The largest chunk of Jack’s Donuts debts—nearly $3.5 million—is owed to Old National Bank. It also owes more than $1.2 million to Impact Networking Indiana, a business consulting firm.
Jack’s Donuts filed for bankruptcy October 29 following legal issues and franchisee complaints. In a statement on Facebook, Jack’s Donuts said its stores will remain open as usual.
Jack’s Donuts of Indiana Commissary filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court of Southern Indiana in tandem with affiliates Marcum Industries and KCL Group. CEO Jack “Lee” Marcum leads the company.
In the court filing, Jack’s Donuts listed between 100 and 199 creditors. It reported $1.4 million in personal property assets. For liabilities, the franchisor reported $4.1 million to creditors who have secured claims and about $10.1 million to creditors with unsecured claims, for a total of just under $14.2 million.
“The Jack’s franchisor and certain related entities are the subject of the bankruptcy proceedings, and no independently owned franchisee is subject to this action,” the franchisor wrote on Facebook. “For more than 60 years, Jack’s Donuts has been about more than donuts—it’s been about people. As we move through this process, our focus is the same: to ensure that the Jack’s experience continues for generations to come.”
The brand’s website appears to be shut down, but its social media accounts remain active.
The largest chunk of Jack’s Donuts debts—nearly $3.5 million—is owed to Old National Bank. It also owes more than $1.2 million to Impact Networking Indiana, a business consulting firm.
Marcum Industries reported almost $3.9 million in liabilities and $98,471.99 in assets, most of which is from real estate it owns in New Castle, Indiana. The court filing lists up to 50 creditors.
Meanwhile, KCL Group, doing business as Jack’s Donuts, listed up to 50 creditors. Its assets total $17,057.65 and its liabilities come to $4.2 million, according to court documents.
In January, a group of Jack’s franchisees wrote a letter to Marcum, asking him to resign. The letter, obtained by Indianapolis news station WRTV, detailed operators’ struggles under his leadership.
Eight franchisees who own 18 stores claimed a noticeable decline in sales is the result of Marcum’s “misappropriation of company funds, financial mismanagement and the creation of multiple entities for personal financial gain,” according to the letter. “These actions have directly harmed the integrity of the Jack’s Donuts brand, tarnishing its reputation and eroding trust with both customers and franchisees.”
The brand opened a commissary in New Castle in October 2023 to produce and distribute donuts, rather than have franchisees continue to bake donuts in house. Franchisees told WRTV that the commissary donuts didn’t taste as good as they did before and operators were losing customers because of it.
Then, in late 2024, Jack’s apparently told some franchisees that the commissary couldn’t supply donuts to all the brand’s stores—but operators had offloaded kitchen equipment and baking staff because of the commissary. Others purchased real estate that didn’t have kitchen space, according to WRTV.
In April this year, a trucking company sued the franchisor for $769,625, which the donut chain allegedly owed Carter Logistics for delivering donuts in Indiana.
Old National Bank in February sued Jack’s Donuts, Marcum and related entities for $3.4 million for allegedly defaulting on loans, according to the suit filed in Henry County, Indiana. A circuit court judge ruled in favor of ONB on June 26.