can, pay what they can, and then file for bankruptcy. So what little assets are left will then be sold and you all will get about .05 to .11 cents for every dollar you are owed. To be honest there is nothing legally that can be done until they file for bankruptcy. So you will just be wasting you money if you even pay a lawyer for a sit down. There is nothing I have found you could do. If there was I would not be paying to have a motor installed my self. I am just lucky I got a motor. That pretty much sums it up.

 

[tommybr]

Ever notice how many big crooked companies end with "ron"....Enron, etc.

 

[SESS]

An early post in this thread said lenders had claims near $15 million and Farmtrac's present assets are $12 million. Rough numbers, but it gives us something to talk about.

Before Lewpack website took off the 900+ tractors they had listed for sale, it totaled little over $12 million. As we all know about equipment auctions, there is no telling what the price will bring for the stuff. BUT look at the economy right now, I don't think things will go high. I certainly don't see the people who live in Tarboro to run out and spend, spend, spend. That town is small and probably 3/4 of them know people that work at Farmtrac or dealers who have been effected by all this. It will be an interesting couple weeks leading up the auction.

 

[rascoil]

I understand your point, and I'm not advocating this action, but prognosticating what will likely occur. And in that regard, I'm not talking about corporate liablity, but personal liability for the managment group and individuals involved post receivership.

Enron is a classic example. The company itself was in the same situation, but the creditors were able to recover substantial judgments against Ken Lay and other members of the Board of Directors and Corporate Officers. (And then there was the criminal prosecutions as well, but that is less likely here since it was not a publicly traded company).

That is very true seeing they are a privately held company. The laws affect them in a hole new way. They can almost take the money and run and they know it. Textron is safe because they are just trying to recoup there losses. But the two Fellows that run out of the country are the real criminals. They could get no more then a slap on the wrist. Just look at the guy that took down the UK bank. For Billions he is looking at what 5 years and a fine, please. These kind of clowns need to get a life sentence for there actions. Some one some where got paid. Paid well. Follow the money. That is all some one has to do.

 

[sseelhoff]

Ever notice how many big crooked companies end with "ron"....Enron, etc.

Like the song says

"Go on, take the money and ron."


Ok, bad joke, but I couldn't resist the hanging curveball.

 

[taxpayer]

Just to make this clear-Court appoints Morrow as the receiver. Morrow(?) brings in Doug Gurkins to serve as CEO/Assistant Receiver. Gurkins then signs deal with Countryboy Auctions & Realty, a company in which he has an ownership interest, to handle the disposition of the assets, for which he (or his company) will no doubt receive a fee.

This is clearly a conflict of interest. If Gurkins was behind the Lewpack debacle as well, he may really have a problem. I hope whatever money he makes is enough to compensate him for the headache he is going to have once the lawsuits start flying. And from what I have read so far, there will be lawsuits coming out of this by someone, be it a dealer, consumer, creditor group or state attorney general.

You are absolutly right about the lawsuits.but we need to stay focused on gathering info and exploring every angle,Don't get tunnelvision because we are angry,and it,s hard not to be.I know I would like to see these characters talked to by hand until we come to agreement. I said this to someone recently,"before we can win this battle in a court of law,we need to win the battle of public opinion", and I believe we are winning that battle.----Taxpayer

 

[country69]

i dont think nobody local will be buying alot of these tractor cause its deere country around the tarboro area ..and the town probally has a population of 11-12 thousand and its mostly the big famers left around here and they dont have no use got these little tractors much