Hooters Bankruptcy Threat Imperils Even Securitized Bondholders

Holders of asset-backed bonds issued by a Hooters of America unit are seeking advice on their rights and options as the casual-dining franchise prepares a potential bankruptcy filing in the coming months, according to people with knowledge of the matter.

Investors in those bonds have expressed concern a bankruptcy may affect or impair their holdings, which could lose value or face restructuring as part of a larger plan to address Hooters’ liabilities, the people said. Some are huddling with law firm White & Case for guidance, according to one of the people, all of whom asked not to be identified ...