Citing the "unprecedented impact" of COVID-19, California Pizza Kitchen has voluntarily filed Chapter 11 restructuring in the U.S. Bankruptcy Court for the Southern District of Texas.
The company entered into a restructuring support agreement with its first lien lenders that will equitize the vast majority of CPK’s long-term debt.
This pre- negotiated filing represents a deal with CPK’s lenders and will allow the California-based restaurant the ability to close unprofitable locations, reduce its long-term debt load, and quickly emerge from bankruptcy as a much stronger company.
Additionally, this agreement contemplates approximately $46.8 million in new money debtor-in- possession financing, which will enable ongoing operation of CPK restaurants, continued payments to CPK’s vendors and employees, and provide for ongoing commitments to stakeholders while in Chapter 11. In addition, the Agreement provides financial commitments to allow CPK to quickly exit Chapter 11. CPK aims to complete the Chapter 11 process in under three months.
“Today’s announcement is a step towards a stronger future for California Pizza Kitchen,” said Jim Hyatt, CEO of CPK. “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. Throughout this process we will continue to deliver the same innovative, California-inspired cuisine that we have been serving for over 35 years.”
Additional information about the Chapter 11 case can be found at https://cases.primeclerk.com/CPK.