There will be six Smashburger stores in San Diego location, together with a 10-store expansion deal, are open for auction in the bankruptcy of franchise SoCal Eats LLC.
Last January 8, the franchise operator declared bankruptcy and filed at the United States Bankruptcy Court for the Southern District of California.
The officials of Smashburger in Denver said that the bankruptcy was due to the capital infrastructure problems while the franchise operated.
In the court filings, it showed that Paraiso Culinary Ventures LLC was named as the bidder for the six stores and other assets with a proposal of $2.6 million which includes scrapping out the debt owed to their company in their previous dealings.
Paraiso is responsible for buying the five Smashburger units in Northern San Diego Country from SoCal Eats and other partners. Paraiso made a deal with SoCal Eats to run the six stores that are recently up for sale.
According to an asset recovery specialist in National Franchise Sales, Allan Gallup, the six stores are still operating and earning. He is the one handling the auction.
At the moment, David Whisenhunt who's listed as the SoCal Eats' managing partner, can not be contacted and have not said any word yet.
There are quite a number of restaurants and subsidiaries that are under SoCal Eats, that includes, SoCal Eats Kearny Mesa LLC; SoCal Eats College LLC; SoCal Eats Mission Valley LLC, SoCal Eats Point Loma LLC and SoCal Eats Market Street LLC. It used to be named as Smash Bros, but later decided to change to SoCal Eats LLC.
Vibra Bank is the primary creditor that claimed an estimate of $1.2 million based on the documents submitted. About $3.6 million unsecured claims were also claimed that was stated on the paper.
