Hooters of America Takes Strategic Action to Continue its Iconic Legacy Under Pure Franchise Business Model
Enters into Restructuring Support Agreement to effectuate sale transaction to highly experienced franchisees
Restaurants remain open, welcoming customers to enjoy its guest-obsessed hospitality and world-famous wings
ATLANTA, March 31, 2025--(BUSINESS WIRE)--Hooters of America, LLC and certain of its affiliates (collectively "Hooters" or the "Company"), the original wing joint and a globally recognized iconic brand, today announced that it has entered into a Restructuring Support Agreement (the "RSA") with near unanimous support from its key stakeholders to effectuate a sale transaction that will facilitate the continued operation of the business under new ownership. Specifically, the Company has reached an agreement in principle with a highly experienced group of current franchisees (the "Buyer Group") to acquire and operate certain Company-owned Hooters locations. The Buyer Group is comprised of two existing Hooters franchisees (including Hooters Inc., the original Hooters founders), who collectively currently own and operate over 30% of the domestic franchised Hooters locations, including 14 of the 30 highest volume restaurants.
In conjunction with the proposed sale of the Company-owned locations, and with the widespread support of key stakeholders in its capital structure (who will exchange certain of their debt for equity in the Company), the Company filed voluntary petitions for chapter 11 cases in the United States Bankruptcy Court for the Northern District of Texas (the "Court"). The Company expects to move through this process swiftly, with the goal of emerging from chapter 11 in approximately 90-120 days.
"Our renowned Hooters restaurants are here to stay. Today's announcement marks an important milestone in our efforts to reinforce Hooters' financial foundation and continue delivering the guest-obsessed hospitality experience and delicious food our customers and communities have come to expect," said Sal Melilli, Chief Executive Officer of Hooters of America. "I've seen firsthand the incredible value and opportunities our brand brings to life, and I look forward to continuing that momentum well into the future. I'm incredibly grateful to our valued customers, partners, and employees for their continued support."
Importantly, Hooters restaurants remain open to serve customers and will continue to operate in a business-as-usual manner during its chapter 11 cases. As part of the Company's broader business transformation and planning, Hooters is evaluating the Company's operational footprint as part of its financial restructuring process to position itself to invest its resources in its strongest assets moving forward. The Company's current franchise operations, including its locations outside the U.S., are not impacted by the chapter 11 process and will continue to be operated by the Company's franchise and license partners.
"With over 30 years of hands-on experience across the Hooters ecosystem, we have a profound understanding of our customers and what it takes to not only meet, but consistently exceed their expectations," said Neil Kiefer, CEO of Hooters Inc., on behalf of the Buyer Group. "As we look toward the future, we are committed to restoring the Hooters brand back to its roots and simplifying HOA's operations by adopting a pure franchise model that will maximize the potential for sustainable, long-term growth. The foundation we've laid ensures the continued success of our brand – one that is driven by a relentless focus on delivering an exceptional experience each and every visit for our customers."
Hooters is seeking relief through a number of customary "first day" motions with the Court to facilitate a smooth transition into chapter 11 and operate in the ordinary course, including through honoring commitments to employees, customers, licensee partners, and vendors. To fund Hooters' operations without disruption during the chapter 11 cases, the Company is seeking approval of $40 million of debtor-in-possession ("DIP") financing from certain of its existing lenders, including $35 million of new capital. Upon Court approval, Hooters anticipates the DIP financing will provide ample liquidity to support operations during the chapter 11 process.
Upon completion of the chapter 11 process, all Hooters locations will be franchisee-owned.
Hooters has launched a dedicated website for stakeholders to get information about the chapter 11 cases at www.Hooters.com/our-future/.
Additional information regarding the chapter 11 process is available at https://restructuring.ra.kroll.com/Hooters. Stakeholders with questions can contact the Company's claims agent, Kroll, by calling (888) 575-4910 (U.S. / Canada) or (646) 844-3894 (International) or emailing HootersInfo@ra.kroll.com.
AdvisorsRopes & Gray LLP is serving as legal counsel, SOLIC Capital Advisors is serving as investment banker to the Company, Accordion Partners is serving as financial and restructuring advisor, and C Street Advisory Group is serving as strategic communications advisor. The Buyer Group is represented by North Point Mergers & Acquisitions and Morrison and Foerster is serving as their legal counsel. Sidley Austin LLP is serving as legal counsel and Houlihan Lokey is serving as investment banker to the prepetition term loan and DIP lenders. White & Case LLP is serving as legal counsel and M3 Partners, LP is serving as financial advisor to the Ad Hoc Group of Securitization Noteholders.
About Hooters of America, LLCHooters of America, LLC, is the franchisor and operator of Hooters and Hoots Wings by Hooters. Known for its world-famous Hooters Style chicken wings, the first Hooters opened its doors in 1983 in Clearwater, Florida. Expectations were so modest at the time that the simple fact the doors opened was deemed worthy of a toast. Since then, millions have been liberated from the ordinary at Hooters while enjoying great food, fun and one-of-a-kind hospitality that can only be served up by the Hooters Girls. For more information about Hooters visit www.hooters.com or follow us at twitter.com/hooters, facebook.com/hooters, instagram.com/hooters or on Snapchat at "hooters."
About Hooters Inc.Hooters Inc., founders of the Hooters concept, own and operate 22 Hooters Restaurants in Tampa Bay and Chicagoland and two Hoots locations in Chicagoland. For over 40 years, the Original Hooters group has been known for its World Famous Chicken Wings, fun atmosphere, and legendary service from the iconic Hooters Girls. For more information about Hooters Inc. please visit www.originalhooters.com or follow them on Twitter @originalhooters, Instagram @originalhooters and Facebook https://www.facebook.com/originalhooters.
View source version on businesswire.com: https://www.businesswire.com/news/home/20250331979797/en/
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