Zloop Inc. and two affiliates file for bankruptcy

Aug. 9, 2015, electronics recycling company Zloop Inc. and two affiliates, Zloop Knitting Mill LLC and Zloop Nevada LLC, filed voluntary chapter 11 petitions in the United States Bankruptcy Court for the District of Delaware.

The cases have been assigned to Judge Kevin J. Carey and are docketed as case no. 15-11660.

Zloop's Chairman and CEO, Robert M. Boston, filed an affidavit in support of the petitions.

Zloop has locations in Hickory, North Carolina; Perrysburg, Ohio; and Fernley, Nevada.

In his affidavit, Boston describes the debtors’ business as providing three types of services: "(i) end of life recycling for electronics or electrical equipment; (ii) on-site and off-site secure and audited data destruction; and (iii) preconsumer, postconsumer and mixed plastics recycling."

Zloop owns 100 percent of the membership interests in the other two debtors and 100 percent of the membership interests in Zloop International Ltd., a Belize limited liability company.

According to the petition, the debtors held approximately $25 million in assets and total liabilities of $32 million. Boston says the material debt concerns disputed debts owed to a franchisee relating to recision of a franchise agreement and other claims alleged to be owed to the same franchisee. Additional listed debt is a $3.5 million mortgage and about $400,000 in trade debt.

The debtor is not seeking additional financing but to use cash collateral to finance the chapter 11 cases.