Multi-concept operator Star Buffet Inc. filed for Chapter 11 bankruptcy protection Thursday, citing a legal judgment and the inability to refinance mortgage obligations and its credit facility.
Scottsdale, Ariz.-based Star Buffet, which operates 4B’s and JB’s restaurants, among others, and its Summit Family Restaurants Inc. subsidiary, filed the petition in U.S. Bankruptcy Court in Arizona.
In a statement, Star Buffet said it would continue operations while the case is considered. The company also said it plans to appeal a $723,489 judgment against the company that led up to the bankruptcy filing.
“Although the company is profitable and has significant equity in its real estate portfolio, it has been unable to refinance current mortgage obligations or a Wells Fargo secured credit facility due in January 2012,” the company said.
The company said it was current in its payments on its $5.6-million Wells Fargo secured credit facility and $5.4 million in mortgage loans.
As of Aug. 15, Star Buffet showed assets of $22.4 million and liabilities of $21.4 million. Last fiscal year, the company had annual revenue of about $53 million.
Star Buffet and its subsidiaries operate seven 4B's restaurants, seven JB's restaurants, four Barnhill's Buffet restaurants, three K-BOB'S Steakhouses and two HomeTown Buffets, as well as one each of Casa Bonita Mexican, Whistle Junction, BuddyFreddys, Western Sizzlin, Holiday House, JJ North's Grand Buffet, Pecos Diamond Steakhouse and Bar-H Steakhouse.
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