On Thursday, the Municipal Court in Prague declared bankruptcy on the property of Čezeta Motors. This company produces electric scooters Čezeta in Prostějov and has been in insolvency proceedings since last February due to millions of dollars in debts.
The court decided on the bankruptcy shortly after the second of the two managing directors, Daniel Gašpar, joined the insolvency petition for Čezeta Motors this week. He has so far been trying to find investors for the over-indebted company.
The insolvency petition was filed last February by Čezeta Motors, whose managing director and majority owner are Neil Eamonn Smith. He petitioned the court to declare bankruptcy over the assets of Chezeta Motors.
However, Gašpar and two of his creditors have long argued that the insolvency proceedings initiated last year were unnecessary as one of the creditors managed to raise CZK 6.5 million from investors for the project. The agreement with Smith was a condition for the transfer of the money.
Gašpar told the court on Tuesday that he no longer saw any other way for the company than to secure bankruptcy and expressed his concern that Smith was taking assets out of the company. He allegedly transferred intellectual property rights to his company, Rocketman.
The insolvency register shows that Chesapeake Motors’ liabilities last February amounted to CZK 13.273 million and its assets valued at CZK 5.265 million. The company’s debts thus exceeded its assets by roughly CZK 8 million.
Last February, Smith filed for insolvency against Chezeta Motors because the company had failed to find a buyer, and the owners were unwilling to put up enough cash to continue operations.
The company became insolvent and ceased production. For 2018 and 2019, the company reported a total loss of over CZK 21 million.