Rubio’s Restaurants, a presence in San Diego for nearly four decades, cleared a major hurdle yesterday in its quest to emerge from bankruptcy by the end of this month, the San Diego Union-Tribune reported. A pre-negotiated plan for restructuring the company’s substantial debt of more than $72 million was approved by Bankruptcy Judge Mary F. Walrath, who commended the company, its lender and the committee representing unsecured creditors for working out their differences ahead of the hearing. Rubio’s had filed for chapter 11 protection only two months ago. As part of the plan, Golub Capital, Rubio’s long-time lender, has agreed to provide $52 million in so-called “exit” financing, of which $8 million was new funding to keep the company afloat during bankruptcy period and $7 million is new financing once the company emerges from bankruptcy. Owner Mill Road Capital has agreed to invest $6 million back into the company and in so doing will write off $2 million in liabilities. Golub, which is converting $18 million of its debt into equity and waiving remaining claims, will now hold an equity stake in Rubio’s. Company executives were unwilling to state who will have majority ownership in the chain. The $72 million in outstanding debt does not include a $10 million loan from the Paycheck Protection Program that, presumably, will be forgiven.
