The Comfort Suites hotel in Texarkana, Ark., is the target of a foreclosure complaint filed in Miller County Circuit Court this week by the bank holding a note for more than $2 million.
Louisiana-based MidSouth Bank's Monday filing names Texarkana Arkansas Hospitality, LLC, Sukhpal Singh and Harbans S. Grewal as defendants. Singh and Grewal reside in California, according to the complaint signed by Camden, Ark., lawyer Paul Lindsey.
Lindsey was out of the office Wednesday and contact information for the defendants was unavailable. Both MidSouth's complaint and the Arkansas Secretary of State's website state that Texarkana Hospitality's registered agent has resigned.
The complaint accuses Texarkana Hospitality of defaulting in several ways on a $2.5 million loan inked April 12, 2012, for construction of the Comfort Suites at 5420 Crossroads Parkway.
First, the bank alleges interest in Texarkana Hospitality at the time the loan was made was divided among Grewal, Sukhpal Singh and Jasbir Singh, who is not named in the complaint. The loan prohibits transfer of more than 25 percent interest in the property without the bank's consent. MidSouth's complaint alleges that about 45 percent interest in Texarkana Hospitality was transferred to three new members without the bank's knowledge in violation of the loan's terms.
"Plaintiff has also declared a default of the loan for defendant (Texarkana Hospitality's) failure to provide financial statements for the company and its equity owners, failure to pay late charges, failure to timely provide proof of payment of property taxes, and failure to timely pay regular monthly note payments," the complaint states. "The defaults provided in the notice have not been cured with the exception that defendant (Texarkana Hospitality) has paid the past due monthly installments."
According to MidSouth's complaint, Texarkana Hospitality has been required to make monthly payments of $15,564.63 since Aug. 12, 2013.
Miller County tax records show Texarkana Hospitality paid more than $48,000 in taxes May 31 for tax year 2014. The company currently has a 2015 tax bill of more than $45,000, which is due by October.
MidSouth sent default notices to the defendants March 30, warning that unless immediate payment of the loan's balance was made within 60 days, the bank would take steps to foreclose on Comfort Suites. According to the complaint, Texarkana Hospitality owed $2,281,903.79 in principal, $2,963.31 in interest, and $20,322.38 in unpaid late fees as of the filing of the complaint.
MidSouth is also asking for court costs and attorney fees. The case has been assigned to Circuit Judge Brent Haltom. The defendants have not been served with a copy of MidSouth's complaint for foreclosure.