PNC Bank Files Suit Against Faltering Carriage
PNC Bank has filed a lawsuit to take possession of Millersburg, Ind.-based Carriage Inc., a legendary, 45-year-old, towable RV manufacturer that the bank says owes it more than $5 million, The Goshen News is reporting this morning (Oct. 20).
The news didn’t come as a complete surprise around the northern Indiana community of Millersburg, where the company’s 180 employees were furloughed Monday because Carriage’s management reportedly was concerned that the workers would not be paid.
While Carriage spokesmen were unavailable for comment, the parking lots and factory buildings at the small-town complex were silent Wednesday, a day after a lawsuit was filed against the company by its primary creditor, PNC Bank of Indianapolis. The bank is demanding immediate payment of more than $5 million in overdue loans.
Rumors of Carriage’s financial woes had been circulating throughout the area for the past two weeks, when company officials first made the call to start closing down its buildings and sending home workers, The Goshen News reports.
According to the lawsuit filed Tuesday in Elkhart County Superior Court I, Carriage owner Glenn Cushman has been in default of his financial obligations to PNC Bank from as far back as September of 2009, requiring the issuance of several loan extensions.
The most recent extension delayed Cushman’s payment date for all obligations and indebtedness to this past Monday, Oct. 17. When PNC officials didn’t receive payment of the loans on Monday, the lawsuit against Cushman and his company was filed the following day on the premise that the company was “insolvent or in immediate danger of insolvency.”
“The most recent financial statements provided by Carriage to PNC, those dated as of the end of August, 2011, indicate that Carriage has a significant negative net worth,” the lawsuit states. “Carriage has lost in excess of $1 million during calendar year 2011 to date. The financial statements provided to PNC by Carriage indicate that Carriage is losing substantial amounts of money, and continued operations by Carriage without a receiver will only result in further financial deterioration to the detriment of PNC and the other creditors of Carriage.”
Consequently, PNC is requesting that a receiver be appointed on their behalf to essentially take control of the company from Cushman, says The Goshen News. Once that transfer has occurred, the appointed receiver would then have the option to continue to operate the Carriage facility under PNC’s name or simply sell off or lease the property in order to settle Cushman’s debts.