On what date did Checkers complete the Out-of-Court Restructuring?
Checkers Franchise · 2025 FDDAnswer from 2025 FDD Document
On June 5, 2023, Burger BossCo, Holdings, CDI, and certain of their affiliates commenced solicitation of consents to an out-of-court restructuring of the capital structure of Burger BossCo (the "Out-of-Court Restructuring") from holders of (a) loans under that certain Amended and Restated First Lien Credit Agreement, dated as of August 21, 2019 (as amended, restated, supplemented or otherwise modified from time to time, the "First Lien Credit Agreement" and such loans, the "First Lien Loans"), by and among Holdings, Burger BossCo, the lenders from time to time party to the First Lien Credit Agreement (the "First Lien Lenders"), and Jefferies Finance LLC, as administrative agent and collateral agent for the First Lien Lenders, and (b) loans under that certain Amended and Restated Second Lien Credit Agreement, dated as of August 21, 2019 (as amended, restated, supplemented or otherwise modified from time to time, the "Second Lien Credit Agreement" and such loans, the "Second Lien Loans"), by and among Holdings, Burger BossCo, the lenders from time to time party to the Second Lien Credit Agreement (the "Second Lien Lenders"), and Wilmington Trust, National Association, as administrative agent and collateral agent for the Second Lien Lenders. Checkers obtained consents to the Out-of-Court Restructuring from all of the First Lien Lenders and all of the Second Lien Lenders and consummated the Out-of-Court Restructuring on June 16, 2023, whereby Burger BossCo and its subsidiaries were deconsolidated from BossCo Holdings, newly issued equity of Burger BossCo was issued to Checkers Topco, LLC ("Topco"), the secured creditors of Holdings and Burger BossCo acquired all of the equity of Topco, and the equity of Burger BossCo owned by BossCo Holdings was repurchased by Burger BossCo for a nominal amount.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 91)
What This Means (2025 FDD)
According to Checkers' 2025 Franchise Disclosure Document, the company consummated its Out-of-Court Restructuring on June 16, 2023. This restructuring involved obtaining consents from both First Lien Lenders and Second Lien Lenders. As a result of the restructuring, Burger BossCo and its subsidiaries were deconsolidated from BossCo Holdings. Newly issued equity of Burger BossCo was issued to Checkers Topco, LLC, and the secured creditors of Holdings and Burger BossCo acquired all the equity of Topco. Additionally, the equity of Burger BossCo, which was previously owned by BossCo Holdings, was repurchased by Burger BossCo for a nominal amount.
The FDD indicates that the Out-of-Court Restructuring was initiated on June 5, 2023, when Burger BossCo, Holdings, CDI, and certain affiliates began soliciting consents for the restructuring of Burger BossCo's capital structure. This solicitation targeted holders of loans under the First Lien Credit Agreement and the Second Lien Credit Agreement. The successful completion of this restructuring on June 16, 2023, marked a significant change in the company's financial structure and ownership.
For a prospective franchisee, the Out-of-Court Restructuring is a noteworthy event as it reflects a significant change in the financial structure and ownership of Checkers' parent company. Understanding the implications of such restructurings is crucial for assessing the stability and future direction of the franchise. Franchisees should seek clarification from Checkers regarding the long-term impact of the restructuring on franchise operations, support services, and overall brand strategy.