By When True Food Kitchen filed for Chapter 11 bankruptcy protection on October 4, the chain’s CEO Jeff Chandler tried to make it clear that the company planned to continue operating.
“This process is the best path forward to simplify the business and focus on what we do best: delivering craveable, health-forward food and genuine hospitality. We are confident this step will help us build a stronger True Food Kitchen for the future,” he said in a press release.
True Food Kitchen serves an upscale clientele looking for healthy food. Most of its stores are located in higher-end shopping or lifestyle plazas. That contributed to its financial problems, Chad Van Horn, founder and managing partner of Van Horn Law Group in Fort Lauderdale, Fla., shared with TheStreet.
“True Food Kitchen did not file because people stopped eating there. Sales were essentially flat, about $312 million last year against $314 million the year before, and the reported debt is around $42 million. That is a cost and footprint problem, not a demand problem,” he said.
As part of its Chapter 11 bankruptcy filing, True Food Kitchen shared that it had already closed 12 restaurants. Those locations completed their final service on Oct. 4, but the initial release did not share which locations were closing.
TheStreet compared True Food Kitchen’s current restaurant directory with an archived version of the company’s locations page to identify the 12 restaurants that closed.
Fox Business also independently reported the same 12 locations
These True Food Kitchen locations have closed
Chandler apologized for the impact the closures had on the chain’s employees:
“We know these decisions are especially hard on the team members affected, and we are deeply grateful for their contributions to True Food Kitchen and their communities. We are committed to approaching this difficult moment with care and respect, and we will share information on resources and next steps with affected team members,” he said.
The company’s remaining 34 restaurants across 14 states are open and serving guests as usual. The True Food Kitchen locations that closed are:
- Century City: Los Angeles, CA (Westfield Century City)
- El Segundo: El Segundo, CA (The Point)
- San Diego UTC: San Diego, CA (Westfield UTC)
- Miami: Miami, FL
- Chicago: Chicago, IL
- New Orleans: New Orleans, LA
- Bethesda: Bethesda, MD
- Edison: Edison, NJ
- Hackensack: Hackensack, NJ
- Garden City (Long Island): Garden City, NY
- Columbus: Columbus, OH
- Reston: Reston, VA
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A Chapter 11 filing lets you close restaurants
Van Horn thinks that closing struggling locations was a significant factor in the True Food Kitchen filing decision.
“For restaurant chains, Chapter 11 is mostly about leases. Rent is the biggest fixed cost a chain has, and it does not shrink when traffic does. In Chapter 11, a company can reject the leases on locations that lose money, and the Bankruptcy Code caps what a landlord can claim for the rest of the term, generally the greater of one year’s rent or 15% of the remaining term, up to three years,” he told TheStreet.
The shutdowns, he added, speak loudly.
“Closing 12 of 46 restaurants at the outset tells you exactly where the company thinks the losses are,” he wrote.
More Bankruptcy:
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Van Horn sees True Food Kitchen as a victim of bigger trends.
“Casual dining has been squeezed between higher labor, food, and rent costs on one side and more careful diners on the other. Several national chains have used Chapter 11 the same way over the last two years: close the losing locations, cut the debt, and either sell or come out smaller,” he added.
True Food Kitchen Chapter 11 basics
- Chapter 11 filing: True Food Kitchen and eight affiliated companies filed for Chapter 11 bankruptcy protection on Oct. 4, 2026, in the U.S. Bankruptcy Court for the Southern District of Texas. The lead case is FRC Balance LLC, case No. 26-90806.
- Debt: The company reported approximately $42.1 million in funded debt as of the bankruptcy filing. Its petition estimated both assets and liabilities at between $10 million and $50 million.
- Financing: True Food has secured a commitment for approximately $20 million in debtor-in-possession financing from HumanCo TFK IV, subject to court approval. The financing is intended to provide liquidity while the company restructures and pursues a sale.
- Sale process: The company plans to pursue a court-supervised sale and find a long-term partner or buyer.
- Closures: True Food closed 12 restaurants as part of the restructuring, leaving 34 locations operating across 14 states. The company had previously reached a peak of 46 locations.
- Major unsecured claims: The company has 16 unsecured creditors with claims exceeding $100,000, including two creditors with claims above $1 million. Shamrock Foods has a claim of approximately $1.2 million.
- Source: PacerMonitor
