http://news.yahoo.com/sale-m-h-hot-dog-chain-falls-apart-224031784.html
TOLEDO, Ohio (Reuters) - The court-supervised sale of a financially troubled Ohio hot dog restaurant chain made famous in the TV series "M*A*S*H" has collapsed after the buyer withdrew his offer, saying a bank suddenly increased the interest on a loan central to the deal.
The complication left the future of Tony Packo's restaurants unclear, though a judge said on Wednesday he was committed to finding a buyer for the five-restaurant chain and keeping it open.
Tony Packo's, in its 80th year, rose to fame in the 1970s when Toledo native Jamie Farr played a Korean War soldier who frequently talked about home and his favorite hot dog on the hit TV show.
Packo's has been under duress since August 2010, when the company's co-owner, Robin Horvath, alleged misappropriation of corporate funds in a lawsuit against his cousin, Tony Packo III, Packo's executive vice president. Packo's then defaulted on a Fifth Third Bank loan and Horvath sued to gain control of the company from co-owner Tony Packo, Jr., Tony III's father.
The case ended up in Lucas County Common Pleas Court, where Judge Gene Zmuda was charged with finding a buyer. Five entities submitted bids, including separate offers from Horvath and the two Packos and one from Bob Bennett's Ohio-based TP Foods LLC.
On December 19, Zmuda approved the sale of TP Foods for $5.5 million.
Bennett said the deal fell apart when Fifth Third Bank suddenly increased the interest rate on a $2.6 million loan made to Tony Packo's from 2.5 percent to 6 percent. Bennett had agreed to pay off the loan as part of the purchase price.
Bennett also said Fifth Third wanted to assume control of the deal and told Bennett he would have to regularly report to bank officials, terms he found unacceptable.
"In the end, the management and financial risks of going forward were too great to bear," Bennett said.
A Fifth Third spokesman declined to comment.
(Reporting by George J. Tanber; Editing by Mary Wisniewski and Daniel Trotta)
