|Updated: 8/29/2011 3:44 pm
||Published: 8/29/2011 10:07 am
SEARCY, Ark. (AP) - Yarnell's Ice Cream Co. filed for Chapter 7 bankruptcy on Friday, but the development doesn't necessarily signal the end of the last locally-owned ice cream producer in Arkansas.
The Searcy-based company could be revived if an investor can propose a deal to bring the operation back to life, though that would need the approval of a bankruptcy judge.
The 178-page filing in U.S. Bankruptcy Court for the Eastern District of Arkansas shows Yarnell's has assets of $8 million and liabilities of $15.7 million.
Among Yarnell's debts is about $4 million owed to the state - $2.1 million to the Arkansas Development Finance Authority and $1.9 million to the Arkansas Economic Development Commission.
Commission spokesman Joe Holmes said a variety of deals have been proposed and that the state is working with the bankruptcy trustee to try to reach a quick resolution. Holmes did not go into specifics about the proposals.
"There has been a lot of activity the past several weeks working with various offers to buy the company," Holmes said.
One portion of Yarnell's debt - $225,000 - is owed to employees who were left unpaid when the company abruptly shut down on June 30. A former worker has sued the company for its failure to give employees 60 days of notice that the plant would close, as required by the Adjustment and Retraining Notification Act.
That law requires companies with more than 100 workers to give two months' written notice of a pending closure or to at least give workers pay and benefits for that time period. The suit, by Shane Habisreitinger, seeks class status.
Yarnell's denied the allegations in the suit.
When the company shut down, it said it couldn't secure financing to keep its doors open. It had faced a decline in sales and increases in materials costs.
About 200 workers lost their jobs, 150 at the main Searcy plant.
The family-owned company had been in business for 80 years.
(Copyright 2011 by The Associated Press. All Rights Reserved.)