Mostly Cloudy69° FULL FORECASTMostly Cloudy69° FULL FORECAST
Make us your home page
Instagram

Waffle House franchisee files for bankruptcy

TAMPA — The franchisee that owns all 90 Waffle House restaurants in Central Florida has filed Chapter 11 bankruptcy largely to stop the parent company from kicking it out of the 1,600-store system.

Brandon-based Northlake Foods Inc., which is controlled by W.B. Johnson, an Atlanta entrepreneur who once owned five Tampa Bay-area Holiday Inns and the Ritz Carlton Hotel chain, filed for the bankruptcy court protection in September.

By then Johnson, who once lived in Clearwater Beach, and his partners within the franchisee group had been fighting with each other in court for more than a year. Some of them stripped the company of enough assets that Northlake became technically insolvent, some creditors claim.

Since the filing, the franchisees have been closing stores. So far the 146 they owned in Florida, Georgia and Virginia have dwindled to 125.

Waffle House Inc., the Norcross, Ga., parent company that owns the chain and the rest of the Florida Waffle Houses from Tallahassee across the Panhandle, argues that Northlake's franchised stores, which generate about $80-million in annual revenue, would be profitable had it not been for the way Johnson and his partners split up their personal ownership of assets to settle their own differences from Northlake.

So far, much of the case revolved around ensuring the court gets a firm handle on what essentially has been run as a cash business. Founded in 1955 in Avondale Estates, Ga., the original Toddle House changed its name to the Waffle House in 1961. The chain did not accept credit cards until 2006.

Judge Carlyn Delano last week took the unusual step of appointing an outside examiner to investigate the 2007 split­up of Johnson and some of his partners.

Mark Albright can be reached at albright@sptimes.com or (727) 893-8252.

Waffle House franchisee files for bankruptcy 11/25/08 [Last modified: Tuesday, November 25, 2008 10:48pm]
Photo reprints | Article reprints

© 2014 Tampa Bay Times

    

Join the discussion: Click to view comments, add yours

Loading...