backKing & Spalding’s specialty finance team has closed a number of esoteric securitization transactions in the first half of 2021. Continuing to adapt to changing market conditions during this period, King & Spalding has worked on a range of specialty finance matters, and helped its clients to provide liquidity to the securitization markets, including a slate of digital infrastructure transactions and whole business securitizations in the restaurant, property restoration and home services industries.
Digital Infrastructure Securitizations
In a deal that closed on June 15, 2021, King & Spalding represented Diamond Infrastructure Funding LLC in the issuance of $665 million aggregate principal amount of securitized Series 2021-1 Secured Cellular Site Revenue Notes secured by assets and cash flow generated by a portfolio of cellular towers and other real property interests in the United States leased to companies in the wireless communications industry. The net proceeds were applied, among other things, to consummate the acquisition of Melody Wireless Infrastructure.
In a deal that closed on July 9, 2021, King & Spalding represented the sole structuring advisor and bookrunning manager in the sale of $450 million in notes ($150 million of which are Series 2021-1 Secured Fund Fee Revenue Variable Funding Notes and $300 million of which are Series 2021-1 Secured Fund Fee Revenue Secured Term Notes) backed by fund management and incentive fees of DigitalBridge Group, Inc. DigitalBridge is a global REIT that owns, operates and invests across the full spectrum of digital infrastructure and real estate including cell towers, data centers, fiber, small cells and edge infrastructure.
In a deal that closed on July 20, 2021, King & Spalding represented the sole structuring advisor and bookrunning manager in the sale of $250 million in notes ($25 million of which are Series 2021-1 Secured Data Center Revenue Variable Funding Notes and $225 million of which are Series 2021-1 Secured Data Center Revenue Secured Term Notes) backed by the data centers of Landmark Dividend Management 3 LLC. Landmark is a national, industry-leading investment management firm that acquires and develops real property interests and infrastructure across an array of asset classes, including wireless communications, digital infrastructure, outdoor advertising and renewable power generation industries. Landmark also acquires, develops, leases and operates a diverse and growing portfolio of enterprise, colocation, cloud, wholesale and retail data centers.
Multiple Restaurant Transactions
In a deal that closed on June 11, 2021, King & Spalding represented the sole structuring advisor and joint bookrunning manager and joint bookrunning managers in the sale of $985 million in notes ($75 million of which are Series 2021-1 Class A-1 Variable Funding Notes, $10 million of which are Series 2021-1 Class A-1 Liquidity Reserve Notes and $900 million of which are fixed rate Series 2021-1 Class A-2 Notes) backed by a whole-business securitization of the franchise assets of Zaxby’s Operating Company L.P. Zaxby’s is an authentic, founder-run franchisor and operator of limited-service chicken restaurants.
In a deal that closed on July 1, 2021, King & Spalding represented Five Guys Enterprises, LLC in the sale of $250 million in notes ($50 million of which are Series 2021-1 Class A-1 Variable Funding Notes and $200 million of which are fixed rate Series 2021-1 Class A-2 Notes) backed by a whole-business securitization of the franchise assets of Five Guys. This is the second series of securitization notes issued by Five Guys.
In a deal that closed on June 24, 2021, King & Spalding represented the sole structuring advisor and joint bookrunning manager, the co-manager and the several banks acting as joint bookrunning managers in the sale of $180 million fixed rate Series 2021-1 Class A-2 Notes backed by a whole-business securitization of the franchise assets of CKE Restaurants Holdings, Inc. The Series 2021-1 Class A-2 Notes are the fourth series of securitization notes issued by CKE. CKE is one of the world’s largest operators and franchisors of quick service restaurants and operates primarily under the Carl’s Jr. and Hardee’s brands.
In a deal that closed July 30, 2021, King & Spalding represented the sole structuring advisor and joint bookrunning manager in the sale of $358.75 million in notes ($280 million of which are fixed-rate Series 2021-1 Class A-2 Notes, $55 million of which are fixed-rate Series 2021-1 Class B Notes, $20 million of which are Series 2021-1 Class A-1 Variable Funding Notes and $3.75 million of which are Series 2021-1 Class A-1 Liquidity Reserve Notes) backed by the whole-business securitization of the franchise assets of Nothing Bundt Cakes. Nothing Bundt Cakes is the leading franchisor and operator of specialty bakeries offering high-quality desserts in the form of Bundt cakes.
Property Restoration and Home Services Securitizations
In a deal that closed on March 10, 2021, King & Spalding represented the sole structuring advisor and lead bookrunning manager in the sale of $260 million fixed rate Series 2021-1 Class A-2 Notes backed by a whole-business securitization of the franchise assets of Servpro Industries, LLC. The Series 2021-1 Class A-2 Notes are the second series of securitization notes issued by Servpro pursuant to a base indenture amended and restated on the closing date. Servpro is the largest and most recognized provider of property cleaning and restoration services in the United States, focused primarily on restoring properties affected by water, fire, mold and other damage.
In a deal that closed on March 25, 2021, King & Spalding represented the sole structuring advisor and sole bookrunning manager in the sale of $840 million in notes ($30 million of which are Series 2021-1 Class A-1 Variable Funding Notes, $10 million of which are Series 2021-1 Class A-1 Liquidity Reserve Notes and $800 million of which are Series 2021-1 Class A-2 Fixed Rate Senior Secured Notes) backed by a whole-business securitization of the franchise assets of Neighborly Company. Neighborly is one of the largest providers and franchisors of do-it-for-me home services in the United States, with a focus on repairing, maintaining, and enhancing consumers’ homes and properties.
In a deal that closed on May 14, 2021, King & Spalding represented the joint structuring agent and joint active bookrunner in the sale of $475 million in notes backed by a whole-business securitization of the franchise assets of Villa BidCo Inc. (d/b/a Authority Brands). Authority has a portfolio of 10 national home service brands including cleaning, in-home care, pool services, pest control, pet waste sanitation, plumbing, HVAC, electrical, tree removal and restoration, among others.
In a deal that closed on July 30, 2021, King & Spalding represented the sole structuring advisor and sole bookrunning manager in the sale of $400 million fixed-rate senior secured Series 2021-1 Class A-2 Notes backed by a whole-business securitization of the franchise assets of ServiceMaster Funding LLC and ServiceMaster of Canada Limited. The Series 2021-1 Class A-2 Notes are the second series of securitization notes issued by ServiceMaster pursuant to a base indenture amended and restated on the closing date.
These transactions follow King & Spalding's representation of several major investment banks and issuers in other recent, headline, esoteric securitizations. The King & Spalding finance team for the transactions was compromised of partners Michael Urschel, Ryan McNaughton, Jonathan Arkins, Matthew Sandiford, Jeff Misher, Conrad Axelrod, Matt Nichols and Matt Warren, counsel Kevin Manz, Mendel Yudin and Frank Schoen, senior associates Martin Eid, Katie Weiss, Katy Berger, Ben Snyder, Stephen Blank, Derek Marks and Dora Chan, associates Osahon Omoregie, Charlene Yin, Amber Dong, Joshua Saccurato, Thomas Prommer, Kathryn Wilson, Jeff Zhou, Valeriya Tatisheva, Tino Illiparambil, Parker Erickson and Navtej Ahuja, with assistance from partners Sarah Borders (bankruptcy), Tim Hoffmann (bankruptcy), John Taylor (tax), John Green (tax), John Sweet (tax), Robert Dedman (regulatory), Sam Choy (ERISA), counsel George Williams (regulatory), project attorneys Elizabeth Fox (intellectual property), Caroline Magee (finance), and Laura Huffman (litigation) and associates Roland Macher (real estate), Britney Baker (bankruptcy).