Eminent Cycles has filed for Chapter 11 bankruptcy protection so it can restructure its existing shareholder debts.
Eminent Cycles was founded in 2014 by Jeff Soncrant after he found himself unable to find his perfect bike on the market. The Eminent range began with the Haste in 2017
but this was replaced by the Onset
frame that is available with three different travels - ST, MT and LT. The Southern California company mainly ran a direct-to-consumer model but also has a dealer network stocking its bikes too.
A Chapter 11 bankruptcy does not mean that a company will stop trading, instead, it involves a reorganization plan to keep a business alive and pay creditors over time. According to a Bicycle Retailer and Industry News
report, Eminent currently has debts of $1.4 million and assets of $139,000. Those debts include $320,000 to founder Soncrant, $640,000 to Soncrant's father-in-law Humberto Zavaleta and $448,000 owed to Stella Mondo, a company formed by Eminent co-founder Kevin Sigismondo, that is suing Eminent in a collections case.
Eminent has confirmed to Pinkbike that it will continue trading and that the existing ownership will fund the future of the brand. The brand is not expecting any supply interruptions due to the reorganization and it even has a new model coming later this year. The full release from the brand is below.
Statement: Eminent Cycles
Eminent Cycles announces it has voluntarily filed for Chapter 11 restructuring. The restructuring submission allows Eminent Cycles to seek a debt restructuring of its shareholder liabilities to improve its overall financial position.
Eminent Cycles will continue to operate and move forward without any interruption. The company has secured financial funding from existing ownership. Said funding will provide the company with the money it needs to complete reorganization process. The restructuring is solely focused on the existing shareholder debts.
No supply partners will be impacted. Eminent Cycles does not anticipate any supply interruptions during or after the reorganization process. Eminent Cycles remains committed to its dealers, its suppliers and customer satisfaction. This can be seen through the ongoing:
- Supply of bikes and bike components to all dealers and customers
- Investment in the future through new model introductions slated for later this year
- Continued support of all product owners and dealers