U.S. Tobacco Cooperative Files Chapter 11 in Reorganization Move
The filing also allows USTC to meet short-term contractual obligations to member-growers.
RALEIGH, N.C. — U.S. Tobacco Cooperative Inc. (USTC) filed for Chapter 11 protection in federal court for to meet short-term contractual obligations to member-growers during crop season 2021.
"This filing provides us the best way possible to meet our short-term obligations and plan for the future," said Oscar J. House, CEO and president of USTC. "In no way does this action reflect on the health of the organization and its ability to continue operations well into the future.
"In fact, this action is in response to the uncertainty presented by the ongoing class action litigation brought against us in 2005," House added. "Rest assured that our obligations to our member-growers, employees, suppliers and customers have always been and will continue to be our highest priority and concern."
USTC intends to satisfy obligations to its 550-plus member-growers and 200-plus employees, and suppliers and customers will continue to receive the service and products the organization is known for, according to the cooperative.
This filing will allow USTC to reorganize and restructure to honor commitments to stakeholders and ensure the organization's sustainable future.
Raleigh-based USTC a grower-owned marketing cooperative. It processes U.S. flue-cured tobacco grown by its member-growers in Florida, Georgia, South Carolina, North Carolina and Virginia. Member-grower tobacco is processed and sold as raw materials to cigarette manufacturers worldwide. Subsidiaries of USTC include U.S. Flue-Cured Tobacco Growers, Premier Manufacturing, Franchise Wholesale (dba Wildhorse Distributing), Big South Distribution and King Maker Marketing Inc.
USTC, through its subsidiaries also produces consumer products for the U.S. market under brand names of Wildhorse, 1839, Manitou, Shield, 1st Class, Ultra Buy and Traffic.