🥶New Chapter 11 Bankruptcy Filing - Norcold LLC🥶

Fridge company looks to preserve itself in chapter 11

On November 3, 2025, Ann Arbor-based,* Monomoy Capital Partners-owned Norcold LLC (“Norcold” or the “debtor”) filed a chapter 11 bankruptcy case in the District of Delaware (Judge Horan). Founded in 1959, the debtor distributes fridges for RVs and boats. Historically, it made ‘em too.

The trouble that gave rise to that switch ☝️ started in ‘10. At the time, the debtor exclusively manufactured “gas absorption” refrigerators — units powered by, e.g., propane or natural gas — and a problem emerged. To explain, we’ll turn to CRO and first day declarant Richard Wu of Alvarez & Marsal North America, LLC (“A&M”):

“Norcold determined that the refrigerator units’ boiler tubes were at risk of irregular corrosion, which could lead to gas escaping and pose a fire risk.

Apparently TSwift owns the debtor’s product.

Source: GIPHY

Anyway, Mr. Wu goes on:

This fault led to a major recall (the ‘Recall’) and a subsequent class action lawsuit in 2016. Norcold settled the class action lawsuit, which was not insured, for approximately $36 million, and the total costs associated with product liability were in excess of $80 million (excluding the class action settlement).”

Norcold addressed the underlying issue by thicc-ening the boiler tubes and installing temperature sensors, but a more profound question arose: WTH still uses propane-powered refrigerators?

Source: Tenor

Back to Mr. Wu:

“Around 2018, RV OEMs, which comprised Norcold’s primary customer base, began adopting DC compressor refrigerators leading to a steep decline in Norcold revenue. Then, the COVID-19 pandemic struck, and consumer demand for RVs surged. As one of only two suppliers of gas absorption refrigeration, Norcold was unable to meet this increased demand. This led OEMs to adopt DC compressor refrigerators at a higher rate, making both manufacturers and consumers more familiar and comfortable with the DC compressor technology. Although Norcold’s revenue increased with the market surge, it nevertheless sustained net loss given the legacy product liability cost overhang.”

The revenue pop naturally didn’t last, and net sales dropped 60% between ‘22 and ‘23. By then, the damage was already piling up: since ‘21, (i) Norcold has posted a net loss year in, year out, and (ii) net revenue has pluuuuuuuummeeeeteeeeeeed from ~$153mm to <$28mm projected for ‘25. Of course, market share also effectively resides six feet under.

To address the parade of horribles, Norcold closed its Ohio-located manufacturing facilities and sent ~500 Buckeyes to the Skyline Chili bread line in ‘22,*** which it followed up on, in ‘23, by (i) transferring its “limited” production of old tech gas fridges to a Euro non-debtor affiliate and (ii) converting to a “buy and sell” distributor of Chinese-sourced DC-powered products.

We’re not sold the world needs another Temu reseller; it has portable fridges covered.

Source: Temu

But the market will have a chance to speak because the debtor is gonna run a sale process. With a stalking horse too. Well, an affiliated one.****

The proposed buyer is Dave Carter & Associates, Inc. (“DCA”), which (i) is “… a leading national distributor of OEM components and building products to the manufactured housing, RV, modular construction, and specialty vehicle industries,” and (ii) sits to the left of the debtor on the org chart.

Source: Docket 2

DCA is proposing to pay $13mm for the debtor’s assets, inclusive of claims against itself and the standard list of affiliates and former/current officers and directors. Coincidentally, $13mm is also the exact amount DCA is funding under its proposed DIP ($6.5mm interim).*****

Anyway, it’s not like we expect anyone else to bid on this business. To make a good-faith effort, though, the debtor proposes the following ~85-day timeline …

Source: Docket 17. We can’t help but notice the debtor and DCA intentionally chose not to screw up the holidays for anyone (🙏).

… which lines up nicely with the debtor’s proposed timeline to approve its liquidating plan and disclosure statement (the “DS”) …

Source: Docket 53

The DS provides quite the range of recoveries for the debtor’s ~$4mm in GUCs and litigation claimants …

Source: Docket 21

… but to any holders out there reading this, it’s best you keep your expectations pegged at a 🍩. Y’all saw the most viable claims are going in the sale, right?

The Cerberus Business Finance Agency, LLC (“Cerberus”)-agented, debtor-guaranteed funded debt will fare better though because, while the debtor is on the hook for a ~$312mm prepetition term loan and an up-to $32.5mm prepetition revolver, the non-debtor borrowers will remain stuck with it and, moreover, DCA will assume the debtor’s guarantor role.

On November 4, 2025, the court held a quickie one-hour (🙌) first-day hearing, at which all requested relief was granted … after the US trustee objected to email-only notice, the court agreed to the extent the debtor has mailing addresses, and the debtor had no choice but to live with increased costs. Because the case isn’t in a rush, the second-day and bidding procedures hearing will follow on December 11, 2025 at 10am ET.

The debtor is represented by Young Conaway Stargatt & Taylor LLP (Sean Beach, Matthew Lunn, Jared Kochenash, Daniel Trager, Roger Sharp) as legal counsel, Alvarez & Marsal North America, LLC (Richard Wu) as financial advisor and CRO, and Hilco Corporate Finance, LLC (Teri Stratton) as investment banker. Michael Buenzow is the debtor’s independent manager. DCA is represented by Ropes & Gray LLP (Chris Dickerson, Conor McNamara) and Potter Anderson & Corroon LLP (Blake Cleary, Aaron Stulman) as legal counsel. Cerberus is represented by McDermott Will & Schulte LLP (Adam Harris, Reuben Dizengoff, David Hurst, Andrew Mark) as legal counsel.

*Go Blue!**

**J/K, we DGAF.

***Today, the debtor has no employees and relies on affiliates for services.

****Because it’s an insider, the stalking horse APA doesn’t include any bid protections.

*****The DIP bears interest at 10% PIK and features a 0.375% PIK unused line fee.

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Company Professionals:

• Legal: Young Conaway Stargatt & Taylor LLP (Sean Beach, Matthew Lunn, Jared Kochenash, Daniel Trager, Roger Sharp)

• Financial Advisor and CRO: Alvarez & Marsal North America, LLC (Richard Wu)

• Investment Banker: Hilco Corporate Finance, LLC (Teri Stratton)

• Independent Manager: Michael Buenzow

• Claims Agent: Stretto (Click here for free docket access)

Other Parties in Interest:

• DIP Agent: Dave Carter & Associates, Inc.

  • Legal: Ropes & Gray LLP (Chris Dickerson, Conor McNamara) and Potter Anderson & Corroon LLP (Blake Cleary, Aaron Stulman)

• Prepetition Agent: Cerberus Business Finance Agency, LLC

  • Legal: McDermott Will & Schulte LLP (Adam Harris, Reuben Dizengoff, David Hurst, Andrew Mark)