Blenko Glass Co.is about to emerge from bankruptcy,and its owners say they're confident they can maintain and grow the market for the specialty glass they produce.
U.S.Bankruptcy Court Judge Ronald Pearson approved Blenko's reorganization plan at a hearing Wednesday afternoon.Toward the end of the hearing,Walter Blenko,who will head the reorganized company,said his expectation is that the company will continue to operate and find new markets.
"We have been working continuously and steadily to broaden our sales and spread out further,"Blenko said when Pearson asked if he had anything to say.
Blenko said the company is focusing for now on finding new customers at trade shows where it can display its products,as the showrooms that once displayed and sold Blenko glassware are about all gone.
Blenko is based in Milton and makes glass for the consumer market and for architectural use.In the past year,Blenko Glass has resumed making reproductions of old-style glass for Colonial Williamsburg,Blenko told Pearson.
"My expectation is that the company will continue to operate,"Blenko said.
He also praised the company's 45 to 50 employees for their loyalty.
Blenko Glass Co.entered Chapter 11 bankruptcy last year.Company attorney Steve Thomas told the court that the reorganization plan should take effect within 70 days.All creditors who voted on the reorganization plan approved it,including the Cabell County sheriff's office,which was the last to vote,Thomas said.
In the past,the sheriff's office has refused to accept less than the full amount for taxes due,but it has agreed to the payment plan listed in the reorganization plan,Thomas said.
According to court documents,Blenko Glass was founded by London native William John Blenko in the spring of 1922.It was incorporated in West Virginia on April 29,1947.
Blenko Glass produces handmade and blown glass consumer items,but it also has made stained glass for architectural use.Among other places,Blenko stained glass can be found at the United States Military Academy and the Pro Football Hall of Fame.
According to the court documents,Blenko once relied on the efforts of sales representatives who were compensated by commissions.At a time not specified in the documents,then-President Richard Blenko gathered the sales reps and told them the future of the company was not in their efforts but in TV promotions instead.
Blenko hired a film production company to produce two films for use on public television.Blenko glass products were also offered as gifts for people who made financial support to PBS stations during pledge drives.
Initially,the strategy worked,but sales through TV stations eventually dropped off.That coupled with the drop in other sales led to a cash flow shortage,according to court documents.Blenko stopped paying sales commissions as a way of conserving cash.The sales reps responded by not pursuing new sales.
About that time,Blenko Glass was having problems paying its bills for natural gas,which is used in the company's furnaces.Big Two Mile Gas Co.sued Blenko in 1994 over a past-due balance.The suit lingered on the court docket for more than 10 years.
In 2005,the case was transferred to Kanawha County Circuit Court,where Big Two Mile filed a motion for summary judgment.Richard Blenko apparently ordered his company's attorneys to not present"a full and vigorous defense"of the motion.Big Two Mile was awarded$540,336.90.Big Two Mile later received a judgment lien and an execution lien against Blenko.
Walter J.Blenko Jr.and Don B.Blenko Jr.,cousins of Richard Blenko,later invested in the company as a way of keeping it in business although they had not participated in management of the company before.Walter is a patent attorney in Pittsburgh,and Don is a real estate entrepreneur in Europe.
Since October 2005,the company's operations have stabilized but not enough to generate a sufficient return to pay anything to Big Two Mile or to Walter and Don Blenko for the loans they made.
Big Two Mile took several actions to recover its money from Blenko.Blenko Glass filed for Chapter 11 on May 12,2011.Although Walter and Don have continue to loan money to the company to enable it to pay administrative expenses of the case,the company has continued to lose money post-petition,according to court documents.
Court documents list two secured creditors:Don B.Blenko Jr.and Walter J.Blenko Jr.,$72,500 each.They also list 57 unsecured creditors who are owed a total of$4,439,648.21.The two Blenkos are among the largest of the unsecured creditors,totaling$3,105,548.75.Big Two Mile Gas Co.is owed$665,790.98.
Blenko Glass currently employs 45 to 50 people.In the past,it has sold glass through showrooms maintained by sales representatives.As the number of showrooms has declined,Blenko has shifted its marketing to regional trade shows.It also markets its glass through a website and an email list.
This year,Blenko Glass has also marketed its products through public television pledge drives.
"The Unsecured Creditors Committee has suggested that Blenko Glass should consider a'mass production'of products to be carried in national chain stores,such as the plan announced by Fenton Glass.The Company does not believe that a plan such as the one announced by Fenton Glass is feasible or would be advantageous for Blenko Glass.National chain stores focus on low cost.Blenko is a high-end handmade product which cannot and realistically should not compete with a mass produced product which is manufactured off-shore and cuts corners in the product.At the very best the result would be a high volume at no more than a marginal product,"bankruptcy court documents say.
