Status of originator. Sonic Drive-In, a nationwide chain of restaurants noted for its signature bellhop attendants, is marketing a fifth issuance of notes backed by franchise-fee revenues through its whole-business securitization master trust. (Arby’s and Jimmy John’s have also sponsored whole-biz deals in recent years.). Sonic operates and franchises the largest chain of drive-in restaurants in the U.S. with over 3,500 locations across 45 states. The proposal would require the government-sponsored enterprises to craft resolution plans similar to regulations imposed on the largest U.S. banks. This transaction represents the first securitization issued by Bojangles Issuer, LLC and is structured as a "whole business securitization" in which Bojangles’ Restaurants, Inc. will contribute most of its revenue-generating assets to the Issuer. Whole-business securitization, or WBS, is a practice a company can use to issue bonds backed by many of its revenue streams. A whole business securitization is a finance method backed by cash flows generated from “business” itself (or sometimes including cash flows generated from asset sale, etc.) Sonic has utilized whole-business securitization to finance operations since 2013, when it was independently owned. Experience Our finance and securities practices are consistently ranked among the world’s best in each area, and have recently received practice-wide and individual lawyer recognition in Chambers USA, The Legal 500, and U.S. News. Sonic Industries is returning to the securitization market with seven-year bonds backed by current and future franchise fees, restaurant royalties and other intellectual property. Inspire’s portfolio of restaurants includes Arby’s, Buffalo Wild Wings, Jimmy John’s and Rusty Taco. Inspire’s portfolio of restaurants includes Arby’s, Buffalo Wild Wings, Jimmy John’s and Rusty Taco. The consumer bureau said the bank’s migration to a new servicing platform led to unauthorized payment withdrawals, misrepresentations about what borrowers owed and violations of a prior 2015 enforcement action. Whole business securitizations, or the securitization of the entire future cash flows generated by the operations of a company--as opposed to just one existing asset class-- will be the next trend in asset-backed finance, says Michael Kanef, a managing director in the structured finance group at Moody's Investors Service. Moody's assigns definitive rating to Sonic Capital whole business/franchise fee securitization 19 Jul 2013 $155 million of securities rated New York, July 19, 2013 -- Moody's Investors Service has assigned a definitive rating of Baa2 (sf) to the Series 2013-1 Class A-2 Senior Secured Notes (the Notes). Sonic Corp. (Nasdaq: SONC) is marketing $170 million in bonds backed by royalties and franchise fees that will be issued through its whole-business securitization master trust. The Sonic system has been in operation for over 60 years and features 1950s-style décor. Apart from Dunkin’ Brands $1.7 billion franchise royalty securitization in 2006, $1.8 billion Sears Holdings transaction in 2007, and deals from Applebee’s and IHOP in 2007 were also one of the biggest intellectual property securitizations. 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In order to rate a whole business securitization, rating agencies have adopted an approach that combines elements of a structured or securitization transaction and a corporate transaction. The final balances of the Class A-2-I and A-2-II notes tranches may change by the time the deal closes, and the deal could be upsized to as much as $925 million, according to S&P Global Ratings. Collateral and Industries The company was acquired by Inspire Brands, the fourth-largest U.S. restaurant company by systemwide sales, in 2018. The nonbank lender is co-sponsoring a $258.4 million residential mortgage pool comprised entirely of wealthy borrowers with 15-year term contracts. Announces Completion of $40 Million Whole Business Securitization Transaction Transaction Significantly Lowers Cost of Capital Business Wire LOS ANGELES -- March 9, 2020 FAT(Fresh. The Pennsylvania senator, who will chair the Banking Committee if Republicans hold their majority, agreed to modify an amendment restricting the Federal Reserve’s emergency powers that Democrats had criticized as too extreme. The deal, Sonic Capital LLC will issue $575 million of notes with a preliminary ‘BBB’ rating from Standard & Poor’s. For example, Standard & Poor’s focuses on four key concerns. to a bankruptcy-remote, special purpose vehicle, which serve as collateral for the offered notes. Its whole-business securitization from 2019, rated triple-B by S&P Global Ratings, traded at more than 100 cents on the dollar on March 11, then tumbled to about 77 cents in April, Trace data show. The Series 2020-1 offering includes $400 million in A-2-I notes and $450 million in A-2-II notes, as well as a $25 million A-1 variable funding notes, according to presale reports. The Sonic Capital LLC Series 2020-1 deal’s total leverage is approximately 6.6x debt capacity to securitized net cash flow, which Kroll stated is higher than other WBS deals in the restaurant sector – comparable deals by Jack in the Box, Hardee’s/Carl’s Jr. and Wingstop produced debt levels between 5.5x and 5.9x. Sonic Capital LLC Series 2018-1 consists of a single-tranche of Class A-2 notes that will be used primarily to repay the outstanding $98 million balance on variable-funding notes issued through the drive-in chain’s 2016 … The $875 million Series 2020-1 Issuance from Sonic Capital LLC will raise funds to refinance outstanding notes from its 2013 and 2016 notes series, as well as repay debt with Sonic’s parent company, Mavericks Inc., formerly known as Inspire Brands. †Assessed based on "Stand-Alone Credit Profiles: One Component Of A Rating," published on Oct. 1, 2010. For reprint and licensing requests for this article. 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