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KBRA Assigns Preliminary Ratings to Jersey Mike’s Funding, LLC 2021-1 Senior Secured Notes

·4-min read

NEW YORK, November 29, 2021--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to two classes of notes from Jersey Mike’s Funding, LLC 2021-1, a whole business securitization.

Jersey Mike’s Franchise Systems, Inc. ("Jersey Mike’s", or the "Company") and certain of its affiliates completed its first whole business securitization (WBS) in December 2019. The transaction is effected pursuant to a base indenture, and the Series 2021-1 Class A-2 Notes (the "Series 2021-1 Notes") represent the second securitization by Jersey Mike’s Funding, LLC (the "Master Issuer") under the base indenture, which was established in December 2019. The Master Issuer is expected to issue $500 million of Series 2021-1 Notes. The collateral includes existing and future franchise and license agreements, existing and future company-operated restaurant royalties, certain technology and franchise-related fees, vendor program payments and intellectual property. The proceeds from the offered notes will be used to fund investments in the business, pay transaction fees and expenses and fund general corporate purposes, which include a return of capital to the Company’s equity holders.

A Sub Above, LLC (the "Franchisor") is the franchisor and operator of restaurants under the Jersey Mike’s brand. As of September 30, 2021, the Jersey Mike’s restaurant system included 2,025 locations in the US and Canada. The transaction includes royalty payments from 2,012 franchise locations and 13 domestic company-operated restaurants, representing approximately 99% and 1% of total system-wide locations, with annual system-wide sales of approximately $2.1 billion.

In conjunction with the issuance of the Series 2021-1 Notes, KBRA anticipates affirming the ratings on the Master Issuer’s outstanding Series 2019-1 Class A-2 Notes (the "Existing Notes", and together with the Series 2021-1 Notes, the "Notes"). The ratings are consistent with the results of our cash flow scenarios following the addition of the Series 2021-1 Notes.

Click here to view the report. To access ratings and relevant documents, click here.

Related Publications


Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at

About KBRA

Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority pursuant to the Temporary Registration Regime. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized by the National Association of Insurance Commissioners as a Credit Rating Provider.

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Analytical Contacts

Xilun Chen, CFA, Senior Director (Lead Analyst)
+1 (646) 731-2431

Anna Roginkin, Associate Director
+1 (646) 731-1212

Steven Broccoli, CFA, Associate Director
+1 (646) 731-1320

Edward Napoli, Director
+1 (646) 731-1284

Rosemary Kelley, Senior Managing Director (Rating Committee Chair)
+1 (646) 731-2337

Business Development Contact

Ted Burbage, Managing Director
+1 (646) 731-3325

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