Jolt Cola maker files for bankruptcy protection
Jolt Co Inc, maker of the famous Jolt Cola energy drink, filed for bankruptcy protection in a Manhattan court on Monday, after a dispute with drinks can maker Rexam.
In court filings, Jolt said it agreed to buy 90 million 23.5 ounce resealable cans from Rexam between January 2007 and December 2009. However, because of the recession, the company has been able to buy just 27 million cans till date.
Jolt said it has to launch a non-resealable cans to compete in the market as the resealable cans supplied by Rexam cost three times the price of non-resealable cans.
The company added that it is unlikely to secure additional capital to pursue this strategy because of Rexam's claims and asserted liabilities.
In its Chapter 11 filing, Jolt, which does business as Wet Planet Beverages, listed assets and debt in the range of $1 million to $10 million. Rexam, which is owed about $2.1 million, was named as the largest unsecured creditor.
Jolt Cola was created in 1985 by C.J. Rapp as a highly caffeinated drink and is sold across the United States, Canada and Europe.
The case is In re: The Jolt Co Inc, U.S. Bankruptcy Court, Western District of New York, No. 09-22531. (Reporting by Santosh Nadgir in Bangalore; Editing by Anne Pallivathuckal)
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