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.