1/14/2022 [Edition 1, Volume 11]
In many distressed situations, there are opportunities for clients to acquire assets at discounted prices. Gensburg Calandriello & Kanter is providing this bi-monthly summary of recent Chapter 11 cases filed in Illinois, Indiana, Wisconsin, Michigan and Ohio, as well as hospitality cases filed nationally, in which debtors (not necessarily clients of GCK) own assets that may be of interest, thereby making GCK clients aware of potential opportunities and ventures in the distressed assets market. Cases listed under “Assets for Sale” feature assets currently available. In cases listed under “New Filings,” the debtors have not yet found it necessary or otherwise decided to liquidate their assets, but may nonetheless be receptive to inquiries or offers to acquire some or all of the assets that they own.
New Filings
The following is an updating list of cases which are currently in, or entering chapter 11 bankruptcy. We hope that these summaries provide you with the ability to quickly determine the relevancy of any given case and gauge your level of interest in the assets contained within. If you need further information on any of the opportunities listed, please contact us by clicking here.
Illinois
General Freight Trucking – Chicago, Illinois
In re AJT Services, Inc. (Bankr. N.D. Ill.); Case No. 21-12986
- AJT Services, Inc. filed for relief under Chapter 11 of the Bankruptcy Code in the Northern District of Illinois on November 13, 2021. AJT Services, Inc. does not offer a company website, but does classify itself as a general freight trucking company; NAICS Code 4841. The Debtor states that it operates a holding company for its sister trucking and logistics companies, NAHaul, Inc., and Chicagoan Logistic Company. Its principal office is located at 3701 Algonquin Road, Suite 600, Rolling Meadows, IL. AJT Services, Inc. also discloses that its two (2) of its affiliates also filed for relief under the Bankruptcy Code in the Northern District of Illinois on June 5, 2021, Chicagoan Logistic Company (Case No. 21-7154) and NAHAUL, Inc. (Case No. 21-7152). Both affiliate companies are general freight carriers. Debtor estimates that its assets and liabilities are both worth no more than $50,000. That said, Debtor discloses that its largest unsecured creditors hold claims totaling $996,000, suggesting that Debtor’s valuation estimation may not be accurate. The only assets disclosed by Debtor are trucks/automobiles with a liquidation value of $300,000. Most of Debtor’s trucks are not paid off and are encumbered by secured claims totaling $500,000. On December 14, 2021, Debtor filed updated schedules that now show $1,241,553.97 in unsecured claims for deficiencies on truck rental agreement. No income has been disclosed by Debtor.
Restaurant – Chicago, Illinois
In re Cite LLC (Bankr. N.D. IL); Case No. 21-13730
- Cite LLC filed for relief under Chapter 11 of the Bankruptcy Code in the Northern District of Illinois on December 3, 2021. Located at 505 North Lake Shore Drive, Chicago, Illinois, Cite LLC states that prior to the bankruptcy filing, it operated a purported fine dining restaurant on the 70th floor of Lake Point Tower. It notes that additional condominiums owned by the Debtor are used to support the restaurant such as refrigerators, storage for food, kitchen equipment and other items utilized in the operation of a restaurant. Debtor estimates the value of its assets and liabilities to both be between $1,000,001 and $10 million. Debtor discloses and values its personal property as follows: $2,500 cash; bank accounts valued at $155,047.36; inventory and supplies, including liquors and wines, values at $35,000 based on replacement value; furniture, fixtures, and electronics valued at $350,000 also based on replacement value; and kitchen and service equipment valued at $50,000, based on liquidation. Also included in Debtor’s assets are numerous pieces of real property consisting of Suites 7000, 207, 209, 209-A, and 224 at 505 North Lake Shore Drive, with a total appraised value of $4,665,000. Further, Debtor discloses and values its liquor and entertainment licenses at $110,000 replacement value. In total, Debtor discloses liabilities of $7,945,223, comprised of $7,248,000 in claims by secured creditors and $697,223 unsecured claims. Debtor has not disclosed recent income nor a reason for bankruptcy.
Interior Home Remodeling – Downers Grove, Illinois
In re Kitchens & Spaces Cabinets Inc. (Bankr. N.D. IL); Case No. 21-13289
- On November 21, 2021, Kitchens & Spaces Cabinets Inc. (“K&S”) filed for relief under Chapter 11 of the Bankruptcy Code in the Northern District of Illinois. The Debtor states that it is in the business of selling cabinetry for installation in kitchens and other rooms in residential homes. K&S estimates that its assets are worth no more than $50,000 which includes bank accounts valued at $139.30; accounts receivable booked at $21,999.57; office furniture, fixtures, equipment, and appliances valued at $27,400.00; a 2017 Toyota Rav4 with a liquidation value of $16,500. K&S estimates its liabilities to be between $50,001 and $100,000, including a claim related to return of cabinetry valued at $31,883.00, one secured claim of $16,485.22, and unsecured claims totaling $64,941.67. The Debtor stated that it needed to file for bankruptcy in order to stay certain collection activities of judgment creditors who had served a citation to discover assets on the Debtor’s bank account and initiated other supplemental proceedings. Debtor discloses gross revenue of $811,885.00 for 2020 and $511,000.00 for 2021 to the failing date. Currently, Debtor has one pending petition to confirm an arbitration awarded in the Wheaton, Illinois Circuit Court and a concluded arbitration proceeding for breach of contract.
Grocery Store – Mascoutah, Illinois
In re Norrenberns Foods, Inc. (Bankr. S.D. IL); Case No. 21-30825
- Norrenberns Foods, Inc. filed for relief under Chapter 11 of the Bankruptcy Code in the Southern District of Illinois on December 7, 2021. Norrenberns Foods, Inc. is part of the grocery store industry, but is listed as “permanently closed” on Google. Debtor estimates that its assets have a total value of $500,001-$1 million and that its liabilities are between $1,000,001 and $10 million. Although Debtor has not yet disclosed specific assets, it does disclose that its largest unsecured creditors hold claims totaling $1,123,901. No income information or reason for bankruptcy has been disclosed.
Gas Station – Schiller Park, Illinois
In re O’Hare Shell Partners, LLC (Bankr. N.D. IL); Case No. 21-12756
- O’Hare Shell Partners, LLC filed for relief under Chapter 11 of the Bankruptcy Code in the Northern District of Illinois on November 8, 2021. O’Hare Shell Partners, LLC owns and operates a gas station/convenience store near O’Hare International Airport. Debtor estimates that both its assets and liabilities have a total value between $1,00,001 and $10 million. Debtor’s personal property consists of cash and bank accounts valued at $28,242.17; security deposits worth $13,000; goods and products held for resale valued at $238,645.36; office furniture, fixtures, and equipment valued at $13,000; pumps, sign, and other equipment related to gas station valued at $1,900,000.00. One piece of real property is disclosed by Debtor, the real property commonly known as 4111-4141 North Manheim Road, Schiller Park, Illinois, appraised at $8,500,000.00. Debtor’s Schedule G discloses several unexpired leases and executory contracts, including for purchase of gasoline for gas station, purchase agreements with vendors, and several food franchises that operate within Debtor’s convenience store. For 2019, Debtor discloses $7,893,152.23 of gross revenue from business and $205,690.74 of non-business revenue from renting space within its store. In 2020 Debtor reports $6,023,329.40 of gross revenue from business and $170,499.78 from non-business activities. For 2021 though the filing date, Debtor discloses gross revenue from business of $7,205,328.00 and $186,296.00 of non-business revenue. One foreclosure case is pending against Debtor in the Cook County Circuit Court. Secured creditors hold claims against Debtor totaling $5,374,659.31, while Debtor’s largest unsecured creditors hold claims totaling $547,641.78. Debtor has not yet provided a list or valuation of any specific assets, its income for the past three years, nor a reason for filing for bankruptcy.
Party and Special Events Products and Rentals – Elmhurst, Illinois
In re Paper Blast Co. (Bankr. N.D. IL); Case No. 21-12790
- On November 9, 2021, Paper Blast Co. filed for relief under Chapter 11 of the Bankruptcy Code in the Northern District of Illinois. The Debtor states that it owns and operates an internet based printing store related to banners and party supplies. Paper Blast Co. operates out of a 12,500 square foot building where all of its products are produced and sold. This is the second bankruptcy for Debtor, who disclosed that it also filed for bankruptcy on January 17, 2020 in the Northern District of Illinois (Case No. 20-01366). The estimated value of Debtor’s assets is no more than $50,000, while its total liabilities are estimated to be between $500,001 and $1 million. Despite this difference, Debtor estimates that funds will be available for distribution to unsecured creditors, which hold claims totaling $512,931.96. Disclosed by Debtor is personal property consisting of and valued at by Debtor as follows: bank accounts valued as $25,140.57; security deposits valued at $5,500; accounts receivable booked at $40,000; orders in progress and other inventory and suppose valued at $300; office furniture and electronics valued at $12,000; and business equipment valued at $3,800. Debtor discloses it owns copyright designs and a website domain name, but does not put a value on these assets. Secured creditors hold claims totaling $268,882.42 against Debtor. In 2019, Debtor reports gross revenue of $3,318,630.00, followed by gross revenue of $2,910,313.00 in 2020 and $2,524,260.38 in 2021 through the filing date.
Indiana
Railroad Services – Beach Grove, Indiana
In re Indy Rail Connection, Inc. (Bankr. S.D. IN); Case No. 21-05022-JMC-11
- On November 5, 2021, Indy Rail Connection, Inc. filed for relief under Chapter 11 of the Bankruptcy Code in the Southern District of Indiana. According to the Debtor, it operates a business that offers the railroad industry safe and responsive mobile dismantling and component inspection services. The Debtor states that it is related to Patton Mobile Dismantling which is owned and controlled by Steve Patton. It explained that in November 2020 an employee of Patton Mobile Dismantling was killed in a worksite accident that resulted in a lawsuit against several parties including the Debtor. As a result, the Debtor no longer conducts any physical work but rather contracts that out. It runs its service business using the expertise of Mr. Patton for sales, his sister for administration and an independent contractor for execution. The Debtor provided a balance sheet which disclosed bank accounts totaling $8,375.70, accounts receivable of $13,141.35, and machinery, equipment and vehicles which, after accumulated depreciation, have a value of $90,670.08. Debtor estimates its assets to be no more than $50,000, while it estimates liabilities to be between $500,001 and $1 million. Specifically, Debtor discloses that its secured creditors hold $140,000 in claims, its priority secured creditors hold claims totaling $45,000, and its nonpriority secured creditors hold claims totaling $653,935.27. For 2019 Debtor discloses gross revenue of $95,480. Gross revenue of $270,966 in 2020 and $247,236 of gross revenue in 2021 through the filing date.
Cargo – Greenwood, Indiana
In re National Cargo Inc. (Bankr. S.D. IN); Case No. 21-05256-JJG-11
- National Cargo Inc. filed for relief under Chapter 11 of the Bankruptcy Code in the Southern District of Indiana on November 19, 2021. National Cargo Inc. does not disclose information pertaining to its business operations, but a Google search shows that it is an interstate freight carrier that is authorized to move general freight. Debtor’s assets have a total estimated value of no more than $50,000. Debtor also estimates that its liabilities are between $100,001 and $500,000. After any administrative expenses are paid, Debtor estimates that no funds will be available for unsecured creditors. Debtor discloses and values its personal property as follows: bank accounts totaling $9,400; accounts receivable booked at $9,000; and office furniture and equipment valued at $1,200. No real property is disclosed by Debtor, nor does Debtor disclose any secured creditors. There are several collection cases Debtor is involved in, though, both in Johnson County Superior Court 4. Unsecured creditors hold claims totaling $170,180.32 against Debtor. For 2021 to date, Debtor discloses gross revenue of $943,288.00. Debtor also discloses gross revenue totaling $1,085,179.28 for 2020 and $1,193,032.86 for 2019. No reason for filing for bankruptcy has been disclosed by Debtor.
Wisconsin
Asset Management – Madison, Wisconsin
In re Greenpoint Asset Management II, LLC (Bankr. E.D. WI); Case No. 21-25900
- On November 11, 2021, Greenpoint Asset Management II, LLC filed for relief under Chapter 11 of the Bankruptcy Code in the Eastern District of Wisconsin. According to a Google search, Greenpoint Asset Management II, LLC offers financial management for businesses primarily within in the fields of engineering, accounting, research, and management services. Debtor also discloses that it is the managing member of Greenpoint Tactical Income Fund LLC and GP Rare Earth Trading Account LLC. Both of these entities filed for relief under the Bankruptcy Code in the Bankruptcy Court for the Eastern District of Wisconsin, GP Rare Earth Trading Account, LLC (Case No. 19-29617) and Green Point Tactical Income Fund (Case No. 19-29613). More recently, on November 11, 2021, Michael G Hull, the managing member of Debtor’s SO also filed for relief under the Bankruptcy Code in the Eastern District of Wisconsin Bankruptcy Court. Debtor estimates that its assets are between $1,000,0001 and $10 million. Liabilities, though, are estimated by Debtor to be between $50,000,001 and $100 million. That said, Debtor does anticipate that funds will be available for distribution to unsecured creditors. More specifically, Debtor reports total assets of $3,474,579.79 and total liabilities of $69,147,986.50. Of its total liabilities, Debtor discloses that its largest unsecured creditors hold claims of $45,790,560.93. No reason for bankruptcy or recent income has been provided by Debtor.
Hospitality
Hotel – Irondale, Alabama
In re Blue Chip Hotels Assets Group Birmingham East, LLC (Bankr. N.D. AL); Case No. 21-02685-TOM11
- On November 16, 2021, Blue Chip Hotels Assets Group Birmingham East, LLC d/b/a USA Economy Lodge, filed for relief under Chapter 11 of the Bankruptcy Code in the Northern District of Alabama, Southern Division. The Debtor has stated that it operates a budget 200 room hotel in Irondale, Alabama that offers basic amenities and service. The Debtor filed a balance sheet good as of October 31, 2021, which discloses bank accounts totaling $216,207.80, total current assets comprised of accounts receivable, obligations and security deposits totaling $972,561.72 and fixed assets comprised of real estate, building and improvements, and furniture and equipment $2,505,269.51. Liabilities total $3,170,322.12. The Debtor also filed a statement of cash flows from January through October 2021, which notes net cash provided by operating activities of $173,801.40.
Hospitality – Chambersburg, Pennsylvania
In re Hemani Hospitality, LLC (Bankr. M.D. PA); Case No. 21-bk-02416
- Hemani Hospitality, LLC filed for relief under Chapter 11 of the Bankruptcy Code in the Middle District of Pennsylvania on November 11, 2021. Hemani Hospitality, LLC stated that it is a limited liability company engaged in the hospitality business and operates a 73-room Baymont by Wyndham hotel in Chambersburg, Pennsylvania at 1122 Wayne Road, Chambersburg, Pennsylvania 1720 The Debtor has a management agreement with Krystal Penn, LLC, to assist with business operations. All employees are hired, supervised, and paid by Krystal Penn. All payroll taxes and filings are made by Krystal Penn Debtor estimates that its assets, including real estate and personal property, totals $4,396,704.10. Liabilities total $4,275,997.30, of which $3,515,797.30 represents secured debt.
Bed & Breakfast – Half Moon Bay, California
In re Princess Port Bed and Breakfast, Inc. (Bankr. N.D. CA); Case No. 21-30775
- Princess Port Bed and Breakfast, Inc. filed for relief under Chapter 11 of the Bankruptcy Code in the Northern District of California on November 23, 2021. As of the Petition Date (November 23, 2021), the Debtor in Possession held a fee simple interest in 445 Mirada Road, Half Moon Bay, CA 94019. The Debtor states that its property was used to operate a bed and breakfast business and monthly rental income was expected to fluctuate between $3,000 and $6,000 per month. The bed and breakfast appears currently to be closed. Two previous bankruptcy cases were filed by Princess Port Bed and Breakfast, Inc. in the Northern District of California – San Francisco, one on February 4, 2019 (Case No. 19-30118) and one on October 27, 2021 (Case No. 30727). Both Debtor’s assets and liabilities are estimated to be between $1,000,001 and $10 million. Debtor discloses and values its personal property as follows: $202 in cash; office fixtures, furniture, and equipment valued at $5,020; furniture, appliances, and supplies associated with the bed and breakfast with a combined value of $3,840. Debtor also discloses ownership of the real property commonly known as 445 Mirada Road, Half Moon Bay, California 94019, with a Zillow value of $2,576,500. This property is currently encumbered by two mortgages with a combined value of $1,425,000. Debtor’s largest unsecured creditors hold claims of $4,200.00. No income or reason for bankruptcy is provided in Debtor’s schedules, but Debtor’s schedules do suggest that it is no longer operational.
Resort – Sugar Land, Texas
In re Riverstone Resort, LLC (Bankr. S.D. TX); Case No. 21-33531
- On October 29, 2021, Riverstone Resort, LLC, filed for relief under Chapter 11 of the Bankruptcy Code in the Southern District of Texas. Riverstone Resort, LLC, classifies itself as a single asset real estate business which owns the real property commonly known as 2041 Hagerson Road, Sugar Land, Texas 77479 (“2041 Hagerson”). Based on a recent appraisal, 2041 Hagerson is approximately 75 acres and valued at $9,600,000.00. The Debtor states that the real property is unimproved except for the two acre tract. A single family residence is located on this tract. According to the Fort Bend County Appraisal District records, the main living area is 4,630 square feet and was constructed in 2003. An attached garage, car port, and two open porches add another 2,265 square feet. A 920 square foot swimming pool was added in 2006. The Debtor also notes that according to the Fort Bend County Appraisal District, other improvements on the two acre tract include a small residence of 441 square feet with two enclosed porches totaling 145 square feet which was constructed in 1940. Other improvements made in 2006 consist of a 1,219 square foot shelter, two storage units of 288 and 128 square feet, respectively, a 1,675 square foot stable and a 5,184 square foot area used as a horse arena. Two secured creditors hold claims totaling $1,904,913.82 that are secured by 2041 Hagerson. In addition to its real property, Debtor discloses bank accounts with a value of $20,007.08. Other assets disclosed by Debtor include several insurance policies and various unliquidated legal claims of an unknown value. Unsecured creditors also hold claims against Debtor totaling $261,038.01. For 2019, 2020, and 2021 to date, Debtor claims $0 of gross revenues for its business. Debtor is currently involved in two pending legal actions, one for unpaid real property taxes n the 458th Judicial District Court and a second suit for declaratory judgment in the 434th Judicial District Court.
NOTICE AND DISCLAIMER
The information contained in this article represents redactions from pleadings filed in the relevant bankruptcy case, supplemented, from time-to-time with data from the internet. Gensburg Calandriello & Kanter, P.C. has not independently investigated, nor verified the accuracy of this information and, therefore, does not make any representation or warranty whatsoever, express or implied, as to the content, accuracy or completeness of any of information contained herein, including, but not limited to (i) the value of any assets referenced herein, (ii) whether such assets are free from liens and encumbrances, or (iii) the environmental condition of any real estate. Therefore, while the information contained in this article is believed to be accurate, it should not be relied upon, and does not constitute legal or financial advice. Thus, parties reviewing or acting on this material must make an independent determination as to whether or not a particular course of action is generally appropriate.
Gensburg Calandriello & Kanter, P.C.
Lane Gensburg E. Philip Groben
Anthony Calandriello Alexis Clinebell
This information is based upon publicly available information and is intended to provide a brief overview of each opportunity.
Gensburg Calandriello & Kanter, P.C. | Attorneys at Law | WWW.GCKLEGAL.COM