Tedder Industries - Chapter 11 Case Summary

Business Description

Headquartered in Post Falls, ID, Tedder Industries, LLC (the "Debtor"), operating as Alien Gear Holsters, is a consumer-brand manufacturer within the firearms and accessories market. The Debtor specializes in American-made, injection-molded gun holsters known for comfort, quality, and modularity.

• The Debtor serves a diverse customer base through multiple sales channels, including institutional purchasers, business-to-business partners, and direct-to-consumer platforms.
• While initially focused on the civilian concealed carry market, product offerings have expanded to supply U.S. military branches, international militaries, defense organizations, and law enforcement agencies.

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Corporate History

Alien Gear was founded in 2010 by Thomas Tedder following a dissatisfactory experience with a third-party holster. Starting as a small operation in a kitchen and shed, Tedder designed his own holster, eventually growing the company into a prominent brand in the firearms accessories industry.

• The brand built its reputation on innovative hybrid leather-and-polymer holsters designed for concealed carry users.

Ownership and Capital Structure

The Debtor is majority-owned by the Main Street Entities, which are subsidiaries of Main Street Capital Corporation, the Debtor’s secured lender. The remaining voting equity is held by TI Holdings, LLC.

• To fund operations and growth, the Debtor secured a $23.3 million loan facility from Main Street Capital Corporation, comprised of a $21 million term loan and a $2.3 million revolving line of credit.
• The Debtor is governed by a board of three managers: Jesse E. Morris, Todd A. Leitgeb, and Founder Thomas Tedder.

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Operations Overview

The Debtor’s operations rely heavily on specialized manufacturing capabilities, a specific supply chain, and a dedicated workforce to maintain its reputation for quality and safety in the lethal-force accessories market.

Real Estate and Facilities

The Debtor’s offices and manufacturing facilities in Post Falls, ID, are located at a property originally owned by and leased from Thomas Tedder.

• The lease has expired, and the Debtor currently occupies the premises as a month-to-month holdover tenant.
• The Debtor defaulted on the December 1, 2025, rent payment of approximately $65,000 due to the timing of the Chapter 11 filing. Mr. Tedder has threatened to seek relief from the automatic stay regarding this default.
• Despite the dispute, the Debtor intends to remain at the location, citing that the current rent is below market rates and that relocating would cause severe manufacturing disruptions and cost significantly more than the current expense.

Supply Chain and Critical Vendors

The Debtor operates in a highly regulated and competitive environment where product failure can be a matter of life and death. Consequently, it relies on a network of Critical Vendors for manufacturing and eCommerce support.

• Manufacturing Vendors: The Debtor utilizes sole-source or limited-source vendors for custom parts. Switching vendors is difficult due to the extraordinary expense, delays, and the need for customer approval (particularly for military contracts) to use alternative parts.
• eCommerce Vendors: A significant portion of revenue is driven by consumer sales via an elaborate online system. The Debtor relies on interconnected technology, advertising, and shipping vendors to maintain this system.

Workforce

As of the Petition Date, the Debtor employs approximately 108 employees and utilizes approximately 21 non-employee contractors through a staffing agency, Humanix Corp.

• Employees are paid on bi-weekly or bi-monthly schedules.
• The Debtor views its workforce as essential, noting that many employees live paycheck to paycheck and that failure to pay prepetition wages could cause a decline in morale that would damage business continuity.

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Prepetition Obligations

As of the Petition Date, the Debtor reports approximately $25.05 million in outstanding obligations under its primary secured loan facility. The company’s prepetition capital structure also includes various employee, trade, and tax-related liabilities.

Secured Debt

• Approximately $25.05 million is outstanding under a Loan Agreement with Main Street Capital Corporation, as agent and lender. The obligations consist of approximately $23.08 million in term loans and $1.97 million under a revolving line of credit.
• The facility is secured by the Debtor’s assets, and a Deposit Account Control Agreement is in place over the Debtor’s bank accounts. The Debtor reports approximately $730,000 of cash on hand, all of which constitutes cash collateral.

Employee and Contractor Obligations

• The Debtor seeks authority to pay certain prepetition employee-related expenses, including:
  • $262,510 in gross salaries and wages.
  • $35,577 in associated employment taxes.
  • $19,549 in health insurance premiums.
  • A proposed $250 Christmas bonus for each of its 108 non-insider employees.
• Approximately $85,639 is owed to Humanix for non-employee contractor services.

Trade and Other Unsecured Claims

• Rent Expense: Approximately $65,000 was due on Dec. 1, 2025, for the Debtor’s leased property.
• Utilities: Approximately $11,725 is owed to various utility providers.
• Taxes and Fees: The Debtor estimates approximately $95,000 in taxes and fees are outstanding, with $90,000 due within 30 days of the Petition Date.
• Customer Programs: The value of outstanding gift cards is estimated at approximately $24,453.

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Events Leading to Bankruptcy

Financial Distress and Strategic Pivot

• Despite possessing a promising product line and significant market recognition—specifically regarding the Alien Gear trade name—the Debtor’s operations were hampered by an unsustainable capital structure:
  • The Company’s debt obligations significantly exceeded its current enterprise value, rendering it unable to service outstanding loans.
  • Confronted with these insolvency constraints, the Debtor determined that an immediate sale process was required to maximize the value of its intellectual property and tangible assets.

Liquidity Position and Cash Collateral Usage

• The Debtor entered the Chapter 11 process with approximately $730,000 in cash on hand, all of which constituted Cash Collateral. To prevent irreparable harm and the cessation of operations, immediate access to liquidity was deemed essential:
  • Operational Continuity: The Debtor secured consent from the Agent to utilize Cash Collateral to fund payroll, working capital, and Chapter 11 administrative costs, while ensuring the maintenance of critical relationships with vendors and suppliers.
  • Adequate Protection: In exchange for the use of Cash Collateral, the Debtor agreed to provide adequate protection for Prepetition Liens and granted a superpriority claim to the Agent, ensuring the arrangement remained fair and reasonable for all stakeholders.

Proposed Section 363 Sale and Stakeholder Support

• With the backing of its secured lenders and majority equity holder, the Debtor intends to utilize the Chapter 11 filing to implement a sale transaction pursuant to Section 363 of the Bankruptcy Code:
  • The strategy aims to leverage the "fresh start" provided by the bankruptcy process to make the Debtor an attractive prospect for potential purchasers.
  • The process is designed to monetize the Company's assets efficiently, preserving the inherent value of the brand while addressing the overleveraged balance sheet.