The situation could go from bad to worse for Kona Grill. In the company’s annual report, filed April 16, Kona Grill revealed it might be on the verge of bankruptcy, despite what happens during its current strategic review. In late March, along with news that chief executive Marcus Jundt was stepping down, the company said it retained Piper Jaffray as financial adviser to explore and evaluate potential strategic alternatives, including the possible sale of the company.

But even if the company is successful in that task, or in improving its capital structure, a chapter 11 filing could be unavoidable, the company said in the filing.

READ MORE: Why are so many restaurants going bankrupt?

In addition, Kona Grill announced yet another executive change. Jundt’s departure was the fourth switch since August. He took over as sole CEO in January, less than two months after Kona Grill attempted a dual arrangement with Jundt and restaurateur Steve Schussler. That after COO Jim Kuhn, who replaced Berke Bakay, stepped down in November. Kuhn is also suing the company (more on this later).

CFO Christi Hing held down the interim post. Now, Jonathan Tibus, managing director with turnaround firm Alvarez & Marsal, stepped into the lead spot, effective April 17. He has no shortage of experience with brands on the brink. He served as CEO of Real Mex Restaurants (Chevy’s, El Torito, Sinigual, and Las Brisas), and led the since dissipated Ignite Restaurant Group (Joe’s Crab Shack and Brickhouse Tavern) and Last Call Operating Co. (Fox & Hound, Champps). All of those companies filed for bankruptcy protection. Real Mex Restaurants did so this past summer. Tibus also served as chief restructuring officer at Quiznos, a quick-service brand that emerged from bankruptcy in 2014, and chief operating officer of Max & Erma’s, which filed for chapter 11 protection in 2009 and nearly shuttered all of its restaurants.

In other moves, Kona Grill named Christopher Wells, also a managing director at Alvarez & Marsal, chief restructuring officer. He previously worked as CFO at Real Mex Restaurants.

The concerns are wide-ranging for Kona Grill. The company said it currently has $33.2 million in secured debt and missed its quarterly principal payment due March 31.

Kona Grill said it has not received an acceleration notice from its secured lenders and, furthermore, given its same-store sales declines, is “doubtful that we can obtain debt refinancing on terms acceptable to the company.” The company received a notice of default in early April after failing to make its payment and failing to provide lenders with audited financial statements.

“In the event that we cannot refinance the company or otherwise obtain new capital, or in the event that no third party acquires our secured debt and renegotiates its terms, the company may be required to file for chapter 11 protection of the U.S. Bankruptcy Code,” Kona Grill said in the filing.

Kona Grill’s same-store sales dropped 12.3 percent in 2018 after declining 5.9 percent in 2017. This after six consecutive years of comparable restaurant sale increases.

Revenue fell 12.4 percent in the fiscal year that ended December 31, year-over-year.

The chain’s footprint is shrinking, too. Kona Grill doubled the size of its company from 23 restaurants in 2012 to 46 by 2017. Since January 1, it closed 12 restaurants and terminated two leases for units not yet opened. There are now 34 locations in 20 states throughout the U.S. and Puerto Rico.

Kona Grill said it discontinued, for the time being, further development to focus on giving its existing base of restaurants the opportunity to mature, “conserve our cash resources” and close unprofitable units.

This past year, Kona Grill also terminated an agreement in regards to development in Mexico and said it is not currently actively pursuing international franchisees, although it would if appropriate.

In sum, Kona Grill is battening down the hatches as it tries to reroute its performance. “… our international franchise units could result in significant distraction or diversion of resources from our existing operations in the U.S.,” the company said.

Kona Grill provided a lengthy list of the factors challenging its business right now—issues that could “result in future impairments.”

A main lever is Kona Grill’s reliance on real estate in high-traffic areas, like retail centers, shopping malls, and lifestyle centers. The company said it depends on high consumer traffic rates at these venues to attract guests to its restaurants.

“In general, such visit frequencies are significantly affected by many factors, including national, regional or local economic conditions, anchor tenants closing in retail centers or shopping malls in which we operate, changes in consumer preferences or shopping patterns, changes in demographic and economic patterns in neighborhoods and trade areas where our restaurants are located, higher frequency of online shopping, changes in discretionary consumer spending, changes in gasoline prices, or otherwise,” the company said.

It noted that “several shopping malls,” experienced declining consumer traffic in recent years. And that if visitor rates to these centers continues to decline, Kona Grill’s unit volumes would plummet alongside.

Kona Grill swung a net loss of $31.968 million last year compared to $23.432 million the previous year. That’s 20.4 percent of restaurant sales.

Average-unit volumes dropped to $3.492 million in 2018 from $4.119 million the previous year. EBITDA was negative $15.9 million.

As for how Kona Grill plans to turn sales around, the company highlighted some of its differentiating factors. The brand’s happy hour and bar business, which it previously said it wanted to revamp, provides a year-round sales opportunity and is a key driver in generating business during non-traditional periods, the company said. Aggregate revenue during these non-peak periods accounted for 22.4 percent of Kona Grill’s sales during 2018, “which we believe provides us with a competitive advantage,” it said.

Kona Grill spotlighted a “multiple daypart model” as well. Between sharable items, sushi, and bar bites, the brand said it’s ability to attract customers throughout the day distinguishes it from other casual-dining brands.

“We have revitalized our legendary happy hour by expanding the number of food and drink offerings, reducing prices and extending the hours that happy hour is available. We are revamping our core menu to bring back certain items that made us successful in the past and right-sizing the menu to allow for consistent and timely delivering of our food and drink offerings,” Kona Grill said.

Last year, lunch represented 25.5 percent of Kona Grill’s business and dinner accounted for 52.1 percent. Sushi sales accounted for 28 percent of total revenue and alcoholic beverage sales represented 26 percent.

Returning to note earlier about Kuhn, Kona Grill said he commenced a civil action in the United States District Court for the District of Maryland on February 1. It was related to the termination of his employment by Kona Grill and alleges that Kona Grill breached Kuhn’s executive employment agreement and that Kuhn seeks certain payments to which he says he was entitled to upon his ouster. Kona Grill filed a response denying Kuhn’s claims on February 22. Six days later, it also commenced a separate action against Kuhn for his alleged breach of fiduciary duties owed to the company under Arizona law.

These issues mark the latest chapter in a run rough for Kona Grill.

In January, the Nasdaq Stock Market notified Kona Grill it failed to comply with market rules and could be delisted. According to documents filed, Kona Grill fell below Nasdaq’s listing standard of $15 million minimum market value within the previous 30 consecutive business days. The brand was trading for 63 cents Wednesday afternoon.

During the third quarter of 2018, the brand witnessed a same-store sales drop of 14.1 percent, driven primarily by a double-digit decrease in customer traffic. Stacked on the prior-year quarter’s 7.2 percent fall, Kona Grill was on a 20-plus percent two-year decline of comparable results.

Kona Grill was riding a strong string of results until the downturn. Bakay, an activist investor and director, was named CEO in 2012 and helped Kona Grill’s stock more than quadruple in the next three years. It also scaled up units in that span. The brand had 22 locations when Jundt first departed in 2009 and was at 44 this past September following the closure of two restaurants. All but one of those new locations opened between 2013–2017. Some more recognizable restaurants, like a store on Las Vegas’ Strip and one in Miami, shuttered last year.