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BurgerFi International, Inc. (NASDAQ:BFI, BFIIW), the parent company of the high-quality dining chain Anthony's Coal Fired Pizza & Wings and the popular fast-casual burger brand BurgerFi, recently announced a significant milestone in its Chapter 11 bankruptcy proceedings. On September 11, 2024, the company filed for bankruptcy protection in the U.S. Bankruptcy Court for the District of Delaware in Wilmington under case number 21-12017. This move aims to facilitate the company’s restructuring process and ensure the continuity of operations across its 144 locations.
The Court has granted interim approval for BurgerFi to access $3.5 million in debtor-in-possession (DIP) financing from an affiliate of TREW Capital Management. This financing is critical for maintaining daily operations and upholding the standards of both the BurgerFi and Anthony's brands. In addition to the DIP financing, the Court has approved the use of the company's existing employee benefits, cash management systems, and customer programs, which are essential for smooth operational continuity.
Carl Bachmann, CEO of BurgerFi International, expressed satisfaction with the Court's decision, emphasizing the company's commitment to its employees, customers, and franchise partners. "The Company has worked very hard to ensure that the transition into Chapter 11 would have no impact on our valued employees, customers, and franchise partners," Bachmann said. He highlighted the approval of key motions related to employee wages, benefits, and customer programs as a crucial step in supporting ongoing operations.
As part of the restructuring plan, BurgerFi intends to propose a sale process and establish bidding procedures, with support from its lenders. This plan is expected to provide the necessary liquidity to fund operating expenses and meet obligations during the restructuring period. The "second day" hearing for final approval of these requests is scheduled for October 7, 2024.
Jeremy Rosenthal, Chief Restructuring Officer, underscored the importance of the interim approval, stating, "Receipt of interim approval of our DIP financing provides the Company with liquidity to fund operating expenses and meet obligations while we restructure. We now have the liquidity for operations at BurgerFi and Anthony's to continue as usual."
In a related development, David Heidecorn has resigned from his position as an independent member and Chairman of the Board of Directors, effective immediately. This transition comes as BurgerFi navigates its restructuring efforts and plans for future stability and growth.
