Meritage Hospitality Group files for Chapter 11 bankruptcy

Meritage Hospitality Group, a major U.S. franchisee of Wendy’s, has filed for Chapter 11 bankruptcy in the U.S. Bankruptcy Court for the Western District of Michigan. The Grand Rapids-based company operates approximately 314 Wendy’s restaurants across 15 states and employs roughly 9,000 people.

The filing follows a notice from Wendy’s franchising division seeking to terminate Meritage’s franchise rights and lease agreements. Wendy’s stated that Meritage owes approximately $27.4 million in royalties and other fees, alongside $119.5 million in continuing operations fees. The company noted it had worked with the franchisee and lenders for over a year to find a solution before deciding on termination.

Meritage cited several financial pressures, including rising beef prices, declining customer traffic, and increased competition from discounting strategies. The company reported a $31.5 million net loss in 2025, a significant shift from an $8 million profit the previous year. The Chapter 11 process is intended to allow the company to reorganize and potentially continue operating its restaurants subject to court approval.