Tully’s Coffee has filed for Chapter 11 Bankruptcy protection in U.S. district court. The coffee company, which has wholesale as well as retail operations in 20 branded cafes throughout the United States and a handful more overseas, says it also plans to close a number of its “underperforming” stores.
Founded in 1992 by Tom O’Keefe, Tully’s has traditionally focused much of its business in the Puget Sound area, and the company’s online business and brand were purchased by Green Mountain Coffee Roasters in 2009, which at the time allowed the company to pay off some debts.
According to the bankruptcy filing, made Tuesday, Oct. 9, the company has an existing debt to GMRC of $347,000. The filing also listed $5.9 million in personal property as its sole assets, as well as $2.6 million in unsecured credit.
“After careful consideration, our Board of Directors and Leadership Team believe that restructuring under the protection of Chapter 11 is a necessary step and the right thing to do for the future of the company,” Scott Pearson, president and CEO of TC Global, Inc., the parent company of Tully’s said in a prepared release. “The company will continue to have a formidable presence in the Puget Sound area.”
The company says it hopes to emerge from Chapter 11 bankruptcy in 2011. It has not announced which exact retail locations it plans to close.