A Palm Beach, Florida-based operator of Moe’s Southwest Grill restaurants has filed for Chapter 11 bankruptcy protection, moving to shutter 16 more locations across Florida, Georgia, and Virginia and shrinking its footprint to just 22 stores. Quality Fresca I LLC’s filing caps years of contraction for a company that once ran nearly 70 of the fast-casual Tex-Mex restaurants.
Quality Fresca filed its Chapter 11 petition on August 4 in the U.S. Bankruptcy Court for the Southern District of Florida in West Palm Beach, listing between $1 million and $10 million in assets against $10 million to $50 million in total liabilities, according to The Real Deal. The company cited industry headwinds, increased costs, and declining revenue, per MLive.com, which reported that the franchisee has struggled with rising food costs, a lack of labor, and decreased foot traffic.
The company originally acquired 67 Moe’s Southwest Grill franchises in March 2020 and grew to 69 units the following year, according to Bondoro. From there, Quality Fresca closed underperforming stores every year since 2021, per MLive.com, whittling its portfolio down to 38 locations by the time it filed for bankruptcy.
A Balance Sheet That Never Caught Up
The numbers tell a story of a chain that kept losing ground even as it kept selling burritos. In fiscal year 2025, Quality Fresca recorded $58.9 million in net sales but still posted a consolidated negative EBITDA of $111,204, the same Bondoro report notes. The franchisee entered 2026 with $44 million in total assets set against $52 million in liabilities — a balance sheet already underwater before the Chapter 11 petition was filed…