Rykalskys concede ownership of bakery to Stache

Rykalskys concede ownership of bakery to Stache

A legal battle over ownership of the Edgewood Bakery has ended with Tom and Carol Rykalsky conceding that they do not have a majority ownership in the business.

The Edgewood Bakery remains temporarily closed while Stache Investments representatives take inventory and prepare it to reopen. Orders made prior to Friday, Feb. 27, are being honored but no new orders are currently being taken.

Stache Investments issued the following written statement: “Stache Investments aims to reopen the Edgewood Bakery as soon as possible, under experienced new management and on a solid financial foundation, following a period of reorganization for the business. We will restore it to the high standards of quality and service that Jacksonville customers have celebrated for generations. In the meantime, customers who made agreements with the previous operators for wedding cakes or other bakery goods needn’t worry. The new Edgewood Bakery will honor and fulfill their orders.”

At a hearing Friday, Feb. 27, before Judge James Daniel, the Rykalskys agreed with Stache Investment’s assertion that they only had 45 percent ownership of the longtime Murray Hill bakery, said their attorney Jack Webb.

As of noon that day, the Rykalskys were at the bakery meeting with employees while waiting to hear from Stache Investments about who would operate the business. “We haven’t been told that we’re terminated,” Tom Rykalsky said.

Webb said it became clear earlier this week when Stache Investments refused to pay a $12,000 insurance premium and was willing to allow a sale of bakery assets that the Rykalskys had lost their financial backer.

“It became obvious to me and to them that this thing was going to collapse under its own weight,” he said. “Rather than let the bakery fail and have people lose their jobs they decided to take this action.

“It’s better to have 45 percent of something than 55 percent of nothing, and to keep the bakery open and serving customers.

Stache Investments went to court in December seeking a receiver to be appointed until ownership of the business could be established. A receiver was appointed earlier this month and later reported to Judge Daniel that the bakery was financially insolvent and mired in debt.

However, the Rykalskys had continued to assert they had not given majority ownership of the bakery and wholesale business U.S. Culinary & Beverage to Shad Khan when they borrowed $800,000 from Stache Investments in June 2014 to buy the bakery.

Tom Rykalsky said he was still trying to process the events of the day. “This whole thing has been so bizarre. If I went back and told people the story of how we got to this point you wouldn’t believe it. It would make a good novel,” he said.

The Rykalskys issued the following statement:

“Thank you so much to all of our loyal customers, friends, neighbors, community business leaders, helpful vendors, beloved staff, and all who have supported us in any way over the past 8 months. Over the past several months, despite Stache’s efforts to take over Edgewood Bakery and force us to close this business down, Tom and I have done whatever was necessary to keep the bakery a family run establishment, pay our employees, produce and deliver promised goods, and keep the doors open with minimal impact to customers. Due to the Receivership, we were prohibited to continue to use our resources to manage and operate the business. The wholesale veggie muffin business, which is what this investment relationship was really all about to begin with, has been shut down and destroyed, and we were prohibited to sell assets, or wholesale items without Receiver and/or court approval to continue to fund Edgewood Bakery. When Stache withdrew from their OneSpark promises and ceased their approved funding for us, they sent us down a spiral. After Monday’s hearing, we felt that Stache was completely willing to continue to take measures, both actively and passively, to shut the doors of Edgewood Bakery unless we turned over control. Even if we did win this case in court, the very clear and present danger of their threats to foreclose on the property, even though we had no agreed upon payment plan, would force us to close down. We are not willing to see this long standing, well-loved establishment be forced to close. So, over the past few days, Tom and I have made some very difficult decisions regarding our future with the bakery. We are struggling with these decisions, but overall, we have decided that if we could ultimately help our community bakery, our patrons and our employees, by relinquishing majority control, we would and now, WE HAVE. In addition to the $130,000.00+ in accumulated legal fees, which just seem impossible for a family like ours, the emotional toil this has taken on our family, our staff, and now our customers, including future brides, was just too much to bear. So, we feel that we have done what is ultimately the right thing to do, however, we cannot make promises as to what Khan’s Stache Investments firm will do with the bakery.”
Sweetest Regards,
Tom and Carol Rykalsky

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