The vegetarian fast food chain Clover Food Lab, headquartered in Boston, has initiated Chapter 11 bankruptcy proceedings as per the recent court documents.

Filed in the federal bankruptcy court of Delaware, the company pointed to diminished sales, burdensome rent, and a shortfall in funding as the primary factors necessitating this move. The filing indicates that Clover Fast Food, Inc. is pursuing Chapter 11 protection to enable a stabilization and restructuring effort for the business, which has struggled to bounce back following the pandemic.

Originally launched as a food truck in 2008, Clover has since expanded into a series of physical locations. The chain, celebrated for its plant-based menu and commitment to locally sourced ingredients, currently runs 12 restaurants and two kiosks inside Whole Foods stores, alongside its catering operations and a meal box production and delivery service.

With the onset of the pandemic, Clover shifted its focus to meal box sales and received some government aid, as detailed by CEO Julia Wrin Piper in the bankruptcy documents.

The company has also encountered difficulties with the leases of three of its outlets, which are characterized by steep rents coupled with poor sales. Efforts to negotiate these lease terms with landlords have been made, as noted in the filing.

In August, Clover was forced to shut down its Back Bay location, which was reportedly incurring annual losses of $350,000, following a dispute with the landlord of the property. Despite attempts to reach an agreement, no progress was made.

Clover’s bankruptcy filing outlines a plan to fortify the business through a strategic reorganization of its operations and financial structure. The company intends to cancel leases for its less successful locations with rents above market rates, offload some of its delivery fleet, and realign its focus on the most lucrative aspects of its business.