Neighborhood Restaurant Partners: 53-Unit Applebee's Franchisee Files Chapter 11 with Dine Brands Stalking Horse

NRPF Group Two, LLC and two affiliated Applebee's franchisee entities filed chapter 11 petitions on March 24, 2026, in the U.S. Bankruptcy Court for the Northern District of Georgia. The three jointly administered debtors -- NRPF Group Two, LLC (Case No. 26-53945), Neighborhood Restaurant Partners Florida, LLC (Case No. 26-53946), and Neighborhood Restaurant Partners Florida Two, LLC (Case No. 26-53948) -- operate 53 Applebee's Neighborhood Bar & Grill locations across Florida, Georgia, and Alabama under franchise agreements with Dine Brands Global, Inc. The filing followed a decade-long decline from peak EBITDA of over $20 million in 2015 to negative combined EBITDA in fiscal year 2025, a failed prepetition marketing process that contacted 83 potential buyers without producing a viable transaction, and a pre-negotiated tentative agreement with the franchisor for a going-concern 363 sale. The court entered a bidding procedures order on April 16, 2026, scheduling a bid deadline of May 11, an auction on May 13, and a sale hearing on May 18, with a targeted closing by mid-May 2026. The debtors are operating on cash collateral with no DIP financing.

Debtor(s)	NRPF Group Two, LLC and 2 jointly administered affiliates
Court	U.S. Bankruptcy Court, Northern District of Georgia (Atlanta Division)
Lead Case Number	26-53945
Judge	Hon. Sage M. Sigler
Petition Date	March 24, 2026
Total Secured Debt	~$13.184 million (Equity Bank, disputed)
Auction Date	May 13, 2026
Sale Hearing	May 18, 2026
Claims Agent	Epiq Corporate Restructuring, LLC

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Applebee's Franchise Acquisitions and EBITDA Decline

NRPF Group Two, LLC is the holding company for two operating subsidiaries: Neighborhood Restaurant Partners Florida, LLC (NRP FL) and Neighborhood Restaurant Partners Florida Two, LLC (NRP FL 2). NRP FL acquired 50 Applebee's restaurants in the Tampa and Orlando markets in May 2012. NRP FL 2 acquired 15 additional restaurants in December 2012 across Florida, Georgia, and Alabama, bringing the original portfolio to 65 locations. NRPF Group Two is a sibling company to Summit Restaurant Group, the country's largest IHOP franchisee with more than 250 locations; Summit was not part of the filing.

Combined EBITDA grew from $13 million in 2013 to over $20 million in 2015. The First Day Declaration attributes the subsequent decline to unsuccessful operational strategies, the COVID-19 pandemic, and sustained inflationary pressures that increased operating expenses while reducing customer visits and average ticket sizes. By fiscal year 2025, the debtors' combined EBITDA turned negative. The Applebee's brand system as a whole reported comparable sales of negative 0.4% in Q4 2025, following a negative 4.2% result for full-year 2024.

The debtors closed 9 restaurants during fiscal year 2025 and 5 more in Q1 2026, reducing the footprint from 65 locations to the current 53 operating restaurants.

The NRP filing is the third Applebee's franchisee bankruptcy in recent years. Two other operators -- Louisiana Apple and Apple Central KC -- previously filed chapter 11, accounting for 22 combined locations. Dine Brands acquired 47 franchised Applebee's locations in 2025 as part of a renovation and refranchising plan, moving away from a fully franchised model as it absorbed units from financially distressed operators.

Failed Sale Process and Citizens Bank Marketing

The debtors retained Citizens Bank in March 2025 to run a marketing process. Over four to five months, Citizens Bank contacted over 83 groups, of which 17 expressed initial interest. No buyer was willing to purchase the assets and assume the associated leases and franchise agreements. Potential purchasers required closure of additional restaurants with uneconomical leases and concessions from landlords or the franchisor.

In February 2026, the debtors reached a tentative agreement with Applebee's (a subsidiary of Dine Brands Global, Inc.) to acquire approximately 53 restaurants along with the related leases and franchise agreements. The parties attempted to negotiate an out-of-court transaction, but CRO Katie S. Goodman stated that continuing financial pressures and cash flow constraints forced the filing before the deal closed. Dine Brands CEO John Peyton stated that serving as the stalking horse bidder allows the franchisor to be "strategic and selective in supporting the long-term health of the system" and described the NRP portfolio as one that "historically had solid performance".

363 Sale Schedule and Bidding Procedures

On April 16, 2026, the court entered an order and notice of hearing on the debtors' proposed bidding procedures, setting a hearing for April 20, 2026 at 2:00 PM in Courtroom 1201, Atlanta to consider the sale framework. The proposed schedule sets a bid deadline of May 11, 2026, an auction on May 13, 2026, and a sale hearing on May 18, 2026. The debtors expect to finalize a stalking horse asset purchase agreement with Dine Brands and close the going-concern 363 sale by mid-May 2026, consistent with the cash collateral budget that runs through May 3.

The April 20 hearing also covers the debtors' first omnibus motion to reject 10 executory contracts and unexpired leases and the application to retain SC&H Group as investment banker. A separate hearing on a motion to reject contracts involving CBRE and Citizens is scheduled for May 20, 2026.

Equity Bank Lien Dispute and Capital Structure

The debtors owed Equity Bank approximately $13,184,000 as of the petition date under loan agreements, promissory notes, guaranties, and security agreements dated November 19, 2020. Equity Bank asserts a first-priority lien on substantially all assets of the operating debtors, including real property, personal property, accounts receivable, and inventory. The claim is listed as disputed and unliquidated on all three debtors' schedules of 30 largest unsecured creditors, reflecting the debtors' position that the debt is unsecured.

Lien perfection challenge. A UCC search on February 9, 2026, revealed no UCC-1 filings for Equity Bank. A second search on March 5, 2026, showed that Equity Bank had filed UCC-1 financing statements against each operating debtor on or about February 17, 2026 -- approximately 35 days before the petition date and more than five years after the loan documents were executed. The debtors contend these were Equity Bank's first UCC-1 filings and assert they are avoidable as preferential transfers under section 547 of the Bankruptcy Code. If avoided, the debtors argue, Equity Bank's liens on personal property, accounts receivable, and other intangible assets would be unperfected and subject to avoidance under section 544, converting the $13.184 million claim from secured to general unsecured status. Equity Bank entered appearances on March 26, 2026, through counsel Bryan E. Bates and Doroteya Wozniak.

U.S. Foods. U.S. Foods, Inc. asserts a purchase money security interest in food inventory and other goods, securing approximately $1,187,000. U.S. Foods filed its original UCC-1 on February 22, 2013, with amendments in 2015, a continuation in 2018, and a second continuation in 2023. The debtors estimate the value of U.S. Foods' collateral at approximately $650,000. Goods delivered within 20 days of the petition date total at least $1,766,000, giving rise to an administrative priority claim under section 503(b)(9). The debtors also believe some or all of the claim is subject to Perishable Agricultural Commodities Act (PACA) trust protections.

Other significant unsecured claims. The debtors' creditor schedules list $4,639,374 owed to Applebee's Services under franchise agreements and loans (disputed), $1,105,943 to Realty Income Corporation for lease obligations, and smaller lease claims to SCF Realty Capital LLC, Bettja Jebailey LLC, and others. Total unsecured claims for Neighborhood Restaurant Partners Florida alone exceed $21.8 million across 2,909 creditors.

Cash Collateral and Six-Week Budget

The debtors sought authority to use cash collateral rather than new money DIP financing. The original Cash Collateral Motion projects a six-week consolidated budget through the May 3, 2026 termination date: total cash receipts of $16,742,386, total cash outflows of $15,931,467, net cash flow of $810,919, and an ending cash balance of $5,672,377. The debtors filed a follow-on cash collateral financing motion on April 15, 2026, to extend usage through the sale process.

Adequate protection for Equity Bank. The proposed adequate protection includes replacement liens on all personal property described in the prepetition loan documents, with the same priority as prepetition liens to the extent valid and non-avoidable. Replacement collateral excludes avoidance actions under sections 544, 547, 548, or 550 and their proceeds. The replacement liens are senior to the debtors and any successor trustee but junior to a professional fee carve-out.

U.S. Foods adequate protection. The debtors propose to pay the prepetition $1,187,000 U.S. Foods obligation in full in the ordinary course as invoices come due, citing U.S. Foods' PMSI, 503(b)(9) administrative priority, and PACA trust protections.

Termination provisions. Cash collateral usage terminates on the earliest of May 3, 2026, conversion to chapter 7 or dismissal, a court order prohibiting use, or the order being amended, vacated, or stayed. The permitted variance on aggregate disbursements (excluding professional fees) is 10% on a cumulative basis.

Lease Rejections and Employee Obligations

The debtors filed a first omnibus motion to reject 10 executory contracts and unexpired leases for closed or closing Applebee's locations, effective as of the petition date. Rejected locations span Florida and Georgia. Landlords on the rejected leases include American Environmental Foundation, Apple Kiss LLC, Ben Hur Celebration LLC, Bettja Jebailey LLC, J. Nazzaro Partnership, National South LLC, SCF Realty Capital LLC (three locations), and Volusia Mall LLC.

Employee obligations. The debtors employed approximately 2,000 employees and independent contractors as of the petition date. The debtors sought authority to pay prepetition employee obligations totaling approximately $1,280,000: $1,143,000 in gross payroll, $45,000 in "Instant Tip" program obligations, and $92,000 in employer payroll taxes. The debtors also sought to continue 401(k) contributions averaging approximately $20,162 per month (the debtors no longer provide matching contributions). The next payroll was scheduled for April 2, 2026.

Prepetition taxes. The debtors had collected but not yet remitted approximately $610,806 in sales and use taxes owed to various state and local taxing authorities, held in trust and entitled to priority under section 507(a)(8).

Professional Retentions and SC&H Fee Structure

The debtors retained Scroggins, Williamson & Ray, P.C. as general bankruptcy counsel, with J. Robert Williamson as lead attorney at $585-$645 per hour. The firm received a prepetition retainer of $607,403, of which $233,487 was applied to prepetition services, leaving $373,916.

Chief restructuring officer. GGG Partners, LLC was retained to provide CRO services through Katie S. Goodman. Goodman's hourly rate is $495, with associate rates of $375-$450 per hour. The prepetition retainer was $42,390 with a current retainer balance of $97,758.

Investment banker. SC&H Group was retained as investment banker, with the retention application set for hearing on April 20, 2026. The fee structure includes a $100,000 nonrefundable advance fee (paid March 20, 2026), monthly fees of $50,000 beginning on the 31st day, and a sale fee of 4% on the first $10 million, 3% on $10-17 million, and 4% above $17 million. For a sale to Dine Brands, the sale fee is discounted by 50%, with a minimum transaction fee of $325,000 (versus $425,000 for other purchasers). If Dine Brands is the sole purchaser, the advance fee and all monthly fees paid (up to $325,000) credit toward the sale fee.

Claims agent. Epiq Corporate Restructuring, LLC serves as the claims and noticing agent.

Key Timeline

Date	Event
May 2012	NRP FL acquires 50 Applebee's restaurants in Tampa/Orlando
December 2012	NRP FL 2 acquires 15 additional restaurants across FL, GA, AL
2015	Peak combined EBITDA exceeds $20 million; sales begin to soften
November 2020	Equity Bank loan agreements executed
FYE 2025	9 restaurants closed; combined EBITDA turns negative
March 2025	Citizens Bank retained to run sale process
Mid-2025	Citizens Bank process concludes without viable buyer (83 groups contacted)
February 9, 2026	UCC search reveals no Equity Bank filings
February 17, 2026	Equity Bank files UCC-1 financing statements
February 2026	Tentative agreement reached with Applebee's/Dine Brands for 363 sale
Q1 2026	5 additional restaurants closed
March 20, 2026	SC&H Group advance fee paid ($100,000)
March 24, 2026	Petition date; all three debtors file chapter 11
March 25, 2026	Complex case designation granted; joint administration ordered
March 26, 2026	First day hearing held; Equity Bank enters appearance
April 15, 2026	Follow-on cash collateral financing motion filed
April 16, 2026	Bidding procedures order entered
April 20, 2026	Hearing on bidding procedures, lease rejection, and SC&H retention
May 3, 2026	Original cash collateral termination date
May 11, 2026	Bid deadline
May 13, 2026	Auction
May 18, 2026	Sale hearing
May 20, 2026	Hearing on motion to reject CBRE and Citizens contracts
July 22, 2026	Chapter 11 plan and disclosure statement deadline

Frequently Asked Questions

Who filed for bankruptcy?

NRPF Group Two, LLC and two operating subsidiaries -- Neighborhood Restaurant Partners Florida, LLC and Neighborhood Restaurant Partners Florida Two, LLC -- filed chapter 11 petitions on March 24, 2026. The three entities collectively operate 53 Applebee's restaurants across Florida, Georgia, and Alabama.

What caused the bankruptcy?

The First Day Declaration attributes the filing to a decade-long decline from peak EBITDA of over $20 million in 2015 to negative EBITDA in fiscal year 2025, driven by unsuccessful operational strategies, the COVID-19 pandemic, and sustained inflationary pressures. A prepetition sale process through Citizens Bank contacted 83 groups and produced no viable buyer.

What is the sale schedule?

The court entered a bidding procedures order on April 16, 2026. The proposed schedule sets a bid deadline of May 11, 2026, an auction on May 13, 2026, and a sale hearing on May 18, 2026. Dine Brands is expected to serve as the stalking-horse bidder, with the going-concern 363 sale targeted to close by mid-May 2026. SC&H Group is acting as investment banker.

What is the Equity Bank lien dispute?

The debtors contend that Equity Bank's approximately $13.184 million secured claim may be avoidable because UCC-1 financing statements were not filed until February 17, 2026 -- approximately 35 days before the petition date and more than five years after the underlying loan documents were executed in November 2020. The debtors assert the late filings are avoidable preferences under section 547.

Who is the claims agent for NRPF Group Two?

Epiq Corporate Restructuring, LLC serves as the claims and noticing agent. The firm maintains the official claims register and distributes case notifications to creditors and parties in interest.

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