Paying the charge-off in full won't restart the clock on your drop-off date. Drop-off dates go by date of first delinquency, not last activity date. It is possible under some circumstances to re-start your clock but that usually happens when you negotiate with a debt collector on payment arrangements, especially if you were to miss one of the payments.
There is one big disadvantage to paying off the charge-off and that's that a paid collection and an unpaid collection have exactly the same effect on your credit score. So paying this isn't going to raise your score. Paying it is the right thing to do, of course, but before you pay in full, try to negotiate to get the tradeline removed from your credit report. Is the debt still with Hooters or has it been purchased by a Collection Agency? Try sending a lettter to whoever currently holds the debt telling them you'd like to pay the outstanding balance in full in return for their removing the charge-off from your credit reports. If they agree to do it, be sure to get it in writing from them before you send a penny. If it's not in writing, it didn't happen.
Sometimes you have to ask more than once before they'll agree to a PFD (pay for delete). It all depends on the culture of the company.Before you send out anything, I'd do some searching on this board for people's experience with getting PFDs from Hooters (or from your particular Collection Agency if the charge-off has already been sold). It will give you a much better idea of what you're up against and the best way to approach them.
Starting Score 7/5/10: 498 (EQ)