The Little Mint: $11M Restructuring Preserves Hwy 55 Chain

The Little Mint, Inc., the North Carolina operator and franchisor of the Hwy 55 Burgers, Shakes & Fries chain, filed for chapter 11 on December 31, 2024 in the U.S. Bankruptcy Court for the Eastern District of North Carolina, case number 24-04510-5-JNC. The filing put a 93-location restaurant system into a reorganization built around continued use of secured lenders' cash collateral, a contested fight over lien priority among five secured creditors, and a plan that preserved sole owner Kenneth K. Moore's equity.

Rather than a sale or liquidation, the case followed a reorganization path that ended in a consensual confirmed plan. The court confirmed the amended plan on November 6, 2025, with an effective date that the plan and confirmation order place at December 1, 2025. The reorganized debtor continues to operate Hwy 55 and, through the first half of 2026, has run a heavy claims-reconciliation campaign against equipment lessors while litigating a single financial-advisor fee dispute that has become the most contested late-stage matter on the docket.

Debtor	The Little Mint, Inc.
Court	U.S. Bankruptcy Court, Eastern District of North Carolina
Case Number	24-04510-5-JNC
Petition Date	December 31, 2024
Confirmation Date	November 6, 2025
Effective Date	December 1, 2025
Secured Debt at Filing	Approximately $11.0 million
Unsecured Debt at Filing	Approximately $5.8 million

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Hwy 55 Operator and the Path to Chapter 11

The Little Mint operates and franchises the Hwy 55 concept, a counter-service burger chain founded by Kenneth K. Moore in 1991. Moore stated in his first-day affidavit that the current debtor entity resulted from a July 27, 2023 merger of three predecessor companies and that he remained the company's 100% owner on the petition date. The system spanned 93 locations across six states at filing — 22 company-operated stores and 71 franchised stores in North Carolina, South Carolina, Georgia, Florida, Tennessee, and Texas.

The company entered bankruptcy after shrinking its corporate footprint. The first-day affidavit states that the debtor had already closed 13 corporate locations before filing and employed about 530 people, roughly 30 salaried and 500 hourly. Store closures continued into 2025 as individual Hwy 55 restaurants went dark, and the filing prompted coverage of closure risk across the franchised system.

Moore's affidavit attributes the filing to a combination of 2022–2023 operating losses, failed efforts to secure growth financing, COVID-era labor shortages, supply-chain and inflation pressure, and accounting mismanagement that left taxes and vendor obligations unpaid. In March 2024, nine months before the petition, The Little Mint entered a compliance agreement with the U.S. Department of Labor and was assessed $11,453 in civil money penalties following child labor violations at its restaurant locations. The same affidavit identifies escalating collection pressure from food distributor Performance Food Group as an immediate catalyst for the December 31 petition. The case is part of a broader wave of restaurant-franchisee distress, in which operators carrying leveraged store portfolios have struggled against higher interest rates, inflation, and tightening vendor terms.

Prepetition Capital Structure and Secured Lenders

Moore stated that the debtor entered chapter 11 with about $11.0 million in secured debt and about $5.8 million in trade and other unsecured debt. The first-day affidavit identifies five parties asserting liens against the debtor's assets: the U.S. Small Business Administration, Johnson Breeders, Inc., CSC, Institution Food House, and Performance Food Group. The overlap of those claimed interests across the debtor's accounts, inventory, general intangibles, royalties, and equipment set up the priority disputes that dominated the first half of the case.

The overlapping secured positions drove the case's central contested matters — the terms on which the debtor could spend cash, which creditor's lien attached to franchise royalties and receivables, and how each secured claim would be treated under a plan. The voluntary petition and accompanying first-day package framed the reorganization around stabilizing the corporate store base while resolving those overlapping liens.

Cash Collateral and Lien-Priority Disputes

Because the debtor's operating cash was encumbered by the secured lenders, early practice centered on cash-collateral authority. The amended cash-collateral motion identified the debtor's inventory, accounts receivable, general intangibles, payment intangibles, and proceeds as collateral claimed by multiple secured parties, and sought continued use of cash collateral through the earliest of the effective date of a confirmed plan, a sale of substantially all assets, or a conversion of the case.

To protect the secured lenders during that period, the motion offered replacement liens, continued segregation of cash-collateral receipts, monthly reporting to secured parties, and a process allowing objections or termination requests on three business days' notice. The debtor framed cash-collateral access as essential to continuing payroll, utilities, customer programs, and ordinary-course operations while it rejected unprofitable leases and stabilized the store base, per the first-day affidavit.

Cash-collateral practice ran across a long series of interim orders. Those orders imposed budget controls, monthly reporting, and recurring adequate-protection payments, including $40,000 monthly payments to Johnson Breeders alongside additional payments to Performance Food tied to its asserted claim positions. By an August 28, 2025 hearing, debtor's counsel told the court that the cash-collateral dispute had been resolved, and the amended plan carried the adequate-protection structure forward into its treatment of the secured classes.

Johnson Breeders moved to the center of the case on January 29, 2025, when it filed a motion to determine the extent, validity, and priority of certain liens. The creditor asserted a secured claim of about $4.1 million and asked the court to rule that its liens in the debtor's accounts and general intangibles were senior to the competing asserted interests of the SBA, Austin Business Finance, and Performance Food. The motion tied those rights directly to franchise fees, royalties, and other revenue streams that allegedly constituted cash collateral, linking the priority dispute back to the debtor's ability to fund operations.

Performance Food's position evolved across several disputes before resolving. The amended plan ultimately addressed Performance Food's claim in two pieces — a trust component under the Perishable Agricultural Commodities Act and a separately treated secured component — and the confirmation record reflects that Performance Food supported the plan. With the Johnson Breeders and Performance Food positions resolved, the debtor proceeded to a consensual confirmation.

Amended Plan and Class Treatment

The debtor filed its original plan and disclosure statement on May 30, 2025 and an amended plan and amended disclosure statement on September 19, 2025. The amended plan defines the effective date as the first day of the month following entry of the confirmation order, assuming no stay remains in place — the mechanic that produces the December 1, 2025 effective date.

For Johnson Breeders, the amended plan states a fully secured claim of $4,316,497.02 as of July 31, 2025. The plan continues the $40,000 monthly adequate-protection payments through the pre-effective-date period, then provides post-effective-date interest at the greater of 8.5% or New York prime plus 1.0%, with three additional months of $40,000 payments followed by longer-term amortization and an outside maturity no later than seven years after the effective date. The SBA's claim is treated with the general unsecured class under prior orders, and the plan requires termination of the SBA's financing statements within 30 days after the effective date.

Performance Food's split treatment separates a $184,143.49 PACA claim from a $1,015,069.39 secured claim. Under the plan, the PACA amount is paid in full over 12 months at SOFR-level interest, while the secured piece receives six months of interest-only payments followed by seven-year amortization at 8.5%.

Non-insider general unsecured creditors received a multi-part package rather than a single distribution. The confirmation materials describe a $500,000 base payment spread over five years, annual sharing of a portion of post-tax cash flow for 2026 through 2030, recoveries from bankruptcy causes of action, and 25% of net proceeds from a qualifying liquidity event through December 31, 2030. The confirmation order carried that treatment into the confirmed terms and contemplated a post-confirmation committee to monitor those unsecured-class disbursements and pursue estate causes of action, with the official committee terminating on the effective date.

The plan left Kenneth K. Moore's equity unimpaired and allowed him to retain his ownership interest in the reorganized company.

Confirmation and the December 2025 Effective Date

At the October 30, 2025 confirmation hearing, debtor's counsel described the plan as consensual, Performance Food stated that it supported the plan, and the bankruptcy administrator supported confirmation. The court asked for a final confirmation order incorporating targeted revisions, and entered the order confirming the plan on November 6, 2025.

The confirmation order set the post-confirmation guardrails for the case. It imposed a 60-day administrative-claim bar date for claims other than court-approved professional fees, required quarterly fees and post-confirmation reports through entry of a final decree, and required the debtor to file a final report and a motion for final decree within 30 days after substantial consummation.

On the professional side, debtor's counsel Hendren, Redwine & Malone, PLLC filed an interim fee application on March 3, 2025 seeking $140,964.50 in fees plus $2,407.90 in expenses for services from the petition date through early March. Committee counsel Waldrep Wall Babcock & Bailey PLLC later filed a final application covering August 2 through November 6, 2025, requesting $35,821.00 in fees and $736.10 in expenses and stating that committee counsel's total administrative claim, including prior awards, was $83,366.30.

Post-Confirmation Claims Reconciliation

The post-effective-date docket is dominated by claims reconciliation rather than a quick path to a final decree. The reorganized debtor opened a broad objection campaign with a February 5, 2026 omnibus objection to certain claims, followed by a wave of mid-February objections targeting specific equipment-finance and lease claims. The objections generally sought to reduce or disallow claims, frequently arguing that a creditor failed to credit abandoned equipment or that the claim amount was otherwise overstated.

A March 25, 2026 batch of orders disallowed equipment-finance claims asserted by Amur Equipment Finance, Macquarie, m2 Equipment Finance, GreatAmerica Financial Services, Data Systems, Channel Partners Capital, and Centra Funding. An earlier March 12 batch had addressed general unsecured and vendor claims, including disallowance of the Moelis & Company, Heartland Payment Systems, James Barnes, and Ascentium Capital claims, reclassification of the Everidge LLC claim, and consent resolutions with TN Capital and Empire Unlimited. The court held a dedicated hearing on equipment-deficiency claim objections on April 1, 2026, and the reconciliation continued through a series of April and May consent orders and approved settlements with lessors including Ameris Bank, Dext Capital, Marlin Leasing, LEAF Capital, TimePayment, and Pawnee Leasing.

The largest single negotiated resolution was the JB&B Capital compromise. On March 2, 2026, the reorganized debtor moved to approve a compromise with JB&B Capital resolving four disputed claims, under which the JB&B claims would be allowed as general unsecured claims while JB&B surrendered its remaining rights in the associated restaurant equipment. The court entered the consent order on March 30, 2026, allowing four JB&B claims — originally filed as secured but amended to unsecured on November 19, 2025 — under Class XV of the confirmed plan: Claim 115 at $52,977.03, Claim 116 at $4,145.77, and Claims 117 and 118 at $9,237.71 each. JB&B surrendered all interests in the associated equipment, which the order deemed property of the reorganized debtor free and clear.

The debtor's own reporting shows the reorganized business operating and paying creditors through the reconciliation period. The first-quarter 2026 disbursement report records total disbursements of $3,115,399.66 — $1,047,773.58 in January, $951,174.21 in February, and $1,116,451.81 in March — and a quarterly U.S. Trustee fee of $24,923.30, of which $24,923.00 was paid. The report defines disbursements as total bank-account activity, including operating expenses and payments to secured creditors and lessors, and does not itemize distributions to the general unsecured class. The objection campaign continued into the spring with a May 4, 2026 omnibus objection to unsecured claims and additional individual objections.

Dundon Advisers Fee Dispute

The compensation of Dundon Advisers LLC, the official committee's financial advisor, became the most contested late-stage matter in the case. Dundon filed a final fee application on April 29, 2026 seeking total compensation of $96,924.50 in fees and expenses for its committee work.

On June 3, 2026, the debtor objected to the Dundon application on multiple grounds. The debtor argued that the firm's hourly rates were unreasonable for the Eastern District of North Carolina and had been increased mid-case without notice, noting that the court had previously deemed Dundon's rates unreasonable in other local cases. It contended that many of the firm's services duplicated work by debtor's and committee's counsel, that some work — including an apparently incomplete preference analysis — provided no clear benefit to the estate, and that Dundon billed for legal work, such as preparing settlement proposals, outside a financial advisor's scope. The debtor also argued that Dundon's delay in filing — more than a year after its employment and months after confirmation — hindered the debtor's management of administrative expenses. The debtor asked the court to reduce the award by 30%, or $29,077.35, to an allowed claim of $67,847.15, and to spread payment over 12 to 18 months. A compensation hearing on the application was noticed for the dispute.

Key Timeline

Date	Milestone
2024-12-31	Chapter 11 petition and first-day affidavit filed
2025-01-15	Amended cash-collateral motion filed
2025-01-29	Johnson Breeders filed lien-priority motion
2025-05-30	Original plan and disclosure statement filed
2025-09-19	Amended plan and amended disclosure statement filed
2025-10-30	Confirmation hearing held
2025-11-06	Confirmation order entered
2025-12-01	Effective date under plan mechanics
2026-02-05	Post-confirmation omnibus objection to certain claims filed
2026-03-02	JB&B Capital compromise motion filed
2026-03-30	Consent order resolving JB&B Capital claims entered
2026-04-01	Hearing on equipment-deficiency claim objections held
2026-04-28	First-quarter 2026 disbursement report filed
2026-04-29	Dundon Advisers final fee application filed
2026-06-03	Debtor objected to Dundon Advisers fee application

Frequently Asked Questions

What is the current status of The Little Mint's chapter 11 case?

The court confirmed the amended plan on November 6, 2025, and the plan's effective date is December 1, 2025. As of June 2026 the case remains open in post-confirmation administration, with the reorganized debtor working through a wave of equipment-lessor and vendor claim objections and a contested financial-advisor fee application before it can seek a final decree.

Who owns the reorganized company?

The confirmed plan left Kenneth K. Moore's equity unimpaired and allowed him to retain his 100% ownership interest in The Little Mint. Moore founded the Hwy 55 business in 1991 and remained the sole owner through the merger that formed the current debtor entity.

What did general unsecured creditors receive under the plan?

Non-insider general unsecured creditors received a $500,000 base payment over five years, annual sharing of a portion of post-tax cash flow for 2026 through 2030, recoveries from estate causes of action, and 25% of net proceeds from a qualifying liquidity event through December 31, 2030.

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