Short on cash and with debts mounting, an Eastern Henrico firm this week filed for Chapter 11 bankruptcy.
International Foam Packaging, headquartered near Richmond International Airport, sought bankruptcy protection as it works a reorganization plan to restructure its debt.
The 13-year-old company manufactures packaging for pharmaceutical products.
Attorney Ronald Page, who is handling the bankruptcy case and spoke on behalf of the company, said the firm specializes in packaging for drugs that have to be shipped and handled delicately, such as vials of insulin.
The company will remain in business while it works through the Chapter 11 process, Page said.
“The business is still up and running,” Page said. “They have a backlog of orders. It just got in a difficult cash position.”
The company’s initial bankruptcy filing lists between 50 and 99 creditors owed between $1 million and $10 million.
The only creditor listed in the initial filing is its landlord, Liberty Property Trust.
International Foam owes Liberty back rent on its 40,000-square-foot warehouse at 5639 Eastport Blvd. It also owes money to a number of trade creditors, Page said, and all of its debt is unsecured debt.
Page International Foam President Joseph Sullivan hires contract workers on an as-needed basis.
The company ran into trouble after some of its clients waited to pay for 60 and sometimes 90 days, leaving the small company in a cash pinch.
“They’ve seen their payments get pushed out by large national and multinational pharmaceutical companies,” Page said.
I wish this article talked about how the owner still has yet to pay his employees (including myself) for wages. Or how he continued to hire new employees with no intention of paying them. Or how he did not want to cooperate with the DOL to pay back the wages. So many families were affected.