Toasted sandwich maker Quizno’s Corp. has filed for Chapter 11 bankruptcy.
According to multiple press reports, the Denver-based company is reportedly $570 million in debt, but plans to continue operating during the bankruptcy process. However, in an effort to reduce costs, the chain plans to remove some items off its menu.
This is the second major bankruptcy filing by a large-scale food chain over the last month—as we reported last week, Sbarro’s pizza chain also filed for Chapter 11 bankruptcy.
According to NewsChannelDaily.com, Quizno’s will attempt to implement a $400 million debt-restructuring plan during the bankruptcy process. Reports indicate that a few years ago, the chain reached an out-of-court agreement with creditors that would cut its debt by more than a third.
Quizno’s has fallen behind restaurants like Subway, Panera Bread and Chipotle in the marketplace. In its bankruptcy filing, the sandwich maker said that many of its chains are located in shopping malls and office plazas in which many retailers have suffered closures, resulting in decreased businesses to the restaurants.
The filing will allow Quizno’s to pay for leases and save money for store improvements and advertising. Quizno’s biggest rival, Subway, has more than 35,000 stores. Quizno’s currently operates 2,100 locations.
Do I Need to Contact a Washington D.C. and Maryland Bankruptcy Attorney?
Chapter 11 bankruptcies allow businesses like Quizno’s and Sbarro’s to remain in control of their operations while restructuring debt. Sometimes, while the bankruptcy process is taking place, chains will look for potential buyers.
Individuals looking for debt relief have options in Chapter 13 and Chapter 7 bankruptcies. These plans can stop wage garnishments and repossessions. They can also help eliminate debt. During a Chapter 7 bankruptcy, a debtor can discharge unsecured debt, like credit card debt or medical bills.
If you are struggling to pay your bills, contact our Washington DC and Maryland bankruptcy lawyer now for a free consultation.
Law Firm of Kevin D. Judd