The Peek'n Peak Resort & Spa in Chautauqua County is still in business and operating as normal, despite the bankruptcy filing by its owner, the resort's president said.
"We're open and operating. There's no change in the operation at all whatsoever," president Robert Swenson said. "We're off to a good start to the season."
Kiebler Recreation LLC, owned by Paul E. Kiebler IV of Chardon, Ohio, filed for Chapter 11 bankruptcy protection and reorganization on May 26, the same day that Huntington National Bank initiated foreclosure proceedings on its mortgage.
According to the court documents, filed in federal court for the Northern District of Ohio, Kiebler has about $40 million in assets, and owes $28 million in secured debt and about $3.7 million in unsecured claims.
Specifically, Kiebler owes $15.6 million to Columbus, Ohio-based Huntington, $7.6 million to the Cross family, who previously owned the resort before Kiebler bought it in 2006, and $2.8 million to Pittsburgh-based PNC Bank.
The entity also owes about $1 million to "certain taxing authorities" and $1 million for "various capital leases." In addition, the 20 largest unsecured creditors were owed $2.67 million.
"It was strictly a voluntary situation to shore up our balance sheet and move financing along," Swenson said. "But we're operating as well as ever."
Peek'n Peak, with 315 employees, is the only business within Kiebler Recreation, although Kiebler himself has other unrelated investments.
The court on May 28 approved a request by Kiebler and the resort to dip into its cash collateral to pay vendors and suppliers, serve customers, meet payroll, cover other normal expenses and maintain routine operations of the resort.
Kiebler had argued that its debt was well below its net worth, and asserted it would have "positive cash flow" during the tourist season. The firm also granted Huntington replacement liens as protection for the bank's claim.
The company is currently negotiating with its creditors, but there is no expectation on how long the process will take. "We'll proceed as these things go and hopefully we'll be out of it shortly," Swenson said.