Jack in the Box Inc. Completes $1.1 Billion Securitized Financing Facility

Rhea-AI Summary

Jack in the Box Inc. (NASDAQ: JACK) announced the sale of $1.1 billion in Fixed Rate Senior Secured Notes through its Master Issuer subsidiary. This includes $550 million in Class A-2-I Notes with a 3.445% interest rate and $550 million in Class A-2-II Notes at 4.136%. Proceeds will be used to repay existing debt and partially fund the acquisition of Del Taco Restaurants, Inc. The Master Issuer also plans to issue up to $150 million in Variable Funding Senior Secured Notes. This transaction is part of a private securitization and does not involve public registration.

Positive

• Raise of $1.1 billion through the sale of Fixed Rate Senior Secured Notes enhances liquidity.
• Proceeds will be used for debt repayment and to fund the acquisition of Del Taco, potentially boosting growth.

Negative

• The existing debt will be fully repaid, suggesting reliance on new financing.
• The company is entering into significant debt obligations with fixed repayment dates extending to 2032.

SAN DIEGO--(BUSINESS WIRE)-- Jack in the Box Inc. (NASDAQ: JACK) (the “Company”) today announced that one of its indirect, limited-purpose subsidiaries (the “Master Issuer”) has completed the sale of $550 million of its Series 2022-1 3.445% Fixed Rate Senior Secured Notes, Class A-2-I (the “Class A-2-I Notes”) and $550 million of its Series 2022-1 4.136% Fixed Rate Senior Secured Notes, Class A-2-II (the “Class A-2-II Notes” and, together with the Class A-2-I Notes, the “2022 Notes”). Interest payments on the 2022 Notes are payable on a quarterly basis. The anticipated repayment dates of the Class A-2-I Notes and the Class A-2-II Notes will be February 2027 and February 2032, respectively, unless earlier prepaid to the extent permitted under the indenture that will govern the 2022 Notes. The 2022 Notes were issued by the Master Issuer in a privately placed securitization transaction.

The net proceeds of the sale of the 2022 Notes are expected to be used to repay in full the Company’s existing Series 2019-1 3.982% Fixed Rate Senior Secured Notes, Class A-2-I and to distribute to Jack in the Box SPV Guarantor, LLC and thereafter to the Company to fund a portion of the Company’s acquisition of Del Taco Restaurants, Inc.

The Master Issuer also entered into a purchase agreement under which it will issue up to $150 million of its Series 2022-1 Variable Funding Senior Secured Notes, Class A-1 (the "Series 2022-1 Class A-1 Notes"), which will allow the Master Issuer to borrow amounts from time to time on a revolving basis. The Series 2022-1 Class A-1 Notes will replace the Company’s existing $150 million Series 2019-1 Variable Funding Senior Secured Notes, Class A-1.

This press release does not constitute an offer to sell or the solicitation of an offer to buy the 2022 Notes or any other security. The 2022 Notes to be offered have not been, and will not be, registered under the Securities Act of 1933 and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of the Securities Act of 1933.

 

About Jack in the Box Inc.

Jack in the Box Inc. (NASDAQ: JACK), based in San Diego, is a restaurant company that operates and franchises Jack in the Box® restaurants, one of the nation’s largest hamburger chains, with more than 2,200 restaurants in 21 states and Guam. For more information on franchising opportunities with Jack in the Box, visit JackintheBoxFranchising.com.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of the federal securities laws. Forward-looking statements may be identified by words such as “anticipate,” “believe,” “estimate,” “expect,” “forecast,” “goals,” “guidance,” “intend,” “plan,” “project,” “may,” “will,” “would” and similar expressions. These statements are based on management’s current expectations, estimates, forecasts and projections about our business and the industry in which we operate. These estimates and assumptions involve known and unknown risks, uncertainties, and other factors that are in some cases beyond our control. Factors that may cause our actual results to differ materially from any forward-looking statements include, but are not limited to: the potential impacts to our business and operations resulting from the COVID-19 pandemic, the success of new products, marketing initiatives and restaurant remodels and drive-thru enhancements; the impact of competition, unemployment, trends in consumer spending patterns and commodity costs; the company’s ability to achieve and manage its planned growth, which is affected by the availability of a sufficient number of suitable new restaurant sites, the performance of new restaurants, risks relating to expansion into new markets and successful franchise development; the ability to attract, train and retain top-performing personnel, litigation risks; risks associated with disagreements with franchisees; supply chain disruption; food-safety incidents or negative publicity impacting the reputation of the company's brand; increased regulatory and legal complexities, including federal, state and local policies regarding mitigation strategies for controlling the COVID-19 pandemic, risks associated with the amount and terms of the securitized debt issued by certain of our wholly owned subsidiaries; and stock market volatility. These and other factors are discussed in the company’s annual report on Form 10-K and its periodic reports on Form 10-Q filed with the Securities and Exchange Commission, which are available online at http://investors.jackinthebox.com or in hard copy upon request. The company undertakes no obligation to update or revise any forward-looking statement, whether as the result of new information or otherwise.

View source version on businesswire.com: https://www.businesswire.com/news/home/20220214005316/en/

Chris Brandon

619.902.0269

chris.brandon@jackinthebox.com

Source: Jack in the Box Inc.

FAQ

What was announced by Jack in the Box on the recent press release?

Jack in the Box announced the sale of $1.1 billion in Fixed Rate Senior Secured Notes.

How will the proceeds from the sale of the notes be used?

Proceeds will repay existing debt and partially fund the acquisition of Del Taco Restaurants, Inc.

What are the interest rates on the newly issued notes by Jack in the Box?

The Class A-2-I Notes have a 3.445% interest rate, and the Class A-2-II Notes have a 4.136% interest rate.

What is the total amount of notes issued by Jack in the Box?

Jack in the Box issued a total of $1.1 billion in notes.

What is the anticipated repayment date for the Class A-2-I and Class A-2-II Notes?

The anticipated repayment dates are February 2027 for Class A-2-I Notes and February 2032 for Class A-2-II Notes.