CHECKERS DRIVE-IN RESTAURANTS, INC. ANNOUNCES RECAPITALIZATION AGREEMENT; REDUCING DEBT BY $225 MILLION AND INJECTING NEW CAPITAL FROM LONG-TIME INVESTORS

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Jun 20, 2023, 10:00 ET

TAMPA, Fla., June 20, 2023 /PRNewswire/ -- Checkers Drive-In Restaurants, Inc., the owner, operator, and franchisor of Checkers® and Rally's® restaurants, today announced that it has closed a recapitalization with its lenders that strengthens the Company's balance sheet by reducing its long-term funded debt from approximately $300 million to $75 million. As part of this agreement, Checkers also receives an additional $25 million in new debt financing commitments to fund the Company's store remodeling program and other growth initiatives.

"This is a positive development for the Company and our stakeholders," said Frances Allen, President & CEO of Checkers Drive-In Restaurants, Inc. "This refinancing significantly strengthens our balance sheet by, among other things, equitizing our short-term debt maturities. The recapitalization provides us with the financial flexibility we need to better position ourselves to invest in and continue growing our business."

Under the terms of the agreement, majority ownership of the company shifts to Checkers' senior lenders led by Arbour Lane Capital Management, LP, Garnett Station Partners, and Guggenheim Investments.

"It is important to underscore how optimistic I am about the future of this Company," added Ms. Allen. "Our strong financial performance throughout the pandemic, and through the first two quarters of 2023 while in the midst of inflationary pressures, gives me great confidence that our strategic five-year plan is working, and we can grow profitably and achieve long-term success. Our cash position is strong, our balance sheet no longer has the drag of legacy debt, and we have the full commitment of our investors. Most importantly, we have outstanding employees and franchisees, and I want to thank them all for their dedication and hard work. I look forward to continuing to work alongside them and our other stakeholders as we continue to execute on our business plan."

Miller Buckfire is the Company's investment banker, and Paul, Weiss, Rifkind, Wharton & Garrison, LLP, is the Company's legal counsel. Province, LLC, is the senior lenders' financial advisor and Paul Hastings, LLP, is the senior lenders' counsel.

About Checkers Drive-In Restaurants, Inc.

Based in Tampa, Fla., Checkers Drive-In Restaurants, Inc., an iconic and innovative drive-thru restaurant chain known for its bold, craveable food, famous fries, exceptional value, and people-first attitude, operates and franchises both Checkers® and Rally's® restaurants. With more than 800 restaurants and room to grow, Checkers & Rally's is a proven brand with flexible building formats that is aggressively expanding across the country. Checkers & Rally's is dedicated to being a place where franchisees and employees who work hard can create opportunities for themselves, their families, and their communities. In recent years, the brand has earned several of the industry's most prestigious awards including: "#1 Most-Loved Fries" in 2021 and "#1 Most Craveable Fries" by Restaurant Business in 2019 and 2017; Best Franchise Deal and "Best Drive-Thru in America" by QSR Magazine; Top Food and Beverage Franchise by Franchise Business Review; the "Hot! Again" award from Nation's Restaurant News; several "Most Innovative" awards from Franchise Update Media; and has consistently been ranked on Entrepreneur's Franchise 500.

SOURCE Checkers Drive-In Restaurants