Georgia is in danger of losing more than 15% of its Wendy's locations following the bankruptcy filing of Meritage Hospitality Group. Here's what we know:
Wendy's terminates franchise agreement
The Wendy's company, under the LLC Quality Is Our Recipe, said in a Sept. 21 court filing that Meritage owes the company $27.4 million in royalties, advertising and past due fees dating to 2025 and that it had terminated its franchise agreement on Sept. 16, prior to the bankruptcy filing.
The termination, the company said, would prevent Meritage from operating its restaurants as Wendy's locations. It's unclear what effect the termination will have on the restaurants' continued operation or the bankruptcy case.
"Our focus remains on serving our customers, supporting our franchise system, and strengthening
the long-term health of the brand," said Wendy's VP of communications Heidi Schauer. "We partner closely with franchisees that are experiencing challenges to support them and evaluate each situation on a case-by-case basis to identify the best and most sustainable path forward. We worked with this franchise organization and its lenders for more than a year to find a sustainable path forward. Ultimately, based on these circumstances, we determined that termination was the appropriate course of action."
List of Meritage Hospitality Wendy's locations in Georgia
A map on Meritage's website says it has 48 Wendy's locations in Georgia. But, court documents report 44 open locations impacted plus a small handful that are already closed. We put together a list of those open Wendy's mentioned:
Is Wendy's closing?
It's unclear when or if these locations will close. Schauer said she doesn't anticipate a disruption to restaurant operations at this time. Meritage said in court documents that it plans to weigh its options and restructure (which could mean closing or selling underperforming locations) while also noting that it's working on "preserving jobs and restaurant operations across the 15-state footprint."
The filing says Meritage should not be authorized to "conduct any business activity pursuant to the terminated franchise agreements. Permitting Debtors to continue to operate the restaurants would be a violation of state and federal law…"
Where does Meritage Hospitality have Wendy's restaurants?
The company operates 314 Wendy's locations across Indiana, Ohio, Tennessee, Massachusetts, Connecticut, Missouri, Arkansas, Virginia, North Carolina, Georgia, Florida, Mississippi, Oklahoma and Texas.
Is Wendy's going out of business?
While there are no reports about Wendy's as a whole going out of business, Yahoo Finance detailed how the chain is facing difficulties with 289 locations closed across the US during the first half of the year.
"Understand that the health of franchisees certainly is pressured right now because of the sales declines that we have had," Wendy's CEO Bob Wright told analysts, as reported by Yahoo. "You guys know this business. When you see some of the sales declines, it is going to show up in restaurant profitability. It is going to pressure the franchisees and create a little bit of fragility there. When it came to closures, I think what you heard in some previous quarters was closures addressed more as a program for the system. You will see us take a much more targeted approach. We are going to come alongside our franchisees if they need our help."
USA Today Co. reporters Chad Murphy and Dan Basso contributed to this article.
Miguel Legoas is a Deep South Connect Team Reporter for USA Today. Find him on Instagram @miguelegoas and email at mlegoas@gannett.com.
This article originally appeared on Savannah Morning News: Wendy's franchisee declares bankruptcy. These GA restaurants impacted
