What was the date Checkers consummated 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 Out-of-Court Restructuring was consummated on June 16, 2023. Prior to this date, the financial statements reflect those of CDI before the restructuring and are referred to as "Predecessor." After June 16, 2023, the financial statements reflect those of CDI after the restructuring, referred to as "Successor."
This restructuring involved several key steps. Checkers obtained consent from all First Lien Lenders and Second Lien Lenders. Burger BossCo and its subsidiaries were deconsolidated from BossCo Holdings. Newly issued equity of Burger BossCo was issued to Checkers Topco, LLC. The secured creditors of Holdings and Burger BossCo acquired all of the equity of Topco. Finally, the equity of Burger BossCo owned by BossCo Holdings was repurchased by Burger BossCo for a nominal amount.
Because the Out-of-Court Restructuring resulted in a change in control of CDI's parent company, Checkers elected to apply pushdown accounting. This means that assets and liabilities were recorded at their fair values as of June 16, 2023. Due to these changes in accounting, the "Successor" and "Predecessor" financial statements are not directly comparable, which is a crucial consideration when reviewing Checkers' financial performance before and after this date.