A two unit upscale Neapolitan pizza restaurant chain defaulted in its obligations to a secured creditor arising out of unexpectedly high equipment and fixturing costs incurred in the development of its second restaurant. When negotiation with the secured creditor reached an impasse, RLT commenced a Chapter 11 case for the pizza chain, rejected the lease for the high priced, newer, second but underachieving location, valued the collateral of the secured creditor at its forced sale amount with the help of a retained appraiser, and utilized the pressure of a cram down confirmation hearing to arrive at a consensual resolution of the secured creditor’s claim, as well as the personal liability of the restaurant owners, all incorporated in a plan of reorganization.
