BarFly Ventures files for bankruptcy; announces plans to reopen restaurants
The parent company of HopCat and other local restaurants filed for Chapter 11 bankruptcy relief while simultaneously announcing its plan for reopening its restaurant locations.
Grand Rapids-based BarFly Ventures — the parent of HopCat, Stella’s Lounge and Grand Rapids Brewing Co. — said Wednesday that it filed petitions for relief under Chapter 11 of the U.S. Bankruptcy Code in the U.S. District Court for the Western District of Michigan.
“This action should have little to no impact on our day-to-day business operations but will allow us to emerge as a financially stronger company and enable us to continue serving our guests, team members and other business partners for many years to come,” said Mark Sellers, founder of BarFly Ventures.
The company said it will:
- Honor customer programs such as gift cards and HopCat loyalty rewards
- Pay employee wages and benefits in the ordinary course of business
- Pay vendors and suppliers in a timely fashion going forward
“As is the case with most restaurants, BarFly has faced a number of challenges in recent years, including increased industry competition and craft beer saturation,” Sellers said. “However, we were meeting these challenges, and operationally, the business was sound, until the recent global pandemic pushed us into an unforeseen economic crisis and a 100% drop in revenue for almost three months.
“After an exhaustive examination of all options, we’ve determined the Chapter 11 process is the best path forward to enable BarFly to focus on continued growth and transformation for the future.”
Los Angeles-based Pachulski Stang, Ziehl & Jones LLP and Grand Rapids-based Warner, Norcross + Judd are serving as legal advisers to BarFly.
New York-based Rock Creek Advisors is serving as financial adviser, and Austin, Texas-based Mastodon Ventures Inc. is serving as investment banker.
BarFly also said Wednesday that it will reopen its Michigan dining locations effective June 13.
Its venues in Lincoln, Nebraska, and Indianapolis will reopen June 22 in accordance with those states’ guidelines, BarFly said.
The move to reopen the Michigan restaurants comes following Gov. Gretchen Whitmer’s Executive Order 2020-110, which allows restaurants in the state to reopen Monday with capacity limitations and other restrictions.
BarFly said it is taking “extraordinary precautions” to protect employees and guests with increased cleaning, sterilization and social distancing procedures, among other elements.
“It’s been a rough few months, but we’re excited to welcome our team and local community members back into our restaurants,” Sellers said. “We’re following all CDC guidelines and taking extra precautions to ensure the health and safety of our staff and guests.”
In mid-March, Barfly temporarily closed all locations under federal and local government mandates in various states.
Barfly’s other restaurants will be opening in phases with dates to be announced soon.
Posted By: Grand Rapids Business Journal on June 4, 2020. For more information, please click here to read the source article.
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