Fountain files Chapter 11

[db71]

Why do you feel there are zeros left off of assets. My assumtion means something that is not secured by a loan and would actually be of value I'm sure every boat, motor, building, mold, etc is secured in fact he probably has a blanket loan that says all assets used to build a boat are pledged to a bank. So it is probably just ofice equipment or a tow vehicle or something.

[smokin' joe]

So will Baja go back to Bucyrus and start building entry level boats again?

There probably is or will be a deal made to manufacture performance boats in the Bucyrus plant again. This could help that cause...

[Chris]

There probably is or will be a deal made to manufacture performance boats in the Bucyrus plant again. This could help that cause...

Who's going to make those millions in investment in the boat business?

If the master marketer couldn't make it fly with his resources and those of Brunswick Corp behind him, combined with some of the best economy-of-scale out there, who's going to do a better job?

If dollars were going to be invested anywhere, what better place than Reggie's boatbuilding facility in NC?


Aside from all of that, Fountain is in Chapter 11. That's reorganization, not liquidation. That allows him to shed his debt, along with all that pesky stockholder equity, and start fresh.

[Matt Trulio]

Chris, though I am sorry for those in Bucyrus who lost their jobs when Baja went south (so to speak) I think your take is on the money.

The notion that Baja struggled because Reggie tried to "Fountainize" the line is rubbish. It cannot be backed by fact. Here's what can:

Baja dealers had huge new-boat inventory, moments before a huge recession. And the pre-owned stuff? Off the hook.

I am not pointing fingers in any way at anyone at Baja. But even in a robust economy, it would have been tough for Baja dealers to clear all their inventory in 2007 and 2008.

Because Reggie Fountain is something of a public figure, it's good sport to make fun of his personal style and all that. Fair enough ... you court the public, you take what you get from it. But regardless of what you think of Reggie or his product (Was it innovative or just good marketing?) the man has done as much, no, screw it, much more, than anyone, even Don Aronow to promote the high-performance boat industry.

Only an idiot, and I don't find many on this forum, would count him out.

[Ratickle]

The stockholder equity cannot be shed. By law, they are secured. I know, because of the stunt Obama's Socialists pulled with GM and Chrysler, some believe that is the way things work, it is not. That was an illegal nationalization of a company which, when challenged, was strong armed by the executive branch.

There has to be some zeros missing on assets. Just a simple typo error. Probably left off the M. Net value is different than assets and liabilities.

Hopefully they come back. From what I hear though, there are a couple of years worth of new Fountains out there unsold. If the market does not come back in a reasonable time frame, those assets continue to depreciate at an alarming rate. It will also probably drag the rest of the market down further if there is no bounce by next spring/summer.

All opinions of course.

[T2x]

This has been a foregone conclusion for a number of years....IMHO.

As far as the next chapter is concerned......... I think its time for Reggie to hang it up. Its not like there's a fortune to be made in the foreseeable future in sport...or "fish" boats, as he likes to call them. He has as many fans as he will ever have....... and as many who feel the emperor had no clothes in the first place. Neither of these groups will probably ever change their respective and collective minds....

I hope he kept that pile of North Carolina "old money" that he started with and can enjoy his retirement far away from boat shows, poker runs and races and limit his PR tour to a few appearances where he can be rewarded for the effort and commitment he expended.....regardless of the final results.

I, for one, feel for his employees .....and more so for his vendors...... because his employees will most likely be paid up until their final day and be eligible for unemployment benefits....but the vendors won't see a nickle.....to cover their own payrolls and expenses. Having been on the short side of many Chapter 11's by customers who ran up a their biggest bills just prior to filing....I feel their pain.

In the end, Reggie did not create the performance boat industry, nor did he particularly advance it. He was a good to great race driver who did market well and self promote using limited company income, a large infusion of shareholder investment, bank loans, vendor credit, and media advertizing leverage. Like Aronow this made him larger than life in some people's eyes and a Carolina P.T. Barnum in others. I always maintained that the real giant in the marine performance industry was Carl Kiekhaefer who created the market and the products to support much of the high performance marine industry. Reggie is a sort of step child to "Uncle Carl" as are many of us who have worked in the industry and created products that were simply matched to the state of the art of the products Mr. Kiekhaefer and his wonderful team of magicians pioneered.

The King is dead.......Long live the King.


T2x

[clayinaustin]

In 1957 Kiekhaefer introduced the Mark 75 motor, the industry's first 6-cylinder 60 hp (horsepower) outboard motor. Two Mark 75 motors set an endurance record by running for 68.75 days nonstop and over 50,000 miles. The motors were refueled on the run, and averaged 30.3 mph (miles per hour).

In 1961 Kiekhaefer Marine merged with the Brunswick Corporation.

Later that year Kiekhaefer would use his NASCAR and boat engineering skills to develop the 100 hp stern drive engine now known as MerCruiser. And as any offshore racing fan knows, the MerCruiser engine is the most successful stern drive ever developed. The engine once held over 80 percent of the worldwide market share.

Kiekhaefer resigned as president of the company in 1969, and the company name changed to Mercury Marine.

[Wahoo 214]

I would think that the Fountain name and brand is worth more than $50k.

[PatriYacht]

Perhaps they meant liquid assets. Like cash and receivables.

[DaveP]

Fountain Powerboats files for Chapter 11 bankruptcy protection

By IBI Magazine

Fountain Powerboats yesterday filed for Chapter 11 bankruptcy protection in the US Bankruptcy Court in the Eastern District of North Carolina. According to court documents, Fountain will attempt to sell its assets, including the facilities and tooling in North Carolina, as well as brand names and unsold inventory for the Fountain and Baja brands. It expects the assets to sell for between US$6m and US$8m.

Fountain said it owes its largest creditor, Regions Bank, US$19.6m. About US$4.3m of the total is for floor-plan loans, while the other US$15.3m was for term loans and a revolver loan. The company reported a loss of US$2.2m in fiscal 2008, and US$8.1m in fiscal 2009.

The company's two biggest shareholders are Cede and Company which owns about 2.2m common shares, and Chairman and CEO Reggie Fountain, who owns about 2.1m common shares.

The company intends to continue operations, according to the court documents. Reggie Fountain told local news sources that only about 10 to 12 workers will remain on the site in the coming weeks. He also expects the backing of new private investors to be in place by the end of the month.

The court documents said Fountain's current operations would not be sufficient enough to support a traditional reorganization. Fountain's filings said "creditors would benefit from the sale of the Sale Assets to a third party, who would then be in a position to infuse working capital, make the necessary capital expenditures and maintain operations for existing and prospective customers, vendors and employees. The Debtors also believe that a forced liquidation of the Sale Assets by a Chapter 7 trustee or by Regions Bank exercising its state law remedies would result in no payment to unsecured creditors."

[Davidmnc]

Not good for our local economy. I hope it all works out Reggie. But we have been waiting for this ball to drop for months. Rumors running rampet from inside the company. Lots of good people looking for work.

[unitarious]

There probably is or will be a deal made to manufacture performance boats in the Bucyrus plant again. This could help that cause...

that would be nice

[Ratickle]

Dang, too bad.

Do you read that as he already has investor's lined up for a new "Fountain" to emerge?

[Sean Stinson]

Chris, though I am sorry for those in Bucyrus who lost their jobs when Baja went south (so to speak) I think your take is on the money.

The notion that Baja struggled because Reggie tried to "Fountainize" the line is rubbish. It cannot be backed by fact. Here's what can:

Baja dealers had huge new-boat inventory, moments before a huge recession. And the pre-owned stuff? Off the hook.

I am not pointing fingers in any way at anyone at Baja. But even in a robust economy, it would have been tough for Baja dealers to clear all their inventory in 2007 and 2008.

Because Reggie Fountain is something of a public figure, it's good sport to make fun of his personal style and all that. Fair enough ... you court the public, you take what you get from it. But regardless of what you think of Reggie or his product (Was it innovative or just good marketing?) the man has done as much, no, screw it, much more, than anyone, even Don Aronow to promote the high-performance boat industry.

Only an idiot, and I don't find many on this forum, would count him out.

Love him or hate him Reggie is the one solely responsible for bringing offshore powerboating to everyday america and beyond with his marketing techniques and campaigns!!!!!

[Davidmnc]

Dang, too bad.

Do you read that as he already has investor's lined up for a new "Fountain" to emerge?

Could stay in the family.

[DollaBill]

sad news

[Tank]

Love him or hate him Reggie is the one solely responsible for bringing offshore powerboating to everyday america and beyond with his marketing techniques and campaigns!!!!!

I'd have to disagree with that and this is the type of thought that has fed that HUUUUUGE ego of his, which I can't help but think aided this chapter 11 stuff.


You always hear people saying, "he's done more for power boating than anyone...blah blah blah...."

He's done more to promote HIMSELF than anyone I have ever seen in this sport, no doubt about that. But don't get it twisted, he could care less about promoting "the sport".

It's only us...Powerboat enthusiasts that truly see the hype he creates. "Everyday America" still calls offshore powerboats "cigarette boats" and most have no clue what a Fountain is.

His tv show was cool to watch but unless you were a fan of power boating, you most likely missed it. If you are a fan of power boating, you know that Fountain is a nice production boat, if you can get past Reggie's ridiculous antics.

By the way....Hows it going Sean!?

[32storm]

Too bad for the employees. It seemed like it was just going to be a matter of time. A boat is not on life's list of necessities for a lot of people out there. When the economy sours, it puts the brakes on those who want to dive in, and those that want to move up.That leaves only a small pool of buyers with $$'s out there. Not a good situation when you have geared your manufacturing facility around volume.

I doubt this will be the end of it. Who's going to be next...?

[Matt Trulio]

Tank (How the hell are you?),

With all due respect, who in business doesn't do most things in the name of self-interest? Of course Mr. Fountain's first and foremost concern has been promoting Fountain Powerboats. Goes without saying, just as Mr. Braver's first and foremost concern is promoting Cigarette and Mr. Hledin's first and foremost concern is promoting Skater. But the by-product of Fountain's relentless self-promotion was a greater awareness of high-performance boats within the boating world. Outside the boating world, no one knows. Or cares.

I have said it before and I'll say it again: Without self interest there is no interest. We are capitalists. We are profit motivated. I think the world of you, for example, but when it comes to making a living it's all about my own "good" first, baby.

So while you may not have liked Mr. Fountain's personal style or presentation, the by-product of his hard work (I don't think anyone can argue about that) was a greater awareness and a pushing, if you will, of the V-bottom performance-boat industry. It's fair to say that Fountain pushed Formula to step its hulls. (Formula designer John Adams has said this.)

From Skip Braver to Peter Hledin, Randy Scism to Bob Leach, I can't think of a single industry notable who doesn't give Mr. Fountain a ton of credit. Peer recognition says a lot, at least to me.

[Tank]

Tank (How the hell are you?),

With all due respect, who in business doesn't do most things in the name of self-interest? Of course Mr. Fountain's first and foremost concern has been promoting Fountain Powerboats. Goes without saying, just as Mr. Braver's first and foremost concern is promoting Cigarette and Mr. Hledin's first and foremost concern is promoting Skater. But the by-product of Fountain's relentless self-promotion was a greater awareness of high-performance boats within the boating world. Outside the boating world, no one knows. Or cares.

I have said it before and I'll say it again: Without self interest there is no interest. We are capitalists. We are profit motivated. I think the world of you, for example, but when it comes to making a living it's all about my own "good" first, baby.

So while you may not have liked Mr. Fountain's personal style or presentation, the by-product of his hard work (I don't think anyone can argue about that) was a greater awareness and a pushing, if you will, of the V-bottom performance-boat industry. It's fair to say that Fountain pushed Formula to step its hulls. (Formula designer John Adams has said this.)

From Skip Braver to Peter Hledin, Randy Scism to Bob Leach, I can't think of a single industry notable who doesn't give Mr. Fountain a ton of credit. Peer recognition says a lot, at least to me.

How's things been Matt?? Things are good here...Babies getting big. Had him out on the Cig this past weekend.

I started writing this rebuttal but as I wrote, I started agreeing with you, so I deleted it.

I don't quite buy the whole "he's done soooooo much for the sport" crap, like he's the second coming but he's done a great job promoting his boat (even if he lies to do so....). And you're right...I'm sure my disdain for him does purely lie with his BS antics.

Oh well, I still wish the company the best and hope they pull through....SEE! I can be the bigger man!!!!