Planet Hollywood filed for Chapter 11
bankruptcy protection Tuesday, a day after the movie-themed
restaurant chain closed nine of its 32 U.S. restaurants.
The Orlando-based company and 25 of its subsidiaries sought
protection from its creditors while it reorganizes its finances
with the filing in U.S. Bankruptcy Court in Wilmington, Del. The
company said Monday it would release its reorganization plan in the
"Today is the first step in our plan to position Planet
Hollywood for a return to long-term profitability and healthy
growth,'' said Robert Earl, chairman and chief executive officer,
The company's plan calls for upgrading several of its
movie-themed restaurants and menus, Earl said.
The restaurants closed Monday were in Chicago, Costa Mesa,
Calif.; Fort Lauderdale, Fla.; Gurnee, Ill.; Houston; Indianapolis;
Maui, Hawaii; Miami and Phoenix.
There may still be a couple of additional closings or franchise
conversions, the company said.
As part of the reorganization, Planet Hollywood International
Inc.'s two largest shareholders and a trust for Earl's children
have agreed to provide a $30 million cash infusion to help keep the
international chain of glitzy restaurants going.
The bankruptcy filing was the latest setback for the operator of
nearly 80 Planet Hollywood restaurants.
Former president William Baumhauer resigned in June, just three
months after the company's co-founder resigned his board position.
Keith Barish, who started the venture with Earl and actors
Sylvester Stallone, Demi Moore, Arnold Schwarzenegger and Bruce
Willis, left the company in March.
The company has been trying to cut operating costs by reducing
corporate overhead, putting in cost-control systems, streamlining
store-level operations and disposing of nonessential corporate
Despite those moves, analysts have said aggressive expansion and
increased competition have hurt the company.