Less than two months since announcing the closure of half its locations, San Diego-based Modern Times Beer has posted that the company's lender has commenced litigation that will inevitably lead to a court-ordered sale of the 9-year-old craft brewery.
"Our senior secured lender (AKA bank) tightly monitors the company’s finances and, though we have been working diligently with their officers over the past weeks, they have commenced litigation which we believe will result in a court-ordered receivership sale of Modern Times," reads a blog post entitled "An Update on the Immediate Future of Modern Times" on Modern Times Beer's website.
In mid-February, Modern Times Beer announced the impending closure of its Portland, Oakland, Santa Barbara, and Los Angeles locations due to financial issues. The company blamed the problems on the pandemic and global declines in the craft beer industry.AN UPDATE ON THE IMMEDIATE FUTURE OF MODERN TIMES
If you’ve been following us recently, you may know much like many others in the beer and hospitality
industry, Modern Times has been through a tough two years—tough enough that we’ve recently had to
make major cutbacks to both our personnel and our geographic footprint.
Let’s focus on the most important thing first. Modern Times remains committed to our drinkers, our brews,
and delivering great times when you visit us. Through the challenges, our coworkers, distributors, buyers,
drinkers, and patrons have been and continue to be vital to us.
The intense and rigorous work of restructuring the business coincides with other massive challenges:
revitalizing our remaining four tasting rooms and restaurants; struggling with rising gas prices; a
constrained trucking and logistics system; and supply chain issues with aluminum cans. As these issues
have intensified, so have our concerns about financials, cash flow, and profit.
Our senior secured lender (AKA bank) tightly monitors the company’s finances and, though we have
been working diligently with their officers over the past weeks, they have commenced litigation which
we believe will result in a court-ordered receivership sale of Modern Times.
So, what is a receivership? It’s complicated, but it boils down to this: our bank nominates someone to
oversee the sale of the Modern Times business. Once approved by the court, this nominated person, or
“receiver,” will be the final word on our financial decisions for the immediate future, and in charge of the
sale of the brand to interested parties.
While this isn’t a comfortable position for any company to be in, a receivership should hopefully allow
Modern Times to be sold as a “going concern,” as opposed to “turning off the lights” and liquidating the
equipment and inventory. A going concern sale would raise the odds of the new buyer keeping our
talented staff, amazing products, and renowned customer experience intact. Obviously, this is not an ideal
situation, but across a field of exceedingly difficult choices, it’s the best one available and is far
preferable to ceasing operations entirely. We expect this process to move swiftly. Financial
situation aside, we have an amazing brand.
On a more personal note—those of us who have experienced the last two years with Modern Times are
absolutely certain of one thing: none of us would still be here if we didn’t care deeply about this brand
and believe in its future. This has been an incredibly tough decision in a series of tough decisions; one
more difficult message to write in a long line of difficult messages. But we are not done, and we are not
giving up. Far from it. We’re still making amazing beer. We’re still roasting amazing coffee. We’re still
pressing forward, and we still believe that there are far better days ahead for both our staff and our fans.
We thank all of you for your continued support and patronage during these difficult times. It has meant
the world to us, and we’re still working hard to make sure it’s rewarded with many more beers, coffees,
and good times in the future.
More to come.
