Another major restaurant operator has filed for Chapter 11 bankruptcy. This time it’s Summit Restaurant Holdings, a 145-unit Hardee’s franchisee based in Boulder, Colorado.
Summit filed for bankruptcy May 4.
The group is part of a larger company, Capstone Restaurant Group, which operates more than 220 Hardee’s and Carl’s Jr. locations in 16 states, mostly in the Midwest and southern United States. Capstone was founded in 2010 and is based in Boulder as well. Capstone is the second largest franchisee in the CKE Restaurants sytem, according to Capstone’s website. CKE Restaurants is the holding company of Hardee’s and Carl’s Jr.
A CKE spokesperson issued a statement to Franchise Times, which in part said, “Summit expects to enter into an asset purchase agreement with a qualified and well-capitalized buyer, with a record of success across the restaurant, entertainment, food, beverage and retail markets. The buyer would acquire a majority of Summit’s remaining open and operating restaurants.”
Local reports show a handful of these locations have closed recently, including all three of the Hardee’s stores in Wichita, Kansas, according to The Wichita Eagle. The employees weren’t given an explanation at the time, The Eagle reported.
A Hardee’s in Columbia, Missouri, also closed in April, which The Columbian Missourian said was owned by Summit. The remaining area locations, also Summit-owned, remain open, according to The Columbian.
At least 14 Atlanta-area Hardee’s restaurants, owned by Capstone and Summit, have closed, according to an Atlanta blogger.
The remaining Summit Hardee’s locations open “are expected to conduct business as usual – including continuing to pay wages and provide benefits to employees, as well as doing business with customers and vendors in a routine manner while working to complete the sale,” according to a CKE spokesperson.
The statement continues, “CKE’s goal is to maintain the maximum number of stores continuing to operate, backed by a capital structure that is sustainable and poised for long-term growth and success, and we are working with all parties to achieve that goal.”
The spokesperson said Hardee’s fiscal year 2024 “remains on track with an exciting opportunity for growth.”
Summit listed its estimated assets between $1-10 million, and its estimated liabilities range from $10-50 million, according to the filing.
Summit’s attorney is James T. Markus, of Markus, Williams, Young & Hunsicker law firm. Markus did not immediately respond to Franchise Times’ request for comment.
Several other major U.S. restaurant operators have filed for bankruptcy lately, including Meridian Restaurants Unlimited, a 118-unit Burger King franchisee. Another Burger King franchisee, TOMS King, filed for Chapter 11 bankruptcy at the start of this year. TOMS is a 90-unit operator based in Palatine, Illinois.