Bloomin' Brands Inc.
11/02/2026 | Press release | Distributed by Public on 11/02/2026 07:31
Material Agreement (Form 8-K)
Item 1.01 Entry into a Material Definitive Agreement
Out West Franchisee Voluntary Bankruptcy Petition
On November 2, 2026, Cerca Trova Restaurant Group Holdings, Inc. d/b/a Out West Restaurant Group and its direct and indirect subsidiaries (collectively "Out West"), an independently owned franchisee of Bloomin' Brands, Inc. (the "Company"), operating 61 Outback Steakhouse restaurants in the western United States, filed voluntary petitions for relief under chapter 11 of title 11 of the United States Code (the "Chapter 11 Filing") in the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court").
The Chapter 11 Filing has no immediate impact on any Out West or Company-owned Outback Steakhouse guests, restaurant Team Members, or day-to-day operations.
Out West will continue its business as "debtor in possession" under the jurisdiction of the Bankruptcy Court. Out West has sought customary relief from the Bankruptcy Court to permit it to continue operating in the ordinary course of business, including authority to pay certain prepetition employee, vendor, supplier and other obligations. Out West also intends to continue its day-to-day operations during the Chapter 11 process, including paying post-petition franchise fees and royalties owed to the Company and rent under leases guaranteed by the Company.
Bloomin' Brands is working closely with Out West, its lenders, and other stakeholders throughout the Bankruptcy Court-supervised process as it focuses on maintaining stability in Out West's restaurant operations, supporting Team Members and continuing to serve guests without disruption.
Stalking Horse Asset Purchase Agreement
Because the Company believes that securing these restaurants gives it direct operational insight, allows it to invest in the units through its development initiatives, and to mitigate disruption to guests and employees, on November 1, 2026, the Company entered into a "stalking horse" Asset Purchase Agreement (the "Asset Purchase Agreement") with Out West. Pursuant to the Asset Purchase Agreement, the Company agreed to purchase substantially all of the assets of Out West (such assets, the "Assets," and such transaction, the "Asset Sale") for a purchase price of (1) $26.3 million (a) less amounts owed under the DIP Facility (defined below) and (b) plus a dollar-for-dollar increase to the extent the aggregate amount of specified vendor liabilities assumed by the Company at closing is less than $6.1 million (with no increase if such specified liabilities equal or exceed $6.1 million) and (2) the assumption of certain liabilities (including lease obligations for future periods, unredeemed gift cards and specified vendor liabilities) as set forth in the Asset Purchase Agreement.
Upon Bankruptcy Court approval, the Company is expected to be designated as the "stalking horse" bidder in connection with the Asset Sale under section 363 of the bankruptcy code. The Asset Sale will be conducted through a Bankruptcy Court-supervised process pursuant to approved bidding procedures, in which the Company's bid is subject to the receipt of higher or otherwise better offers from competing bidders or at an auction held after the bid deadline (if applicable due to receiving qualified, competing bid(s)), approval of the Asset Sale by the Bankruptcy Court, and certain other conditions set forth in the Asset Purchase Agreement. The outside closing date under the Asset Purchase Agreement is January 31, 2027, after which date the Asset Purchase Agreement will terminate, unless extended in accordance with its terms.
The Asset Purchase Agreement contains customary representations, warranties and covenants of the parties for a transaction involving the acquisition of assets from a debtor in bankruptcy, and the completion of the Asset Sale is subject to a number of conditions, including under the procedures discussed above. The Asset Purchase Agreement also provides for a break-up fee payable to the Company upon the occurrence of certain events, including being outbid by qualifying bidders, and the forfeiture of a deposit to Out West upon the occurrence of certain events.
The foregoing description of the Asset Purchase Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Asset Purchase Agreement. Pursuant to applicable SEC rules, the Company intends to file the Asset Purchase Agreement as an exhibit to its Quarterly Report on Form 10-Q for the fiscal quarter ended September 27, 2026.
Debtor-in-Possession Financing
In line with the Company's efforts to facilitate a transaction that seeks to preserve the continued operation of the restaurants and minimize disruptions to guests and Team Members, the Company has also agreed to provide up to $5.5 million of debtor-in-possession financing (the "DIP Facility"), which will not bear interest. Out West has requested that the Bankruptcy Court issue an order approving the DIP Facility, with the terms to be set forth in the order. If the proposed DIP Facility is approved and customary conditions precedent are met, Out West can draw $1.5 million following entry of the interim approval order and the remainder following entry of the final approval order and bidding procedures and use the DIP Facility to pay ordinary operating expenses and professional and administrative costs of the Chapter 11 case, as needed, solely to the extent cash from operations is insufficient to maintain a minimum amount of liquidity. Out West is permitted to use its cash from operations only until January 4, 2027, and, as of such date the DIP Financing will terminate unless an Asset Sale has closed, unless such date is extended by its lenders. Repayment of any amounts drawn under the DIP Facility by Out West will occur through reduction of the purchase price under the Asset Purchase Agreement or by proceeds of the sale of Out West's assets to another party if the Asset Purchase Agreement is terminated. Repayment will also be required upon any earlier event of default or termination of the DIP Facility.
The proposed DIP Facility would also contain customary covenants and events of default, including as a result of certain events occurring in the Chapter 11 case.
The foregoing description of the proposed DIP Facility does not purport to be complete and is qualified in its entirety by the interim and final orders, if any, approved by the Bankruptcy Court.
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