Court allows Lamson to operate
Bankruptcy reorganization continues despite objections
SHELBURNE FALLS — In Wednesday’s continued bankruptcy hearing, Lamson & Goodnow Manufacturing Co. withdrew its request to borrow $500,000, while its largest creditor, Newtek Small Business Finance Inc., filed an objection to the cutlery’s bid for continued use of its cash collateral and for borrowing more operational funds.
However, the cutlery company is continuing to operate on its cash collateral, and will return to U.S. Bankruptcy Court in Springfield on Sept. 17.
Newtek, which lent the 177-year-old cutlery $2.05 million in December 2012, objected to allowing Lamson & Goodnow’s borrowing plan out of concerns that a new loaner, DIP Lending, would be the first creditor to be paid off, if the company’s future earnings are not enough to repay its principal creditors, Newtek and the US Small Business Association. The business association loaned the company about $1 million, and the cutlery’s 18-acre manufacturing complex on Conway Street is now for sale for $2.1 million.
Lamson’s Chief Operating Officer James Pelletier could not be reached for comment Thursday. However, the company’s lawyer, Gary M. Weiner of Weiner & Lange in Springfield, said the company hasn’t stopped operating since it filed for Chapter 11 bankruptcy protection while it tries to reorganize into a profitable company.
In other interviews since the Aug. 15 bankruptcy filing, Pelletier has said that 13 of the cutlery’s unionized staff were laid off, in addition to several employees from an earlier round of layoffs.
“Our union is on layoff until we call them back,” he said. “We will be discussing with them next week what their status is,” he said. The factory employs 31 workers.
Pelletier said Thursday that 29 people are currently working and being paid, but didn’t provide more information.