Meritage Hospitality Group files for Chapter 11 bankruptcy

Meritage Hospitality Group, a major Wendy’s franchisee operating 314 restaurants across 15 U.S. states, has filed for Chapter 11 bankruptcy protection. The Michigan-based company is undergoing restructuring to manage over $135 million in debt.

As part of a plan to protect creditors and secure authorization to use cash collateral for daily operations, Meritage intends to close approximately 30 unprofitable locations. These closures, representing nearly 10% of its fleet, are scheduled to occur in stages through mid-October, with initial locations identified in Virginia, Florida, Texas, and Oklahoma.

The bankruptcy follows a notification from Wendy’s regarding the termination of its franchise agreement, with the chain claiming approximately $27.4 million in unpaid royalties and $119.5 million in ongoing operation charges. Despite the restructuring and planned closures, Meritage has stated its intention to continue operations and maintain salary and benefit payments for its approximately 9,000 employees.