Friendly's Files Bankruptcy & Closes 63 Stores

Friendly's Restaurant, a 400+ restaurant chain filed for Chapter 11 bankruptcy protection on Wednesday at The United States Bankruptcy Court for the District of Delaware.

As a result of the restaurant bankruptcy filing - Friendly's closed 63 stores, each of which employed about 20 people, so about 1,260 jobs were lost.

 

The 76-year-old company known for its ice cream and hamburgers is the latest restaurant chain to file forbankruptcy, as consumers continue to eat out less, a habit they picked up during the recession, and food costs remain high.

"The strategic decision to pursue a financial restructuring will allow us to proactively and quickly improve our financial position," said CEO Harsha V. Agadi.

Friendly Ice Cream Corp., based in Wilbraham, Mass., says it has secured $70 million in financing and that its 424 remaining restaurants will stay open and pay employee salaries and benefits as it reorganizes underbankruptcy protection. Gift cards will continue to be honored. Friendly's now employs about 9,000 workers.

Read the rest of this entry »

Posted in Chapter 11 Bankruptcy , Friendly's Bankruptcy , Restaurant Bankruptcy , United States Bankruptcy Courts

Perkins Files Chapter 11 Bankruptcy

Perkins & Marie Callender's Inc. this week filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code. The Memphis-based operator of family- and casual-dining restaurants operates primarily in the Midwest, Florida and Pennsylvania under the name Perkins Restaurant and Bakery and in the Western U.S. under the name Marie Callender's Restaurant and Bakery.

As of April 17, the company owned and operated 160 Perkins restaurants and 85 Marie Callender's restaurants

The company posted revenues of $507 million in 2010.

In the weeks preceding the bankruptcy filing, the company entered into a restructuring support agreement with private investment funds managed by Wayzata Investment Partners LLC, a Minnesota-based private equity firm. Wayzata controls about $293 million of Perkins outstanding debt.

In connection with the restructuring agreement, the company and Wayzata negotiated the principal terms of Perkins' plan of reorganization and debt maturity extensions. The company also entered into an agreement with Wells Fargo Capital Finance to provide it with a $21 million debtor-in possession financing facility.

As part of its restructuring plan, the company closed 58 restaurants across the country and is looking to cancel leases on those eateries as well as seven other previously closed restaurants.

Read Original Article Here.

Read the rest of this entry »

Posted in Chapter 11 Bankruptcy , Perkins , Perkins Bankruptcy , Restaurant Bankruptcy