New York City soup producer and marketer Soupman – home of Seinfeld’s “Soup Nazi” character – has filed for bankruptcy protection following charges against former CFO Robert Bertrand last month.
Bertrand was charged with 20 counts of failing to pay federal income taxes, Medicare and Social Security for the company’s employees between 2010 and 2014. Total alleged unreported cash and stock compensation was around $2.86 million, and total alleged tax loss to the U.S. was about $594,000.
Although the former CFO has pleaded not guilty, that doesn’t negate the legacy liabilities the company is facing, which fall somewhere between $10 million and $50 million. The company’s assets only total between $1 million and $10 million.
“The combination of legacy liabilities and recent company developments have made it necessary to seek bankruptcy protection,” CEO Jamie Karson said in a statement.
Karson said that Soupman’s goal is to keep the company’s soups on grocery shelves across the country and to continue business operations as usual. This will be possible through a new $2-million bankruptcy loan, which will facilitate continuing operations despite Soupman’s financial distresses.
The company’s lender has provided ongoing support through a new DIP facility so that service and product quality will not be disrupted while Soupman restructures its business, Karson said.