Wendy’s Operator Files for Bankruptcy After Running 314 Locations Across the U.S.
Meritage Hospitality Group, one of the largest Wendy’s franchise operators in the United States, has filed for Chapter 11 bankruptcy protection after operating hundreds of Wendy’s restaurants across the country. The Grand Rapids, Michigan-based company operates 314 Wendy’s locations in 15 states and employs approximately 9,000 people, making the restructuring significant for both the company’s workers and the fast-food chain’s franchise system.
Meritage filed its voluntary Chapter 11 petition in federal court in western Michigan on September 17, 2026, one day after Wendy’s issued a notice seeking to terminate the company’s franchise agreement effective immediately. Wendy’s says Meritage owes $27.4 million in royalties and fees, as well as $119.5 million in continuous operations fees connected to restaurants that were closed during the franchisee’s restructuring efforts.
For customers, the immediate situation is different from a typical restaurant closure. Meritage says it intends to keep its Wendy’s restaurants operating during the bankruptcy process, continue paying its approximately 9,000 employees and maintain payments to suppliers and vendors, subject to court approval of its requests. The company has also sought to continue employee benefits and honor Wendy’s gift cards and loyalty programs during the restructuring.
Why Meritage Is Facing Financial Trouble
The bankruptcy follows a difficult period for Meritage and Wendy’s. Meritage closed about 60 underperforming Wendy’s restaurants late in 2025 as part of a restructuring effort, but the closures also created additional financial obligations under Wendy’s franchise agreements. Court filings show that Wendy’s is asserting claims totaling roughly $146.9 million, including the $27.4 million in royalties and fees and $119.5 million in continuous operations fees.
Meritage has said broader challenges affecting the Wendy’s system have put significant pressure on its financial position because most of its restaurant portfolio operates under the Wendy’s brand. Those challenges include weaker customer traffic, elevated costs and intense competition in the fast-food market. Fox Business reported that Meritage’s store-level earnings declined 48% in 2025, while court records show the company reported a $31.5 million net loss that year compared with $8 million in net income in 2024.
Wendy’s has been dealing with its own sales and operational problems. The chain closed 240 restaurants in 2024 and said earlier in 2026 that it planned to close as many as 358 locations during the year. U.S. same-store sales fell 7% in Wendy’s most recent quarter, according to the Associated Press, adding to the pressure facing franchisees that depend heavily on the brand.
Where Meritage Operates Its Wendy’s Restaurants
Michigan is Meritage’s largest Wendy’s market, with 54 restaurants. The company also operates 44 Wendy’s locations in Georgia and 44 in Florida, along with 29 in Connecticut, 24 in Tennessee and 23 in Oklahoma. Its remaining restaurants are spread across Arkansas, Indiana, Massachusetts, Mississippi, Missouri, North Carolina, Ohio, Texas and Virginia.
Meritage’s relationship with Wendy’s stretches back more than two decades. The company began operating Wendy’s restaurants in Michigan in 1998 after purchasing 28 locations, and it later expanded substantially through additional acquisitions. During a seven-year period beginning in 2011, Meritage purchased another 234 Wendy’s restaurants, eventually becoming one of the largest franchise operators in the system.
The company has also pursued business outside Wendy’s. Meritage operates one Bojangles restaurant and five other restaurant concepts, and it agreed in 2025 to build 15 new Bojangles restaurants by April 2031. Its first Michigan Bojangles opened in February 2026, but Wendy’s restaurants still make up the overwhelming majority of Meritage’s restaurant portfolio.
What Happens to the 314 Wendy’s Locations Now
Chapter 11 does not automatically mean that Meritage’s Wendy’s restaurants will close. The company entered bankruptcy with a plan to continue operating its restaurants while it restructures its finances, and it has said that employees should continue receiving wages and benefits while the case proceeds, subject to court approval. Meritage also expects restaurant operations and debtor-in-possession financing to provide liquidity during the restructuring.
The more complicated issue is Meritage’s relationship with Wendy’s. Wendy’s issued a notice terminating the franchise agreement on September 16, while Meritage’s bankruptcy filing came the following day. Wendy’s says it spent more than a year working with Meritage and its lenders to find a sustainable solution before deciding that termination was appropriate. The bankruptcy case will now determine how the company’s financial obligations and franchise relationships are handled.
For now, the filing does not mean all 314 restaurants are disappearing from local communities. Meritage says it intends to keep serving customers while the court-supervised restructuring moves forward, but the longer-term future of the restaurants will depend on the bankruptcy proceedings, negotiations with Wendy’s and other creditors, and the company’s ability to stabilize its finances.
