Basic Fun, a Florida-based toy design and development company that since 2019 has owned the Tonka toy brand, has filed for Chapter 11 bankruptcy protection as part of a financial restructuring plan.

Per regulatory filings with the U.S. Bankruptcy Court for the District of Delaware, leaders of the Boca Raton-based company estimated Basic Fun's debt to be between $50 million and $100 million, with fewer than 50 creditors. Its assets, the filing said, are less than $50,000.

The company is seeking approval of $50 million in debtor-in-possession financing, a specific type of financing for companies going through bankruptcy. The financing would come from affiliates of Great Rock Capital, plus a $15 million letter of credit from RBC and Basic Fun's founders, Jay Foreman and John MacDonald, to keep the business afloat during the restructuring proceedings, according to a release from the company.

Basic Fun acquired Tonka from Hasbro in 2019. Hasbro had owned the Tonka brand since 1991. Other toy brands owned by Basic Fun include My Little Pony, Lite Brite, Lincoln Logs, Care Bears and Tinkertoy.

In a statement, Foreman, also the company's chief executive and majority shareholder, said a number of setbacks led to financial distress for the business.

"Since the demise of our industry's largest toy retailer, Toys 'R' Us in 2018, through the tumult of the trade wars with China in 2019, COVID in 2020 through 2021, the travails of the supply chain crisis in 2022, inventory overstocks in 2023 and a consumer slowdown in the early part of 2024, our industry and Basic Fun have been through a gauntlet of challenges," he said. "We intend to use the restructuring process to put those challenges in the rear-view mirror, enabling us to secure a successful future and position us for growth and value creation."

Toys 'R' Us has reopened as a smaller player under new ownership.

Operated and based in Mound, a Twin Cities suburb, Tonka originally began in 1946 as Mound Metalcraft. Founders Al Tesch, Avery Crounse and Lynn Baker created the business to make metal items like tie racks and gardening tools. In 1947, Mound Metalcraft began manufacturing metal toys based on a toy steam shovel designed by Streater Industries, a Minnesota company later known for its retail merchandising displays.

The company gradually switched to predominantly toy manufacturing, with six employees assembling just two models, a steam shovel and a crane. Mound Metalcraft became Tonka Toys Inc. in 1948, named after nearby Lake Minnetonka.

By 1968, the company moved headquarters from Mound to offices just west of Minneapolis. Between 1974 and 1975, the company reached $102 million in annual sales and had facilities in eight countries. The Mound plant employed more than 2,000 people.

In 1983, Tonka closed the Mound plant and moved all manufacturing to El Paso, Texas, and Juarez, Mexico.