LUBBOCK, Texas — FirstCapital Bank of Texas on Thursday asked a bankruptcy judge to pull the plug on Reagor Dykes. More specifically, FirstCapital asked the judge to stop any and all reorganization plans in favor of liquidation. The bankruptcy case would go from a Chapter 11 to a Chapter 7 case.
Reagor Dykes filed for bankruptcy in August 2018. The Lubbock-based auto dealerships were accused of fraud and default. Twelve former employees have admitted to committing federal felonies and will be sentenced at a later date.
FirstCapital said the various Reagor Dykes companies are worse off now than a year ago. FirstCapital revealed in court records that a proposed plan sponsor backed out.
“Most notably, there is no hope for identifying a new Plan Sponsor,” FirstCapital said.
FirstCapital also said the losses are exorbitant after the bankruptcy began.
- $3,284,489 at Reagor-Dykes Motors
- $2,094,937 at Reagor-Dykes Amarillo
- $2,439,535 at Reagor-Dykes Imports
- $2,094,729 at Reagor-Dykes Floydada
- $2,883,853 at Reagor-Dykes Auto Company
- $1,588,819 at ReagorDykes Plainview
- $2,777,367 at Reagor Auto Mall
- $723,616 at Reagor-Dykes Snyder
“In sum, the Debtors report post-petition cumulative losses of almost $18 million through 2019 year-end,” FirstCapital said. FirstCapital stands to lose $12 million, according to court records.
FirstCapital also said the value of Reagor Dykes will continue to lose money. The issue is scheduled for a court hearing on February 12.
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