Facing an estimated $1 billion loss in the third quarter of 2016, Papa Murphys Family Owned The Mission Is Impossible Franchise has filed for Chapter 11 bankruptcy protection.
In an interview with Fortune, the family said they expect to lose around $600 million by the end of the year.
The bankruptcy filing was announced Friday by John M. Papino Sr., the father of the Papa Murphy brand.
The company has a $1.5 billion debt and expects to spend the remainder of 2016 filing for Chapter 7 bankruptcy.
The family’s plan is to sell the franchise and use the proceeds to fund their own medical and retirement expenses.
The Papinos also plan to take out an initial loan to pay for a new headquarters, but have not yet made a decision on whether to pursue that strategy.
They have been forced to sell most of their holdings in the company over the past several years due to a series of financial crises.
Papa Murphy Sought To Buy The Franchise From Mother-In-Law The family filed for bankruptcy protection in June 2015, and in July they asked for a bankruptcy court to order a sale of the franchise.
The bid failed, and the Papins sold their stake in the business in January 2016.
“This has been a challenging year, and our family has had to face a lot of pressure from our business partners and other business owners,” John Papino said in a statement.
“Our goal is to be able to return the business to profitability by the year-end.”
In the filing, the Papinos said they had been unable to find any qualified buyers for the franchise, citing a lack of qualified financing and other issues.
They also noted that they had already lost $800 million in the past three years, and that it would take up to a year for them to begin winding down operations.
The financial issues that led to the bankruptcy filing have also forced the family to make several changes to the way they handle their business.
In addition to restructuring the business and making it easier for Papa Murphy Family to sell off assets, the bankruptcy filings said they are considering eliminating Papa Murphy Sr.’s ownership of the business, which would allow the family, including Papino, to focus on running the business for themselves.
Papa Smirnoff Is Going To Sell Its Franchise In 2018 The Papins said that Papa Smirtys business was in “irretrievable decline” as it was struggling with a $100 million debt.
The brand, which began as an adult diaper company, is owned by Mimi Smirnsky, the sister of former New York Giants owner John Mara.
Mimi has a longstanding relationship with Papa Murphy, having been a big supporter of the brand and working closely with Papa Smirsons marketing team to create awareness for the brand.
“In light of the ongoing economic issues and the impending bankruptcy of Papa Murphy Brands, Mimi and Papa Murphy have decided to close Papa Smircons franchise,” the family wrote in their bankruptcy filing.
“Mimi and Papi have been committed to this partnership for many years and we look forward to continuing to support this remarkable family-owned business for many more years to come.”