Orange County Choppers. Lawsuits Settled. Headquarters In Foreclosure.

You ask me all the time what’s going on regarding the lawsuit and counter-lawsuit between OCC/Paul Teutul Sr and PJD/Paul Teutul Jr. and the status of the Orange County Choppers headquarters’ building.

First, all lawsuits between the parties have been settled. The settlement being confidential with no parties able to disclose the terms, you will never get any details regarding its content. It seems that the famous Black Widow bike was part of the negotiated package and went from OCC to Paul Jr.

Observers tell me that both parties feel great about putting behind them all financial disagreements, that relations between father and son are less tense but of course that things will never be the same again in the family.

OCC building foreclosure process is in process after all discussions to renegotiate the terms of the loan failed between Paul Sr. and the bank holding the mortgage. The OCC business is not at risk to be foreclosed. The bank will foreclose on the building – the only collateral – not on the business. Because Paul Senior owns all the property around the current headquarters, he is going to build a new property to house OCC at the top of a hill close by the current headquarters. Work should be completed at the end of the year.


55 Responses to “Orange County Choppers. Lawsuits Settled. Headquarters In Foreclosure.”

  1. 1 Mark Sep 13th, 2011 at 12:26 am

    Bye bye Sr, build a new building so you can default on that one when your busness goes down the tubes and we tax payers can pay that one to, what a piece a trash.

  2. 2 jd Sep 13th, 2011 at 7:52 am

    Another classic example of a good business model down the drain along with the economy – we can all thank obama for that one. Bigger is not always better, we have all seen that a hundred times and it looks like Jr will be the victor if he keeps to the basics. And funny enough, the Teutels could all walk away from bikes today and still retire comfortably off of the money they made off of the network.

  3. 3 DSR Sep 16th, 2011 at 11:55 am

    JD says: ” … Another classic example of a good business model down the drain along with the economy – we can all thank obama for that one.”

    Hey genius, you want to blame the economy on politicians instead of the American People who shopped for Chinese crap for decades at WalMart and bought houses with loans they had no ability to pay back then fine, but point the finger at conservative politicians starting with Reagan and hammering us down in the Bush years.

  4. 4 shovelhead Sep 18th, 2011 at 10:29 pm

    Face it Gentlemen
    the custom bike era as we have seen it in the last 9/10 years is over .It will never come back with the build offs and gathering and such as seen all across the US. Just like the property that got over inflated so did the Custom Motocycle bussiness. Who’s left ??? Indian,Titan,Bourget,Ironhorse, Bigdog,just to mention let along the smaller independent shops, that we use to view
    and custom vendors are gone. Daytonas Bike week has dried up these days with custom and such.Being from Fla in 06 there was just under 400 bike shops,dealers,builder ,etc now its under 200.
    Losing the building may not be what Sr. wants and I,m sure it effects him,and being oldschool
    im sure it is hard to accept.However for survival in the bussiness world rite now and exspecally the Bike building bussiness it may be a inpairative move that needs to be done and i say this from esperience as a Bike shop owner.3/4 of the vendors we use to use for custom parts and such are no longer around.
    time will tell gentlemen

  5. 5 Justatool Sep 19th, 2011 at 10:51 am

    Just my 2 cents,

    There is nothing ethically wrong about Paul Sr. walking away from a bad investment. His ethical obligation is to protect his shareholders just like that of every company including the bank. It falls to the bank to establish an rate that protects it’s shareholders. I am sure that someone is about to come up with the “I am what is wrong with America” comment, but, in fact, this is simply free markets working as intended.

    When a bank issues a loan they “should” look at factors including the risk of default and the likely coverage in the case of default. Then they establish a rate that mitigates those risks. In other words a non-recourse loan has a higher interest rate than a fully collateralized loan because there will be a larger gap in loan coverage in the event of default. So if the bank operates correctly, the additional revenue generated from the higher interest rates on all non-recourse loans covers the gap on the few that default. These two factors plus the expense of servicing the loan are the only reason that banks issue loans above the risk free rate.

    Banks can make profit on these loans in one of two ways; (1) really digging into the particulars of the business and picking those that are likely to avoid default (2) Volume – just grab an actuarial table and find the rate and issue as many as you can above that rate.

    If the bank does the above correctly then it is properly protected even in the event of default. So it is possible that both parties even on a bad business deal can act in the best interest of their shareholders. Having said that if the bank didn’t do the above then as a shareholder maybe you should move your investment to another business similar to OCC that is properly protecting its shareholders.

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