Upscale sushi bar and steakhouse Seven has emerged from Chapter 11 bankruptcy protection under a reorganization plan that calls for eliminating hundreds of thousands of dollars in debt.
The reorganization plan for Seven—located at 700 Hennepin Avenue South in Minneapolis—was approved on October 27 in U.S. Bankruptcy Court in Minnesota.
“It’s strong, and it’s here to stay,” Seven’s founder, David Koch, said in a statement. Koch Group Mpls, Koch’s limited liability partnership, will continue to own and operate the restaurant.
“When we first got into the concept of Seven, the economy was strong,” Koch continued. “We opened for business, and you couldn’t get in. That first year, we dominated the city’s dining scene.”
Seven filed for Chapter 11 bankruptcy protection in April, saying that it owed between $1 million and $10 million to between 100 and 199 creditors.
Koch said that the reorganization plan received overwhelming support from creditors.
Under the terms of the plan, Seven will pay back a secured claim of $394,345, with 5 percent interest, to its largest creditor—Wayzata-based Carlton Financial Corporation—through monthly payments over an eight-year time span. Carlton holds collateral that it can opt to purchase at the end of the lease.
An additional $550,398 in unsecured debt is to be paid back to Carlton at 15 cents on the dollar—the same amount that’s to be paid back to other unsecured creditors.
Seven is to pay monthly installments of $7,000, including 5 percent interest, to the Minnesota Department of Revenue to pay off more than $283,830 in sales tax and withholding taxes that it owes.
Additionally, the Internal Revenue Service is to receive monthly payments of $2,770, including 4 percent interest, for the $110,613 in payroll taxes that it is owed.
