After trying to open too many restaurants at once, Eat Here Brands found itself with mounting debt and several closed locations. However, it still had six performing locations as well as a seventh location under construction with a favorable lease in a desirable area. The Board and debt holders brought in GGG to assess the situation and determined that filing for protection under Chapter 11 of the Bankruptcy Code would be the best course of action.
GGG worked with the company and persuaded the current debt holder to provide a Debtor-in-Possession loan. GGG developed an aggressive plan and budget to sell the remaining restaurants within 13 weeks. GGG actively worked with management and vendors to keep the lights on, while also aggressively marketing the locations.
Within a few weeks, several bids were garnered. One group ended up buying five of the locations, a different entity bought the location under construction, and one location was shut down. All the DIP funding was paid back at closing. Also, the debt holder got 40% of its original money back, which was much more than anticipated.