On Friday, privately-held toasted sandwich chain parent Quiznos announced that it had voluntarily filed for Chapter 11 bankruptcy protection.
In a statement, Denver-based Quiznos said that its senior creditors had agreed to a “pre-packaged” restructuring plan. The plan will slash Quiznos’ debt by more than $400 million.
Given that its senior lenders have signed off on the restructuring plan, Quiznos says it expects to emerge from bankruptcy protection “on an accelerated basis.”
Quiznos operates almost 2,100 restaurants in the U.S. and in 30 other countries worldwide. Virtually all of those locations are franchises and will not be affected by the bankruptcy filing.
The company’s senior lenders have also provided Quiznos with $15 million in debtor-in-possession financing commitments to fund operation during the reorganization. That financing will require approval from the bankruptcy court.
Rumors that Quiznos would seek bankruptcy protection have been circulating for some weeks. The company reportedly has about $570 million in debt.