APRIL 3, 2025 — BOOM! HOOTERS FILES FOR BANKRUPTCY, ASSETS SOLD, HOOTERS IS NOW FRANCHISEE-OWNED
Hooters of America Takes Strategic Action to Continue its Iconic Legacy Under Pure Franchise Business Model
Restaurants remain open, welcoming customers to enjoy its guest-obsessed hospitality and world-famous wings
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/.
FEBRUARY 27, 2025 — Original post…
Atlanta, Georgia-based Hooters of America, the casual dining chain notable for its busty female servers, has announced a restructuring initiative that could lead to a Chapter 11 bankruptcy filing.
The company has reportedly engaged law firm Ropes & Gray to prepare for a potential filing after abruptly closing dozens of locations in five states last year, raising further concerns about the brand's long-term viability.
Change is coming. There will always be a tomorrow, no matter how much you may try to ignore it. There are no guarantees in life or promises for a bright future. We see good people being laid off through no fault of their own. Just because something terrible hasn't happened yet doesn't mean it won't. It can happen to anyone, anytime, anywhere. No one is guaranteed to wake up tomorrow and still have a job by evening. While many employees can read the writing on the wall, why do most assume it’s targeted at someone else? Are you now wondering, Am I Next?
