X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

ORLANDO-Unsecured creditors of locally based Planet Hollywood International Inc. could lose a total $46 million if the once high-flying, celebrity-themed restaurant chain is unable to reorganize under its current Chapter 11 status.

That’s what U.S. Bankruptcy Judge Arthur B. Briskman is being told by Scott Shuker, an Orlando lawyer representing Robert I. Earl, the British-born chairman, CEO and president of Planet Hollywood.

The company is trying to reorganize under Chapter 11 for the second time in two years. Although Planet Hollywood owes a total $131 million, Earl is adamant in trying to keep his $600,000-a-year salary even as he slashes his budget ($8 million from $16 million), cuts staff (30 from 60), dismisses executives and tries to run the corporation almost single-handedly, court testimony shows.

If Earl fails to turn the company around and Planet Hollywood is forced to liquidate its $121 million in assets, only secured creditors such as lenders would recover their total $85 million in loans, according to court filings. Unsecured creditors such as vendors, suppliers and independent contractors would receive nothing.

Earl is confident he can save the company and will ask the judge in December again to restore his full $600,000 salary.

Planet Hollywood first filed for Chapter 11 protection under the U.S. Bankruptcy Code in October 1999 and completed a court-approved reorganization plan in May 2000. That reorganization was short-lived, however. The company filed for protection again on Oct. 15 of this year.

Planet Hollywood is down to 10 company-owned restaurants and 25 franchised operations in Asia, Europe and the United States. The chain had 60 active restaurants in three countries in 1999. In metro Orlando, the company continues to operate at Downtown Disney and Universal Orlando.

The company’s common is still listed at nine cents per share on the Over-the-Counter Bulletin Board. That price is unchanged from Nov. 19. There are 10 million shares outstanding. The company has a market capitalization of $900,000.

In the last 60 days, Planet Hollywood has closed six locations and vacated an estimated 180,000 sf in Washington, DC, Nashville, TN, San Diego, Atlanta, Baltimore and Seattle.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 3 free articles* across the ALM subscription network every 30 days
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

Dig Deeper

GlobeSt. NET LEASE Awards 2020Event

These awards honor the industry's most influential and knowledgeable real estate executives from the net lease sector.

Get More Information
 

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.