Punch Bowl Social, once one of the hottest concepts in the restaurant business with its combination of higher-end food and games like shuffleboard, only to see that business vanish when the pandemic hit, declared bankruptcy this week.
The Denver-based chain said two of its locations remain open, in Austin and Atlanta, though its remaining locations have been closed.
The company said in a filing that it determined that it needed to close its stores immediately “in light of the need to preserve cash.”
“In a now too-familiar tale, the debtors’ businesses were immediately and significantly adversely affected by COVID-19,” Punch Bowl said in a bankruptcy court filing.
Punch Bowl filed for bankruptcy with 13 separate entities, 11 of which operate a single location apiece.
In a statement, however, Punch Bowl Social said it had “no knowledge” of the filing, blaming it on a pair of former executives, or whether it was even legal. A hearing is set for Wednesday on the bankruptcy.
“The company had no advance knowledge in regards to this filing by two former executives,” Punch Bowl said in a statement. “We are unsure at this time if the filing is even legal, and our secured lender, CrowdOut, and legal counsel are currently working to resolve this issue. In the meantime we remain open to serve our guests in Atlanta or Austin.”
Punch Bowl owes $20 million to CrowdOut, which foreclosed on the company in August.
In 2019, Punch Bowl received an investment of up to $140 million from Cracker Barrel. In March, just 10 days after states began closing dining rooms to stop the spread of COVID-19, the family dining chain opted not to rescue its holding in a bid to preserve its own cash. The decision marked one of the first big signs that the coronavirus would wreak havoc on just about any concept that depended on people eating indoors.
The decision ultimately led to the departure of Robert Thompson from the chain he founded. He was replaced by John Haywood, who had previously been CEO of Souplantation and Sweet Tomatoes as that company, also hit hard by the pandemic, opted to shut its doors completely and file for Chapter 7 bankruptcy liquidation.
Punch Bowl Social claimed between $10 million and $50 million in assets and the same amount in liabilities, according to court documents.
Punch Bowl operated locations as big as 30,000 square feet that catered to younger consumers featuring games like ping pong and shuffleboard.