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Largest fast food franchisee in U.S., 1,600 Pizza Hut and Wendy's places, files for bankruptcy

Christian Fernsby ▼ | July 3, 2020
NPC International, the largest fast food franchisee in America, which owns 1,600 Pizza Hut and Wendy's locations, files for bankruptcy.
Pizza Hut
NPC International   Pizza Hut
NPC International announced that it has entered into a restructuring support agreement (RSA) with lenders holding approximately 100% of the company’s first lien priority debt and 70% of its first lien debt (collectively, the Senior Secured Lender Group) to substantially reduce NPC’s long-term debt and strengthen the company’s capital structure.

Topics: U.S. Pizza Hut Wendy

NPC and the Senior Secured Lender Group contemplate that the terms of the RSA would become part of a comprehensive Chapter 11 plan to restructure the company’s balance sheet and optimize its portfolio of restaurants throughout the country.

Accordingly, NPC and certain of its affiliates and subsidiaries filed voluntary petitions to restructure under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of Texas.

NPC intends to use the Chapter 11 process to engage in further discussions with its brand partners, landlords and other creditors to achieve a consensual Chapter 11 plan of reorganization that will best position the company for long term success in the current restaurant industry environment.

NPC has filed several customary "First Day" motions with the Court, which are intended to ensure that the Company is able to maintain operations in the ordinary course and facilitate a smooth transition into Chapter 11.

Among these is a motion to continue providing wages, salaries and benefits to all NPC employees without change or interruption, and NPC does not expect there to be any changes to employees’ day to day job responsibilities or work schedules.

Similarly, NPC intends to pay vendors under customary terms for goods and services provided on or after the Chapter 11 filing date.

The Company has sought and expects to receive Court authorization to continue to use its available cash, which it believes will provide sufficient liquidity to meet its ongoing obligations throughout the Chapter 11 process.

NPC’s Pizza Hut and Wendy’s restaurants throughout the country remain open for business on regular schedules. NPC is continuing to closely follow the guidance and recommendations from the Centers for Disease Control and Prevention (CDC), as well as from local and federal governments and public agencies, regarding any service restrictions. The Company remains focused on protecting the safety of its team members and guests, while serving and supporting its local communities.


 

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