Information for Creditors of O’Connor Construction Group, LLC
Case Number 22-40187 in the United States Bankruptcy Court for the Northern District of Texas
O’CONNOR CONSTRUCTION’S HISTORY
O’Connor Construction Group, LLC was founded over thirty years ago. It is a commercial/industrial contractor specializing in food storage and processing facilities, which provides turnkey design, construction, and construction management services for projects nationwide, according to papers filed in the bankruptcy case.
The Debtor has a history of success, a slate of projects that are currently underway, and even several projects slated to begin within the next six months. As of the filing of the bankruptcy case, O’Connor appears to have between $3.5 and $4 million in secured debt, plus an additional $10 million in unsecured debt. They also have projected revenues of roughly $11.8 million on their already-booked projects, plus plans to obtain more work in the ordinary course of their business.
THE BANKRUPTCY FOLLOWED SOME STATE COURT LITIGATION
While O’Connor Construction states in its opening papers that the COVID pandemic has caused some disruption to its business, that was not the primary reason for the bankruptcy filing. In the course of its business, O’Connor subcontracts some work out to specialized subcontractors. It fell behind on its payments to some of these subcontractors, who sued in Texas state court to get their money.
As a result of the proceedings and some quirks of Texas state law, the vast majority of the Debtor’s money was ordered to be given to the Texas court to hold while the court sorts out who should get the money. Roughly $1.2 million of the Debtor’s money is in the Texas state court, leaving the Debtor with less than $20,000 in its possession. It was this sudden cash shortfall that caused the bankruptcy filing.
INFORMATION IS STILL COMING IN
The papers that have been filed in the bankruptcy case so far indicate that there should be a profitable path forward for the Debtor. So, we do not believe that O’Connor Construction will go out of business, leaving nothing for creditors. Instead, it is likely that creditors will be paid at least some of what they are owed. How much is yet to be determined.
Before that number can be decided, the Debtor will provide a lot more information, including details about its finances – both assets and liabilities – and answer questions from the government and creditors.
Unsecured creditors may want to form a committee of unsecured creditors, which is a group that can be formed under bankruptcy law through which creditors can advocate for their own repayment. For more information on committees or the O’Connor Construction bankruptcy, please feel free to contact PRLT.
PRLT does not represent O’Connor Construction Group, LLC. The content on this page is provided for informational purposes only. Nothing on this page or this website creates an attorney/client relationship between you and PRLT. Nothing on this page is legal advice. If you have any questions about the O’Connor Construction bankruptcy case or anything discussed on this page, please contact us.