Tag Archives: bankruptcy

Second-Largest Applebee'' s Franchisee Files for Bankruptcy Restructuring

Dealing with a potential loss of a few of its franchise rights, RMH Franchise Holdings Inc., the second-largest franchisee of Applebee’s dining establishments, has filed a petition for relief under Chapter 11 in the Bankruptcy Court.

Locateded in Atlanta, RMH operates 159 restaurants throughout 15 states that combined represent slightly less than 10 percent of all Applebee’s places.

“Substantial obstacles come across by the Applebee’s brand name usually, and particular managerial decisions made on behalf of it by its franchisor, Applebee’s International Inc. have adversely affected the debtors’ company operations and left them facing near-term liquidity issues,” Mitchell Blocher, primary monetary officer of RMH argued in insolvency court filings.

Applebee’s International is a division of openly traded Dine Brands Global.

Blocher stated RMH had remained in extended negotiations on a number of concerns relating to the operation of its company. Nevertheless, just prior to the insolvency filing this week, Applebee’s all of a sudden indicated that it planned to release a notice of termination of RMH’s franchise rights associating with locations in Arizona and Texas.

RMH operates 38 dining establishments in the two states.

Adding to the issues, the so-called “brass-and-plant” casual dining restaurant concept has seen much better days. Average yearly incomes for all franchised locations have actually been on a fairly steady decrease: $2.35 million in 2015, $2.18 million in 2016, and $2.09 million in 2015, inning accordance with Dine Brands information.

Nevertheless, the brand name has begun to publish a modest recovery of late. Applebee’s domestic same-restaurant sales increased 1.3% for the 3 months ended Dec. 31, 2017 from the very same duration in 2016, the first quarterly increase in two and a half years.

Particularly for RMH, for the trailing 12 months ending March 31, 2018, RMH generated $375.9 million in gross profits, and $12.6 million of operating profits, a drop of roughly 60% in two years from peaks of $431.1 million and $31.4 million.

It has actually not assisted that Applebee’s has actually had 4 presidents considering that the start of 2014, each being available in with a different set of efforts for franchisees, and which required additional capital expenditures from franchisees, Blocher said.

Dine Brands representatives informed CoStar, “Over the in 2015, we have worked along with our franchisees to return Applebee’s to favorable traffic and sales while consistently out-performing the [casual dining restaurant] classification. While this scenario is unusual and unfortunate, we’re pleased with our collective development at Applebee’s and very optimistic about our future, and the future of our franchisees. However, we can’t discuss particular litigation.”

Dine Brand has actually formerly reported that it is continuing to selectively refine its franchisee portfolio by shifting assets to other existing franchisees, along with some franchisees brand-new to the system. The most current example of this was the acquisition of a small number of dining establishments in South Dakota, Nebraska and Iowa by the Legacy Apple, one of its existing franchisees.

The business has actually reported that it anticipates making a handful of additional deals this year.

Last summer season, RMH employed Hilco Realty to renegotiate and/or amend leases to get lower rents, or negotiate lease terminations where proper. There has actually been no filings yet in the insolvency case concerning possible store closings.

Bon-Ton Files for Ch. 11 Personal bankruptcy Reorganization

Over the weekend, troubled department store chain The Bon-Ton Stores Inc. (OTCQX: BONT) applied for a court-supervised monetary restructuring under Chapter 11 of the United States personal bankruptcy code. The merchant stated it prepares to utilize the procedure to continue considering its choices, including a sale of the company or its properties.

The relocation was anticipated after the company formerly revealed plans to close 47 stores in 2018. Bon-Ton said it has received a dedication from its existing asset-backed loan providers for approximately $725 million in debtor-in-possession (DIP) funding.

With corporate headquarters in York, PA and Milwaukee, the retailer runs 256 stores, that includes nine furniture galleries and 4 clearance centers, in 23 states in the Northeast, Midwest and upper Great Plains incorporating roughly 24 million square feet. It runs under a number of banners: Bon-Ton, Bergner’s, Boston Shop, Carson’s, Elder-Beerman, Herberger’s and Younkers nameplates. It owns 22 of its stores.

“Bon-Ton, with a substantial geographic operating footprint and operating existence, depends on shop traffic, which has reduced as customers move increasingly toward online retailers,” Michael Culhane, CFO of Bon-Ton Stores, stated in the company’s personal bankruptcy filing.

In 2017, the business generated approximately $2.55 billion in total revenue and has actually been attempting to reorganize about $880 million in financial obligation. It failed to make a $14 million interest payment in December.

Last month, Moody’s Investors Service downgraded Bon-Ton Stores based on missed out on interest payment however still within a 30-day grace duration, and stated the lowered score reflects a high likelihood of default. Moody’s stated it believes Bon-Ton’s debt level is unsustainable at existing levels.

The company has significant leverage, with unadjusted debt/EBITDA expected to go beyond 10.9 times by the end of Bon-Ton’s current ; and weak protection, with EBITDA less capital expenditures expected to be insufficient to cover interest costs, Moody’s stated.

For the very first three quarters of last year, Bon-Ton published a loss of $135.4 million compared to a loss of $108.1 million for the very same duration a year earlier. Similar store sales decreased 6.6% in the period “due to unseasonably warm weather condition and the extension of soft shopping mall traffic trends,” the business reported.

More info on Bon-Ton’s store closure strategies can be discovered in our previously released story Financial obligation Load Forces More Bon-Ton Store Closures, Personal Bankruptcy an Alternative

Upgraded: Debt Load Forces More Bon-Ton Shop Closures, Personal Bankruptcy an Option

Struggling department store chain Bon-Ton Stores Inc. (OTCQX: BONT) disclosed today that it has actually participated in restructuring discussions with some of its lenders after cannot make necessary interest payments last month.

The chain said it has actually proposed a more detailed, two-year reorganization plan with the lenders, including the decision to close or offer more of its shops.

Last November, the chain revealed plans to close about 40 stores following sales decreases in the third quarter.

Consisted of in that proposition, which Bon-Ton launched to its stockholders this morning, was that it was completing a “more strict review” of its existing shop portfolio.

Bon-Ton, with corporate headquarters in York, PA, and Milwaukee, WI, runs 260 shops, which includes 9 furniture galleries and four clearance centers, in 24 states in the Northeast, Midwest and upper Great Plains under the Bon-Ton, Bergner’s, Boston Store, Carson’s, Elder-Beerman, Herberger’s and Younkers nameplates. Yearly profits are roughly $2.5 billion.

The portfolio includes a variety of poorly carrying out shops that “contribute very little value,” according to the business, and are siphoning working capital and management attention far from the more lucrative shops in its chain.

[Editor’s Note: This story was upgraded Feb. 1, 3 pm with the list of shop closures and extra information from the company.]

The retailer has actually been evaluating 100 of its worst-performing shops and chose to close 42 shops; another 20 or more shops that need to be kept an eye on for additional signs of degeneration, three others that might be offered.

“As part of the comprehensive turnaround strategy we revealed in November, we are taking the next actions in our efforts to move forward with a more productive store footprint,” stated Costs Tracy, president and CEO for The Bon-Ton Stores. “Including other just recently announced store closures, we anticipate to close an overall of 47 stores in early 2018. We stay focused on executing our key initiatives to drive enhanced performance in an effort to strengthen our capital structure to support the business moving forward.”

The typical aspect of the group of shops being, the business said, is that they are located in “dying malls and centers struggling with overwhelming competitive pressures.”

The business said it could also produce up to $4 million in lease cost savings from the awaited closings across the remainder of its portfolio that it would keep.

With the minimized store portfolio, the business likewise prepares to consider combining its variety of distribution centers from 3 to two.

At the very same time, Bon-Ton store stated there is a chance to purchase new shop openings, especially in markets where Macy’s has actually been deserting space. The company said it has seen a significant uptick in sales in markets where Macy’s has actually currently closed stores.

Bon-Ton is predicting opening 14 new shops over the next three years.

In its ongoing settlements, Bon-Ton stated it has not yet reached an agreement on mutually appropriate terms and conditions with the noteholders and that there are no assurances that it will.

Meanwhile, the retailer said it is continuing to seek an equity sponsor as well as examining liquidation alternatives. The business stated it has currently gotten liquidation quotes for all its stock. Those bids would suffice to cover its outstanding asset-backed loan contracts, excluding any potential insolvency costs.

Previously this month, Moody’s Investors Service downgraded Bon-Ton Stores based on missed interest payment but still within a 30-day grace duration, and said the lowered ranking reflects a high likelihood of default. Moody’s said it believes Bon-Ton’s debt level is unsustainable at existing levels.

The business has considerable leverage, with unadjusted debt/EBITDA expected to surpass 10.9 times by the end of Bon-Ton’s existing fiscal year; and weak coverage, with EBITDA less capital expenditures expected to be insufficient to cover interest expenses, Moody’s said.

For the first three quarters of in 2015, Bon-Ton posted a loss of $135.4 million compared with a loss of $108.1 million for the very same period a year previously. Similar shop sales reduced 6.6% in the duration “due to unseasonably warm weather and the continuation of soft shopping center traffic trends,” the company reported.

However, the outlet store chain hasn’t published a revenue since 2012.

Store Closure List
Shop, Mall, City, State
Herberger’s, Pine Ridge Shopping Center, Chubbuck, Idaho
Carson’s Clearance Center, Aurora Shopping Mall, Aurora, Illinois
Carson’s, Riverside Plaza, Chicago, Illinois
Carson’s, Village Shopping center, Danville, Illinois
Carson’s, Northland Plaza, DeKalb, Illinois
Carson’s Clearance Center, Town Plaza, Morton Grove, Illinois
Bergner’s, Sheridan Town, Peoria, Illinois
Carson’s, Streets of Woodfield, Schaumburg, Illinois
Carson’s, Mounds Mall, Anderson, Indiana
Carson’s, Fair Oaks Shopping Mall, Columbus, Indiana
Carson’s, Concord Mall, Elkhart, Indiana
Carson’s, Circle Centre Mall, Indianapolis, Indiana
Carson’s, Five Points Shopping Mall, Marion, Indiana
Younkers, College Square Shopping Mall, Cedar Falls, Iowa
Younkers, Westdale Mall, Cedar Rapids, Iowa
Elder-Beerman, Kentucky Oaks Shopping Center, Paducah, Kentucky
Elder-Beerman, Adrian Shopping Center, Adrian, Michigan
Carson’s, Orchards Shopping mall, Benton Harbor, Michigan
Herberger’s Clearance Center, Birch Run Station, Maplewood, Minnesota
Bon-Ton, Steeplegate Mall, Concord, New Hampshire
Bon-Ton, Phillipsburg Shopping Mall, Phillipsburg, New Jersey
Bon-Ton, Air Travel Shopping Mall, Queensbury, New York
Bon-Ton, Salmon Run Shopping Center, Watertown, New York
Elder-Beerman, Northtowne Shopping Mall, Defiance, Ohio
Bon-Ton, The Point at Carlisle Plaza, Carlisle, Pennsylvania
Bon-Ton, The Commons, Dubois, Pennsylvania
Bon-Ton, Millcreek Mall, Erie, Pennsylvania
Bon-Ton, The Johnstown Galleria, Johnstown, Pennsylvania
Bon-Ton, Susquehanna Valley Shopping Mall, Selinsgrove, Pennsylvania
Bon-Ton, Nittany Mall, State College, Pennsylvania
Bon-Ton, Stroud Shopping Center, Stroudsburg, Pennsylvania
Bon-Ton, Trexler Mall, Trexlertown, Pennsylvania
Herberger’s, Cache Valley Shopping Center, Logan, Utah
Younkers, Fox River Shopping Mall, Appleton, Wisconsin
Boston Store, Heritage Town, Beaver Dam, Wisconsin
Elder-Beerman, Eclipse Center, Beloit, Wisconsin
Younkers, Forrest Shopping Center, Fond Du Lac, Wisconsin
Younkers, Lakeshore Edgewater Plaza, Manitowoc, Wisconsin
Younkers, Evergreen Mall, Marinette, Wisconsin
Boston Shop Clearance Center, 5659 S. 27th Street, Milwaukee, Wisconsin
Younkers, Mariner Shopping Mall, Superior, Wisconsin
Younkers, Wausau Center Mall, Wausau, Wisconsin
Formerly Declared
Bon-Ton, Valley Mall, Hagerstown, Maryland
Younkers, Westwood Shopping Center, Marquette, Michigan
Bon-Ton, St. Lawrence Centre, Massena, New York
Bon-Ton, University Shopping Mall, South Burlington, Vermont
Elder-Beerman, Grand Central Mall, Vienna, West Virginia

Haggen grocery store chain declare bankruptcy defense

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Courtesy

A number of Vons and Albertsons stores throughout the valley were converted into Haggen grocery stores in June.

Wednesday, Sept. 9, 2015|10:56 a.m.

BELLINGHAM, Wash.– The little grocery-store chain Haggen, which recently broadened in the Las Vegas location, has filed for bankruptcy defense.

The Bellingham Herald reports that President John Clougher said the reorganization will permit the Bellingham-based Haggen to continue to run while making it possible for the grocer to re-align its operations. Creditors have actually committed as much as $215 million to keep the business running while it offers stores.

Haggen applied for Chapter 11 security on Tuesday.

The struggling grocer, which went from a household business to a West Coastline power virtually overnight after buying 146 stores from Albertsons, released a statement saying it would focus on profitable core shops while in speak with offer numerous of the company’s continuing to be possessions.

Previously this month Haggen sued Albertsons for more than $1 billion in damages, alleging the grocery store huge participated in methodical efforts to remove it as a sensible rival in five states.

The lawsuit, submitted in federal court in Delaware, implicated Albertsons of anti-competitive practices. Albertsons stated the claim was without merit.

Earlier this year, Haggen purchased 146 Albertsons and Safeway shops, expanding from 18 shops in Oregon and Washington into brand-new markets in California, Nevada and Arizona.

5 things to bear in mind as the Caesars bankruptcy progresses

More than six months after a significant division of Caesars Home entertainment Corp. applied for bankruptcy, it’s still uncertain precisely how the business will certainly emerge on the other side.

Caesars wants a Chicago bankruptcy court to authorize a restructuring strategy that could shed around $10 billion in debt from the department, however suits from a few of the company’s creditors remain to complex things. One current court choice in certain threatens to produce huge problems for the whole gambling establishment business.

If Caesars’ plan succeeds, the division that filed for bankruptcy will be restructured under a realty investment trust setup that will split it into 2 parts: one that possesses casinos and another that manages them. That setup would have Caesars follow in the footprints of other gambling establishment business– consisting of Penn National Gaming, the business purchasing the Tropicana– that have actually made comparable moves toward realty financial investment trusts.

Despite the remaining concerns surrounding the complex bankruptcy case, however, some basic elements stay clear. Here are a few of the main points you have to find out about where the case stands.

1. Caesars Palace is the business’s only Las Vegas home consisted of in the bankruptcy for now.

This has actually held true all along, however it deserves restating.

Caesars Home entertainment is a large company that’s split into several departments. The only division that filed for bankruptcy in January was Caesars Home entertainment Operating Co., which has been referred to as the largest of the company’s units.

Appropriately, the only Las Vegas building consisted of in the initial bankruptcy filing is Caesars Palace. That means all Caesars’ other buildings on the Strip– such as the Flamingo, the Paris and the Linq hotel– were not. However, that may change (see next point).

Other locations where Caesars operates weren’t so lucky. Harrah’s Reno, Harrah’s Lake Tahoe, Harveys Lake Tahoe, Caesars Atlantic City and Bally’s Atlantic City were amongst the buildings consisted of in the bankruptcy filing in January.

So what does being a part of the filing indicate for Caesars Palace? Not much at the minute. The building– similar to other Caesars casinos– is open for business as typical, the company says.

2. However current events suggest the whole business could go into bankruptcy.

The case hit a crucial milestone recently, and it did not workout well for Caesars.

Judge Benjamin Goldgar refused to shield the Caesars moms and dad business from suits by its lenders while the operating department is in bankruptcy. Caesars is appealing the choice, however it was rejected a demand today that would have sped that process along.

That has further complicated the company’s effort to stop fits versus it prior to a judge in New York “can think about imposing billions of dollars in liability on the father and mother,” Bloomberg reported.

Caesars has said the fits could force the father and mother business into bankruptcy too.

The lenders’ lawsuits normally pertain to the legitimacy of asset transfers Caesars made prior to the bankruptcy. The business is standing its ground.

“Our company believe our defenses in the New York litigation are strong and will remain to contest those cases vigorously,” Caesars spokesperson Stephen Cohen said in a statement after Goldgar’s ruling last week. Cohen stated the ruling was a “technical analysis of bankruptcy law and did not resolve in any method the merits of the New York litigation.”

3. At the same time, Caesars has actually made development in gathering support from creditors.

Days before the ruling recently, Caesars announced that a “substantial quantity” of second-lien financial obligation holders signed an arrangement that gives them a “substantial enhancement” in what they can recuperate from the bankruptcy. Holders who sign the contract might get 2 various sets of $200 million in convertible notes, the company said.

Caesars requires more than 50 percent of its second-lien debt holders to sign the arrangement for it to become efficient. The business did not state last week exactly how close it was to that objective, but Bloomberg reported that the group owned about 30 percent of junior notes.

Caesars stated the moms and dad company and the operating division were working to record further support of the contract.

4. The case itself has actually already become really expensive.

A case as complicated as this one is bound to produce a substantial stack of legal bills. And they’re piling high: According to the Associated Press, the Caesars case resulted in about $47 million in professional charges and costs from Jan. 15 through completion of May.

UNLV law teacher Nancy Rapoport is leading the fee committee that’s evaluating all those costs. She said in a previous interview that such committees normally consider the ratio of the charges to everything else going on in the case. It’s “normally very proportional” to the amount of cash at stake in the overall case, she stated, “however it’s still a lot of money.”

5. It’s going to take a very long time to fix.

Don’t hold your breath for a conclusion to this case anytime quickly. According to Bloomberg, Caesars’ initial plan visualized an exit from the bankruptcy by Feb. 9, however its more recent strategy is to emerge by July 15 of next year.

Bankruptcy court rejects Caesars Entertainment'' s fast appeal

Thursday, July 30, 2015|8:41 a.m.

. A bankruptcy court that ruled lawsuits against Caesars Home entertainment Corp. would not be stopped as the company’s debt-heavy subsidiary efforts to emerge from Chapter 11 has actually also denied the casino business’s effort to fast-track an appeal of the decision to a greater court.

The order was rejected Wednesday in Judge Benjamin Goldgar’s federal courtroom in Chicago according to court records.

A Caesars Home entertainment lawyer has suggested the fate of its broke operations subsidiary and its own monetary health are at danger if creditor suits seeking billions of dollars in claims proceeds.

The lenders taking legal action against Caesars allege the company robbed its subsidiary of important possessions and left them without a guarantee on their investments.

Caesars Entertainment Corp. has actually suggested the litigation puts Caesars Entertainment Corp. at danger of filing bankruptcy itself.

Ask a Lawyer: If I file bankruptcy, can I keep my residence and vehicle?

Sunday, May 31, 2015|2 a.m.

Click to enlarge photo

By Lawyer Xenophon Peters, Partner, Peters and Associates, LLP

Today’s concern was asked as a follow-up to the “Answering Your Bankruptcy Concerns” post we released in February. It’s a question I hear frequently in my daily practice because lots of Nevada homeowners want to keep certain property in their bankruptcy. The brief answer? In many cases, yes.

Usually, if you file a Chapter 13 bankruptcy, you’re going to pay back a part of your debt in the form of “strategy payments” throughout 3 to 5 years. As long as you make those plan payments and stay current on any payments for your house and automobile, you have the ability to keep your house. If you lag on your automobile or mortgage payments, “catch up” payments commonly can be included in your Chapter 13 strategy so you do not lose your property.

There’s a slightly various set of rules that apply when you file a Chapter 7 bankruptcy. A Chapter 7 Trustee might take away home you own that’s not exempt from collection. Thankfully for Nevadans, our state’s laws– the majority of which are contained in NRS 21.090– provide very charitable exemptions when you file bankruptcy.

Specifically relating to a vehicle, you’re permitted to keep “one automobile if the judgment debtor’s equity does not exceed $15,000.” That indicates as long as your automobile’s equity– the difference in between what you owe on the vehicle note and exactly what the car deserves– is less than $15,000 and you remain existing on your payments, you generally can keep the automobile. Additionally, you might be able to keep any automobiles that have negative equity, however contact your attorney.

For residences, the policies are comparable. You can keep your owner-occupied home as long as your equity in it does not go beyond $550,000 and you have actually submitted the correct homestead declaration documentation on the building. Specific time restrictions might apply.

There likewise are a number of other bankruptcy exemptions that apply in Nevada for products such as guns, works of art, precious jewelry, farm equipment, electronics, and so on. There’s even an exemption for up to $500,000 of CASH if it’s part of a retirement account– which is why you need to never ever tap a 401(k), pension or IRA account to pay debt prior to speaking with a lawyer.

In summary, in many cases, bankruptcy filers can keep everything they have. Your lawyer’s essential job is to develop a debt relief strategy that works for you and protects as many of your possessions as possible.

If you have a concern you want to see answered by a lawyer in a future concern, please write to [email protected]!.?.! or visit PandaLawFirm.com. Kindly note: The info in this column is

meant for basic functions just and is not to be considered legal or expert recommendations of any kind. You need to consult that is particular to your issue before taking or refraining from any action and should not count on the details in this column.

UNLV law professor is a crucial gamer in Caesars Entertainment bankruptcy case

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Courtesy

Nancy Rapoport

Wednesday, May 20, 2015|2 a.m.

Although the Caesars Entertainment bankruptcy is playing out in a Chicago court far from Nevada, it’s still closely connected to Las Vegas, including through one regional scholastic associated with the case.

UNLV law teacher Nancy Rapoport was recently designated to lead a committee that reviews expenses for legal work as well as other professional fees and expenses tied to the Caesars bankruptcy procedures. Rapoport, a specialist in bankruptcy law, will certainly thus be a vital gamer as the Las Vegas-based casino giant seeks to restructure one of its departments in court.

Caesars Entertainment Operating Company declared Chapter 11 bankruptcy defense in mid-January. The flagship Caesars Palace resort is the only Las Vegas building had by the bankrupt division. The other Caesars buildings on the Strip are controlled by different parts of the business.

Caesars wishes to embrace a property financial investment trust setup for the bankrupt department, and it hopes to eliminate about $10 billion in debt through its organized restructuring. But arriving– or to whatever result the case produces– is anticipated to be a long, dragged out procedure. For starters, not all parties concur about the very best path forward. Some Caesars lenders are combating the company about corporate maneuvers that they say unfairly robbed the broke department of value. A court-appointed examiner is investigating the allegations. Appropriately, a military of legal professionals is working on the case, which is acquiring a sizable stack of bills. That’s where Rapoport can be found in.

She’s the chairperson of the fee committee, which includes 5 members. Rapoport is the committee’s independent member, a position that court papers say need to be

held by a”disinterested” person. The other committee members represent numerous celebrations with a stake in the case as well as the united state Trustee Program, an arm of the Department of Justice that supervises bankruptcies. Rapoport explained her work as assisting the court take a “very first cut “at identifying the reasonableness of expert expenses, such as costs for lawyers and advisers. Those expenses can be high: Rapoport stated that in other cases, she’s seen them stretch up of$ 75 million to as much as$500 million. That can make sense, nevertheless, considering how much money is involved in the case.”One of things that we take a look at is the ratio of those costs to the total stuff that’s going on in the Chapter 11,”Rapoport said.”When you put it in the context of just how much money is at stake overall, it’s usually quite proportional. However it’s still a lot of money.”Although the committee investigates the reasonableness of these fees, the bankruptcy court ultimately decides who does and does not make money, Rapoport said. However her duties– for which she prepares to get the aid of UNLV law

students and graduates– can save the court a great deal of legwork. When she played a similar role in the Station Gambling establishments bankruptcy case, Rapoport said her students and graduates saved the court a minimum of 2,000 hours of time. This case presents distinct difficulties for Rapoport since of its inherent complications and its jurisdiction.”The cases I have actually been involved in have been Texas and Nevada cases, so there’s a learning curve right here that makes

it challenging for me personally, and the intricacy of the case is high,”she stated.”The principles are the

same, however every case provides novel problems that the committee is going need to work though.”They’ll be working for a while. Rapoport stated the committee will certainly meet for as long as the case lasts, which she stated won’t be”years and years and years,”however might conveniently be around one year,”depending upon how things play out.”