The operator of seven Denny’s restaurants in Western Michigan seeks to restructure under federal bankruptcy protection.
In a Chapter 11 filing in the U.S. Bankruptcy Court for the Western District of Michigan in Grand Rapids, East Lansing-based JDJ Hospitality LLC lists liabilities of $4.3 million and $297,900 in assets from personal property.
Half of the liabilities listed in the filing come from a $2.2 million lien held by ECN Financial LLC in Horsham, Pa. Other secured creditors include Ascentium Capital LLC ($133,289) and Direct Capital CIT ($268,181).
In the filing, the company also said it owed $1.1 million to unsecured creditors, including $290,000 in back taxes to the IRS, plus $781,778 to the Michigan Department of Treasury and $44,573 to the state Unemployment Insurance Agency.
The largest operator of Denny’s restaurants in Michigan, JDJ Hospitality has locations in Kentwood, Holland, Muskegon, Grand Ledge, Lansing, East Lansing and Traverse City. The company leases all the sites from various landlords, according to court documents.
The seven restaurants employ about 250 people and will remain open during the bankruptcy proceedings.
The attorney for JDJ Hospitality, Cody Knight of Rayman & Knight in Kalamazoo, said the company voluntarily filed the bankruptcy petition “to restructure its operations to better position itself for the future.”
“JDJ has sufficient cash from operations to provide liquidity during the Chapter 11 and to support its continuing business operations and minimize disruption. JDJ believes pursuing a restructuring through Chapter 11 is the best path forward,” Knight wrote in an email to MiBiz. “JDJ is confident that the Chapter 11 process will allow it to reorganize and remain a strong franchisee of Denny’s Inc. JDJ has always enjoyed the support of its employees, vendors and Denny’s Inc. and expects the same support through this process.”