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The Colorado plant of NewAge Beverages will be sold under a planned Chapter 11 Plan of Liquidation.

The sixty-one-page document, filed on November 30th, describes NewAge’s Chapter 11 bankruptcy reorganization plan.

NewAge, Ariix, and Morinda will continue, while NewAge Beverages will be sold to Legacy Distribution Group for $4.5 million.

This is from NewAge’s proposed Chapter 11 Liquidation Plan.

NABC, Inc. and NABC Properties, LLC (the “NABC Entities”) are the parent company of two wholly-owned, non-Debtor subsidiaries that operate as a direct store distribution business providing beverages, snacks, and other products to grocers, big box retailers, and convenience stores (the “DSD Business”).

The DSD Company is based in Colorado.

NewAge Beverages is not identified, but I assume it is the referred “DSD Business” based on the business model description.

The Debtors filed a Motion for Entry of an Order (I) Authorizing the Debtors to Sell Property of NewAge’s Wholly-Owned, Non-Debtor Subsidiaries, (II) Authorizing the Assumption and Assignment of a Lease, and (III) Granting Related Relief on November 11, 2022 (the “DSD Sale Motion”).

The DSD Sale Motion requested permission for the sale of the DSD Business to Legacy Distribution Group, LLC (“Legacy”) for $4,500,000, subject to net working capital adjustments as detailed in the APA attached to the DSD Sale Motion.

The DSD Sale Motion also requested that Legacy acquire and transfer one of NewAge’s commercial leases, situated at 18245 East 40th Avenue, Aurora, Colorado 80011.

On November 23rd, NewAge’s request was granted.

CBD Global Sciences, a Canadian firm, owns Legacy Distribution Group (dba Global Sciences).

According to a press statement issued on September 9th;

The New Age DSD business has been serving the Colorado community for over twenty years, delivering best-in-class service to over 5,000 outlets and establishing and expanding some of the industry’s top brands.

From humble beginnings to becoming “one of the largest independent distributors in the country,” the DSD currently employs hundreds of people and is happy to carry on this wonderful “Legacy.”

“This is a good success for both Legacy Distribution Group and the Operations Team at the DSD,” said Brad Wyatt, CEO of Global Sciences.

In the Colorado market, our organizations have joined forces with the goal of providing best-in-class service to vendors and retailers.”

The reason I chose this section of NewAge’s Chapter 11 plan as the most important is that the Colorado bottling factory is critical to the product distribution of its MLM company.

Prior to the Chapter 11 proceedings, NewAge and Global Sciences had a commercial partnership that dated back at least to 2020.

Although not mentioned, I’m presuming a commercial agreement is in place to ensure that NewAge, Morinda, and Ariix may continue to push products via the Colorado factory.

Aside from the sale of the NewAge Beverages factory, the rest of the Chapter 11 plan involves disclosures we’ve already discussed. Specifically, what caused the bankruptcy, including claimed sabotage and extortion.

In the future, NewAge’s Chapter 11 Plan of Liquidation must be voted on, and the court will either affirm or reject it. This procedure will go through the first quarter of 2023.

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