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Kroll Bond Rating Agency Assigns Preliminary Ratings to HOA Funding, LLC – Series 2014-1 Senior Secured Notes

July 14, 2014



NEW YORK--(BUSINESS WIRE)-- Kroll Bond Rating AgencyKBRA”) announces the preliminary ratings to two note classes of HOA Funding, LLC, a whole business securitization.

Hooters Restaurant Group (“Hooters” or the “Company”) will pledge nearly all of its revenue-generating assets to several bankruptcy-remote special purpose vehicles as collateral for the offered notes. The collateral consists of all existing and future franchise agreements, Company-operated restaurants and related intellectual property.

The transaction is anticipated to include 415 restaurants, located in 42 states, Washington D.C. and 24 countries and territories. In the aggregate, Hooters restaurants generate nearly $1 billion a year in sales and serve an estimated 60 million customers per annum.

KBRA analyzed the transaction using the General Rating Methodology for Asset-Backed Securities published on July 30, 2012 and the General Corporate Rating Methodology published on November 15, 2013. KBRA also conducted an on-site operational review of Hooters at its Atlanta, GA headquarters in March 2014. KBRA will review the final operative agreements and legal opinions for the transaction prior to closing.

For complete details on the analysis, please see KBRA’s Pre-Sale Report, “HOA Funding, LLC – Series 2014-1 Senior Secured Notes”, which was published today at www.krollbondratings.com.

The preliminary ratings are based on information known to KBRA at the time of this publication. Information received subsequent to this release could result in the assignment of final ratings that differ from the preliminary ratings.

Preliminary Ratings Assigned: HOA Funding, LLC – Series 2014-1 Senior Secured Notes

 
Series 2014-1       Rating       Initial Principal Balance
Class A-1       BBB (sf)       $25,000,000
Class A-2       BBB (sf)       $275,000,000
           


About Kroll Bond Rating Agency

KBRA is registered with the U.S. Securities and Exchange Commission as a Nationally Recognized Statistical Rating Organization (NRSRO). In addition, KBRA is recognized by the National Association of Insurance Commissioners (NAIC) as a Credit Rating Provider (CRP).



Analytical Contacts:

Kroll Bond Rating Agency

Patrick McShane, 646-731-2376

pmcshane@kbra.com

Anthony Nocera, 646-731-2350

anocera@kbra.com

Source: Kroll Bond Rating Agency


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