Chapter 11 bankruptcy would allow the debtor an opportunity to reorganize and offer up a plan to restore profitability while keeping creditors at arms length.
“It’s a positive thing, it’s a real positive thing,” Martin said about his filing in U.S. Bankruptcy Court. “It could be short, no big disaster.”
Martin’s bankruptcy petition was entered on Sunday, two days before Branch Banking & Trust filed a six-count civil suit against Martin seeking to recover $2,834,194.22 plus interest on notes that Martin has allegedly defaulted on. That case has been assigned to U.S. District Court Judge Harold L. Murphy in Rome.
The bankruptcy case has been assigned to Judge Mary Grace Diehl and a meeting of creditors has been scheduled for Jan. 9, 2013.
The bankruptcy petition lists the estimated number of creditors in excess of 100, with estimated liabilities of between $50 million and $100 million. The document also lists Martin’s assets at between $100 million and $500 million.
The petition lists more than 100 pages of creditors, including the city of Rome and Floyd County tax offices, Heritage First Bank, River City Bank, Citizens First, Greater Rome Bank, Bank of the Ozarks, United Community Bank, Regions, Wells Fargo and SunTrust.
Cartersville Sprinkler is listed as the largest unsecured creditor, owed $34,124. Ware Mechanical of Rome is the largest local unsecured creditor, with a bill totaling $17,976.
Martin has acquired hundreds, if not thousands, of properties, both land and buildings, across the Southeast during the course of the last three decades, and his cash flow on those properties has been significantly hurt by the recession of the last five years. A slew of his vacant properties have been damaged by thieves and vandals who have stripped them of copper tubing and electrical wiring to the point where it has taken tens of thousands of dollars to repair in a bid to make them rentable.
In terms of the collection process, government liens will have precedence over any other liens as far as collection through the levy process. The Internal Revenue Service and state of Georgia are among the creditors listed in the petition.
“We’re just going to be another creditor and they’re going to divide all the monthly payments up so we’ll get some monthly payments in his bankruptcy plan,” said Floyd County Tax Commissioner Kevin Payne. “He’s protected, so no one can take action against him while he’s in bankruptcy, so this helps him reorganize and come up with a solution.”
Earlier this month Martin was able to stave off a tax sale of more than a hundred properties in Floyd County largely by having lienholders agree to pay back taxes.
Payne said he was a little surprised that Martin did not file before his tax bills were due this year.
In March 2011 Martin attempted to sell properties in downtown Rome at auction to generate some cash flow but accepted only one of the bids at that sale, getting rid of the building at 326 Broad St., which was purchased by Joyce Greene Manning.
L Grif
Filing bankruptcy in NEVER "a positive thing, a real positive thing". Banks and creditors are going to take a hit, and Larry's credit is shot.
He filed Chapter 11, to re-organize but it could get a lot worse really quickly. His largest creditor is a bank that has FDIC backing. They are guaranteed 80% if they they foreclose. They aren't looking for a re-organization plan.They are looking for the federal government to pay them their 80% and that means they HAVE to follow the procedure to get their money. I look for them and others creditors to petition the court to force Larry into Chapter 9 and force a total liquidation of his assets. If that happens, the three local community banks who have been praying this would not happen, might just get sucked down the drain with Larry. Not all three, but him taking down 1 local bank os a real possibility if he gets forced into Chapter 9. And that doesn't count the crushing blow to local commercial property values if suddenly 150 properties hit the market all at once. This could get real ugly, real fast. No way this is "a real positive thing". It could be Rome's worst nightmare.
But I agree, this could be Rome's worst economic nightmare over last 50 years. Just praying he keeps his head above water and works through this situation. For the good of every commercial real estate property owner and every small bank in Rome. Anyone that thinks this will only hit Larry is nuts.
If the banks take his property and fire sale it, it is going to cause an economic crash in our market that will be unbelievable.
We are all pulling for Larry because this really could be huge hit to Rome, Georgia. Larry is addicted to making the next big deal. He should have quit when he hit 65. He's now mid 70's and owes somethig near $100M. I don't know how you sleep at night when you owe that much money. Let's all hope I'm wrong about Chapter 7.