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Checkers Drive-In Restaurants, Inc. (Nasdaq: CHKR)reported December 28 the sale of 13 Rally's restaurants in the Birmingham, Alabama market area to HJK, L.L.C. for $3.7 million. HJK, L.L.C. is an affiliate of Frontrunners, Inc., a company that currently operates 2 Rally's in Alabama. HJK, L.L.C. will operate the newly acquired Rally's restaurants as a franchisee and pay ongoing royalties based on sales at the restaurants. Checkers also announced the completion of a $3.6 million sale-leaseback transaction with Franchise Finance Corporation of America involving nine properties. The Company intends to use the net proceeds from these transactions to reduce existing debt.
"These transactions represent two additional steps that the Company has taken to restructure our short-term debt requirements," stated Peter O'Hara, Vice Chairman of the Board. "In addition to the sale-leaseback transaction, we have now sold 55 restaurants in three markets to franchisees, and we expect to complete other transactions in the near future."
Checkers Drive-In Restaurants, Inc. and its franchisees own approximately 467 Checkers operating primarily in the Southeastern United States and approximately 465 Rally's operating primarily in the Midwestern United States.