Posted 3/25/2014 04:17 pm
Updated 1 month ago
Simmons First National Bank of Pine Bluff sued Mountain Pure of Little Rock and its owner John B. Stacks last week for defaulting on $16.5 million worth of loans.
In a foreclosure lawsuit filed March 17 in Pulaski County Circuit Court, the bank also said Simmons First it wants a receiver appointed to take control of the water bottling company.
Stacks told Arkansas Business on Tuesday that he is hoping to settle the loans within a few days.
"I probably shouldn't make too many comments," he said. "I'm hopeful that we'll get things worked out in just a few days."
Simmons' attorney Jess Askew III of Little Rock declined to comment.
In its lawsuit, Simmons said Mountain Pure and its related entities began taking out loans and lines of credit in June 2004. Mountain Pure used its property in Pulaski County, Hot Springs and Mississippi as collateral. Other collateral included Mountain Pure's profits and equipment, the lawsuit said.
Over the years, the loans had been modified and extended. But Mountain Pure hasn't made a payment on its loans since Sept. 6, the lawsuit said.
As of March 10, Mountain Pure's outstanding principle balance was $15.4 million, and with late charges and interest owed, the payoff amount was $16.5 million. Interest is accruing at $1,370 a day.
Simmons said it wants to foreclose on the Mountain Pure property used as loan collateral if the judgment isn't paid by a date set by the judge. In the meantime, Simmons wants a receiver appointed to protect the company's assets.
Mountain Pure and Stacks "are under enormous personal and financial pressures and are unable to fund the operations of the facility, much less make timely payments to their numerous creditors," Simmons' said in its request for a receiver. "It is in the interest of all creditors that the Mountain Pure water bottling operations continue while this litigation is pending, if possible."
Simmons said Mountain Pure doesn't have the money to continue its bottling operations without damaging the bank's security interests.
A hearing has been set for April 16 in Pulaski County Circuit Judge Mackie Pierce's courtroom.
Mountain Pure is also facing lawsuits from two creditors seeking nearly $600,000 and an investor alleging securities fraud.
Stacks, who is also the CEO and principal owner of HomeBank of Arkansas, is facing 11 federal felony counts related to an SBA loan, which he received in 2009 after a tornado damaged his property at Damascus (Van Buren County). He has told Arkansas Business that the charges are "without merit" and has pleaded not guilty in court. His trial is set for the week of Sept. 29 before U.S. District Judge J. Leon Holmes.
Stacks also said Tuesday that in the last few weeks he has taken a leave of absence from HomeBank.
"So I could take care of a few of these things," he said. "I believe all of my issues are a result of my indictment."
He said he is launching a website, JohnStacks.com, later Tuesday to offer his take on the events surrounding his indictment. Stacks' case has attracted national attention in part because it was featured in an online video reenactment called "Rampant Injustice."
"There's a lot bigger picture and a lot bigger problem … that's going on in this country," Stacks said. "This is a lot bigger problem than just about John Stacks … It's about what brought this issue to where it is today."