The parent company of Hwy 55 Burger Shakes & Fries has sought Chapter 11 bankruptcy protection, joining several other restaurant chains affected by pandemic-related challenges. The Little Mint Inc., which operates 22 corporate locations and oversees 71 franchised restaurants across the Southeast, filed its petition on December 31 in the Eastern District of North Carolina’s U.S. Bankruptcy Court.
Prior to the filing, the company closed 13 corporate-owned
establishments as it faced mounting financial pressures. Court documents reveal the company’s assets range between $1 million and $10 million, while liabilities fall between $10 million and $50 million. Specifically, the company carries approximately $11 million in secured debt and $5.8 million in unsecured obligations.
Among the largest unsecured creditors, Sysco Food is owed more than $782,000, while the North Carolina Department of Revenue claims $600,000 in unpaid sales tax. Retail Data Systems has outstanding claims exceeding $594,000. Financial records indicate the chain operated at a loss in both 2022 and 2023, with annual revenue reaching $24.4 million in 2023.
The chain’s difficulties began during an ill-timed expansion effort in 2018, when it planned to transition from strip mall locations to standalone buildings with drive-through windows. This strategy aimed to modernize operations and maintain competitiveness. However, attempts to secure financing in 2019 proved unsuccessful, and the subsequent pandemic in 2020 created additional obstacles to opening new locations.
Between 2021 and 2024, Hwy 55 opened 30 new locations to fulfill contractual obligations, but relied on costly alternative financing arrangements. The company struggled with staffing challenges exacerbated by government relief programs and rising wages. Unable to increase menu prices due to its fixed-income customer base, the chain simultaneously faced escalating costs for equipment and supplies amid inflation and supply chain disruptions.
The company’s troubles were compounded by internal issues.
Approximately one year before filing for bankruptcy, Hwy 55 discovered its in-house accounting department had failed to maintain regular payments to utilities, tax authorities, and other routine obligations, necessitating a complete departmental overhaul.
Founded in 1991 as Andy’s Cheesesteaks & Cheeseburgers, the chain rebranded to Hwy 55 Burgers Shakes and Fries in 2012 when it began franchising operations. The restaurant currently maintains a presence across North Carolina, South Carolina, Georgia, Florida, Tennessee, and Texas.
This filing follows a pattern of financial distress in the fast-food industry, with several chains seeking bankruptcy protection in recent years. Notable examples include BurgerFi, which filed for Chapter 11 in September 2024 after closing 19 underperforming locations. The chain was subsequently purchased by TREW Capital Management for $10 million and later sold to Savvy Sliders.
Other recent bankruptcy filings in the industry include Pizza Hut franchisee EYM with 140 locations in July 2024, Arby’s franchisee Miracle Restaurant Group operating 25 establishments in June 2024, and Popeyes franchisee RRG Inc. with 17 locations in February 2024.
As of January 6, The Little Mint Inc. had not filed a motion for debtor-in-possession financing. The bankruptcy filing came after demands from creditors, collection efforts by the North Carolina Department of Revenue, and the expiration of a forbearance agreement with a food distributor.