# Meritage Files Bankruptcy for Wendy's Restaurants

> Meritage Hospitality Group files Chapter 11 bankruptcy amid Wendy's sales slump and rising costs.
- Title: Meritage Files Bankruptcy for Wendy's Restaurants · Newsweek
- Summary: Meritage Hospitality Group files Chapter 11 bankruptcy amid Wendy's sales slump and rising costs. Meritage Hospitality Group, operating 314 Wendy's…
- Keywords: meritage hospitality, wendy's, chapter 11, bankruptcy, franchisee, fast food, operating costs, sales slump, Meritage, Files, Restaurants, Newsweek
- Source: Newsweek — https://newsweek.com/wendys-meritage-hospitality-group-hamburgers-bankruptcy-chapter-11-12462161
- Read time: 1 min
- Topics: meritage hospitality, wendy's, chapter 11, bankruptcy, franchisee, fast food, operating costs, sales slump
## Meritage Files Bankruptcy
Meritage Hospitality Group, a major Wendy's franchise operator, filed for Chapter 11 bankruptcy protection in U.S. Bankruptcy Court for the Western District of Michigan.
## Financial Pressures
The filing cites declining sales, rising food and labor costs, and a 48 percent drop in store-level EBITDA for 2025.
## Wendy's Franchise Impact
Wendy's franchise business is Meritage's largest unsecured creditor with a $24.9 million claim in deferred franchise fees.
## Restaurant Operations
Meritage operates 314 Wendy's restaurants across 15 states, plus one Bojangles location and five independently branded concepts.
## Bankruptcy Process
The company expects to maintain operations during restructuring, paying wages and benefits subject to court approval.
## Industry Concerns
Financial experts note 42 percent of restaurant operators reported unprofitability in 2025 amid rising input costs and discounting.
## Franchise Economics
Royalties for franchisees are based on sales, not profit, causing margin erosion when traffic weakens and discounting increases.
## What Happens Next
Meritage may sell or shutter underperforming locations during bankruptcy but has no immediate closure plans.
## Key takeaway

Meritage Hospitality Group, operating 314 Wendy's restaurants, filed for Chapter 11 bankruptcy due to financial pressures from declining sales and higher operating costs.