California Pizza Kitchen Files for Bankruptcy amid Coronavirus Pandemic
California Pizza Kitchen has felt the impact of the ongoing coronavirus pandemic.
The causal dining restaurant chain announced on Thursday that it has filed for voluntary Chapter 11 protection in the U.S. Bankruptcy Court for the Southern District of Texas, saying in a press release that the move will allow it "the ability to close unprofitable locations, reduce its long-term debt load, and quickly emerge from bankruptcy as a much stronger company."
Jim Hyatt, CEO of CPK, said in a separate message on the company website that the chain had already shuttered some of its locations prior to the filing, citing "the impact of the COVID-19 pandemic and lease related challenges with our landlords" as reasons for closure.
"We do not have plans to close any additional restaurants at this time," he added.
According to the company, remaining CPK restaurants will continue to operate throughout the restructuring process. Gift card and reward points will still be valid and retain their value.
"Today’s announcement is a step towards a stronger future for California Pizza Kitchen," Hyatt said in a statement.
“The unprecedented impact of COVID-19 on our operations certainly created additional challenges, but this agreement from our lenders demonstrates their commitment to CPK’s viability as an ongoing business," he continued. "Throughout this process we will continue to deliver the same innovative, California-inspired cuisine that we have been serving for over 35 years."
There are currently over 200 CPK locations in eight countries and U.S. territories, according to the company.
CPK joins many other food chains in filing for bankruptcy amid the coronavirus crisis, including Chuck E. Cheese’s parent company CEC Entertainment and fast-casual bakery chain Le Pain Quotidien.
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CEC Entertainment voluntarily filed for Chapter 11 bankruptcy in late June, with CEO David McKillips saying in a release that the process will allow the brand “to strengthen our financial structure as we recover from what has undoubtedly been the most challenging event in our Company's history."
Le Pain Quotidien announced it would close all 98 of its U.S. locations after filing for Chapter 11 bankruptcy protection in May, though at least 35 stores will potentially be reopened at a future date thanks to a partial buyout by Aurify Brands.
Large franchisees such as CFRA Holdings, which operates 49 IHOP locations, and NPC International, a company that oversees more than 1,200 Pizza Huts and nearly 400 Wendy’s restaurants, have also filed for Chapter 11 protection in the wake of the pandemic.
However, some restaurant chains have shuttered permanently due to the COVID-19 crisis. Popular West Coast eatery Souplantation — also known as Sweet Tomatoes outside of Southern California — announced in May that it will not be reopening its doors after all of its locations were temporarily shut down at the start of the coronavirus outbreak.
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