Despite Cosi declaring bankruptcy, location near Penn expected to remain open

Cosi filed for bankruptcy last week, causing several of their locations in Philadelphia to close immediately. But it does not appear that the Cosi on 36th and Walnut streets will close.

As part of their bankruptcy announcement, the company announced the shutdown of 29 of its 74 locations nationwide, but has not yet released a list of which stores are closing. Two Cosi locations — at 1228 Walnut Street and 235 S. 15th Street — are no longer listed on the Cosi websites and, according to Philadelphia magazine, are not operational.

The outlets at 30th Street Station, 325 Chestnut Street and near Penn at 140 S. 36th Street are all still open, employees at the locations confirmed in phone conversations this week. Calls made to the Cosi at Temple University went unanswered.

When approached for comment, the staff at the 36th and Chestnut streets location said that they were not authorized to speak on the issue. However, Ashley Sweeney, a manager at the 30th Street Station outlet said the Cosi outlets on Penn’s and Drexel’s campuses are “high-value stores” which are likely to remain open for a “long, long time” even if ownership of the chain changes.

The Cosi restaurant chain, known for its square bagels, or “squagels,” has been in poor financial shape since 2015 when they posted a net loss of $15.7 million. Over the past year, the company’s stock has sunk by nearly 95 percent and in the bankruptcy petition they filed on Wednesday, the company listed $19.8 million in debts.

This bankruptcy petition came after a series of leadership changes at the company’s executive level. In August, Cosi’s Chief Financial Officer Miguel Rossy-Donovan submitted his resignation. At the same time, the company’s Board of Directors terminated the contract of Chief Executive Officer and President R.J. Dourney.

Going forward, the company is seeking a sale through section 363 of the bankruptcy code.

“We worked very hard to avoid this step,” said Cosi’s Chairman of the Board Mark Demilio in a statement. He said the company has “explored multiple paths,” including raising capital through equity and selling certain assets of the company.

Despite this, it has became clear to the Cosi Board of Directors that “the Company cannot continue to operate in its current financial condition, and that the best alternative for the Company and its creditors would be to accomplish a sale through the bankruptcy process.”

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