UFood Restaurant Group and its wholly owned subsidiaries filed a voluntary petition under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the District of Massachusetts in order to preserve its operations and to resolve its liquidity issues in the face of the slow recovery from the current economic downturn.
Other members of the UFood Group (including its affiliates and franchised stores in Massachusetts, Ohio, Texas, Utah, and Maryland) have not filed for protection.
The company's financial troubles stem from a number of factors that prevented the anticipated growth and caused some of the company's stores to be unprofitable for a significant period of time, resulting in the company's current liquidity problems.
The company has obtained a financing facility that is likely to be sufficient to support it during the Chapter 11 process, and the company's restructuring plan has the support of its lenders.
Day-to-day operations and business will continue throughout the country as the company continues to provide its customers with the highest quality and healthiest food at the most reasonable price.
The Chapter 11 process will provide the company with the opportunity to restructure its finances and execute on its business model to provide sustainable profits and long-term growth.
The company looks forward to continuing its relationships with its customers, vendors, and franchisees in the process of shaping the long-term success of the UFood brand.