Most restaurant bankruptcies are won or lost before the case is ever filed.

The 90 days leading up to a filing are critical for New York restaurant owners: the moves you make (or don’t make) can affect everything from your ability to confirm a plan to whether certain payments get clawed back as “preferences.”

This checklist is not about hiding assets – that’s a quick path to disaster. It’s about organizing, stabilizing, and positioning your restaurant for the cleanest possible restructuring.

1. Get Your Financial House in Order

In the 90 days before a filing, focus on:

• Current financials – monthly P&Ls, balance sheets, and cash‑flow statements.
• Location‑level performance – which stores are profitable, break‑even, or bleeding out.
• 13‑week cash‑flow forecasting – a simple but powerful tool to manage short‑term liquidity.

You can’t build a credible plan – or convince a judge – without good numbers.

2. Gather and Organize Key Documents

Bankruptcy is paperwork‑heavy. Start pulling together:

• All commercial leases and amendments
• Loan documents, security agreements, and guarantees
• Tax returns (business and, if relevant, personal)
• Vendor contracts and franchise agreements
• Any pending lawsuits or demand letters

Having these documents at your fingertips will save enormous time and professional fees once the case starts.

3. Clean Up Operations Where You Can

You don’t need to wait for a judge to:

• Cut obviously unprofitable hours or menu items
• Reduce unnecessary expenses and plug obvious leaks
• Address management or staffing issues that hurt performance

A leaner, better‑run operation is more likely to survive a restructuring – and to persuade landlords and lenders that you’re serious.

4. Be Very Careful About Payments and Transfers

The 90‑day (and in some cases one‑year) period before a bankruptcy filing is heavily scrutinized for:

• Preferential payments – paying some creditors while others get nothing.
• Insider transactions – repayments to owners, family, or affiliate entities.
• Unusual transfers of assets for less than reasonably equivalent value.

Many of these transactions can be clawed back later. Do not start moving assets around or paying family loans without legal advice – it usually creates more problems than it solves.

5. Develop a Credible Story for Key Stakeholders

Even in bankruptcy, narrative matters:

• For landlords: why your concept will work going forward and why they should stick with you.
• For lenders: how their collateral is protected and how they’ll be repaid over time.
• For employees: why staying is in their best interest.
• For the court: why your plan is feasible and proposed in good faith.

Use the 90‑day window to refine your plan and message.

6. Assemble the Right Advisory Team

A solid pre‑bankruptcy team for a restaurant owner usually includes:

• Experienced bankruptcy/restaurant counsel
• A financial advisor or accountant who can build projections and models
• Sometimes a broker or investment banker if a sale is contemplated

Waiting until after you’re sued, evicted, or frozen out of accounts is almost always more expensive than getting help early.

Conclusion

Pre‑bankruptcy planning is not about playing games; it’s about putting your New York restaurant in the best possible position to reorganize honestly and transparently.

If you think a filing might be on the horizon – even if you’re not sure – the right time to start this checklist is now, not the night before your landlord locks the doors.  Our team at DHC Legal is here to help you through it all.