The soup business made famous on “Seinfeld” is in hot water. Soupman Inc. (OTC: SOUP), based in Staten Island, New York, has short-term debt coming due and a working capital deficiency, filings with the U.S. Securities and Exchange Commission show.

The business makes and sells soups under the Original Soupman brand, and franchises and licenses restaurants. Additionally, Soupman soups are sold at the Mohegan Sun Casino in Connecticut, Resorts Hotel and Casino in Atlantic City, and to the New York City Public School System.

Al Yeganeh, the soup purveyor made famous by Larry David and Jerry Seinfeld's "Seinfeld" sitcom, is a special adviser to the company, overseeing production, quality control, new product and menu development. Yeganeh inspired the sitcom's "Soup Nazi" character, who sells soup only to customers who follow his strict rules in 1995 episode.  The company also owns and operates Al's original soup restaurant, on 8th Avenue and 55th Street in Manhattan.

About 40 percent of the business' revenue comes from packaged soups sold in stores, about 24 percent comes from the New York City school system and about 36 percent comes from franchises.

Soupman has more than $6 million in short term debt, which combined with its working capital deficiency, raises substantial doubt about its ability to continue as a going concern, or without the threat of liquidation, the company says in an SEC filing on March 19.

"We do not have sufficient cash to operate our business at the current level for the next twelve months," the company says. "While we believe we will require approximately $4 million to implement our full business strategy, we believe that if we are able to raise no less than $1.5 million, it will be sufficient to support our operations for the next 12 months. If we are unable to raise the entire $4 million, we will be forced to reduce our marketing and promotion efforts and potentially the size of our operations as well," the company says in an SEC filing.

Soupman says it wants to increase sales and distribution of its grocery products, open new franchise locations, and spend on advertising and marketing, but it needs money to do that.

Soupman had a net loss of about $1.3 million for the year ended Nov. 30. The business also had a working capital deficit of about $11.1 million and stockholders' deficit of $10.9 million.

Part of the company's losses is due to a recall. In September, the U.S. Food & Drug Administration told the Soupman to remove some of its products from shelves because of a mislabeling problem, which cost the company $180,000, according to the SEC filing.

The company's future rests on its ability to raise money to keep operating. In August, the company hired the Brand Initiatives Group to help with marketing. A representative did not immediately respond to a request for comment.

For the previous edition of Turnaround Tuesday, see Struggling Gunmaker Colt Defense Hires Restructuring Adviser. For more Troubled Companies, check out Mergers & Acquisitions Distressed Company Watch List. 

Food and beverage industry