News

Round Table Pizza files for Chapter 11

February 9, 2011

Concord, Calif.-based Round Table Pizza, which includes 470 franchise- and company-owned stores, has filed a petition for protection under Chapter 11 with the U.S. Bankruptcy Court in Oakland, Calif.

The move is anticipated to improve the company's cash flow and stabilize its business through recapitalization of debt and renegotiation of above-market leases. Despite improving business performance and expense reductions, the company said the filing was necessary to improve the company's competitiveness as the economy recovers.

"Our company has experienced consistent growth and management has been responsive to the difficult economic environment," said Rob McCourt, president and CEO. "Unfortunately, we are compelled to take further steps, including this reorganization plan, to meaningfully address the high cost of our capital and above-market leases."

The action will not impact Round Table's 148 franchisees that operate 355 independently owned units on the West Coast.

Round Table Pizza Inc. will close some unprofitable, company-owned restaurants but stressed that most of its company-owned locations and all of its franchised locations will remain open, with minimal impact on consumers.

"Round Table remains open for business and fully operational, and we will continue to serve our customers 'The Last Honest Pizza,'" said McCourt.

McCourt also said the company was placing a high priority on communication to employees, franchisees, vendors and other key audiences through the reorganization process, which is expected to take approximately 6 to 12 months.