Quiznos (Photo credit: Wikipedia)

The sandwich chain Quizno's Corporation has filed for prepackaged bankruptcy protection. The announcement came Friday, after years of struggling with high debt and rising competition for years. Known for trailblazing the idea of toasted subs, Quiznos reps say the restructuring will slash the company's debt by more than $400 million. In its bankruptcy petition, the company listed its debts at between $500 million - $1 billion.  They say all but 7 of its nearly nearly 2,100 franchisee owned and operated restaurants will be unaffected.

Quiznos has received $15 million in debtor-in-possession financing from its senior lenders in an effort to keep it operating during the restructuring phase. 

The company has been facing tough competition from Subway, one of the biggest fast-food chains on the planet, and also newcomer Potbelly Corporation. Their lower priced menu items are extremely appealing to consumers in these tough economic times. Fewer jobs means less spending on non-essential items.

Pizza chain Sbarro LLC also recently filed for its second bankruptcy in 3 years due to less customers and sales as well.