DBRS Morningstar Maintains Under Review with Negative Implications Status on FAT Brands Royalty I

DBRS, Inc. (DBRS Morningstar) maintained the Under Review with Negative Implications status on the BB (sf) and B (sf) ratings on the Class A-2 and Class B-2 Notes, respectively, issued by FAT Brands Royalty I, LLC. Both classes of securities were placed Under Review with Negative Implications on April 22, 2020. For more information, please refer to the April 22, 2020, press release titled “DBRS Morningstar Takes Rating Actions on Two FAT Brands Royalty I, LLC Securities.”

Maintaining the Under Review with Negative Implications status on the notes considers DBRS Morningstar’s set of macroeconomic scenarios for select economies related to the coronavirus, available in its commentary “Global Macroeconomic Scenarios: July Update,” published on July 22, 2020. DBRS Morningstar initially published macroeconomic scenarios on April 16, 2020, which were last updated on July 22, 2020, and are reflected in DBRS Morningstar’s analysis. The moderate scenario assumes some success in containment of the Coronavirus Disease (COVID-19) within Q2 2020 and a gradual relaxation of restrictions, enabling most economies to begin a gradual economic recovery in Q3 2020.

The resurgence of cases of coronavirus across certain states presents continued uncertainty. New business closures in states experiencing upticks in coronavirus cases could potentially delay reopening and revenue recovery efforts, particularly for the restaurant industry, which relies on on-premises dining as an important component to drive revenue generation. Consequently, DBRS Morningstar expects the performance of certain whole-business securitization transactions to be negatively affected.

When a rating is placed Under Review with Negative Implications, DBRS Morningstar seeks to complete its assessment and remove the rating from this status as soon as appropriate. Upon the resolution of the Under Review status, DBRS Morningstar may confirm or downgrade the ratings on the affected classes.

ESG CONSIDERATIONS
A description of how DBRS Morningstar considers ESG factors within the DBRS Morningstar analytical framework and its methodologies can be found at: https://www.dbrsmorningstar.com/research/357792.

This press release was amended on March 10, 2021, to reflect the U.S. ABS General Ratings Methodology (December 2018), as the previously released press release inadvertently mislabeled the methodology used.

Notes:
The principal methodology is the U.S. ABS General Ratings Methodology (December 2018), which can be found on dbrsmorningstar.com under Methodologies & Criteria.

For more information regarding rating methodologies and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/357883.

For more information regarding structured finance rating methodologies and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/358308.

For more information regarding the structured finance rating approach and Coronavirus Disease (COVID-19), please see the following DBRS Morningstar press release: https://www.dbrsmorningstar.com/research/359905.

The rated entity or its related entities did participate in the rating process for this rating action. DBRS Morningstar had access to the accounts and other relevant internal documents of the rated entity or its related entities in connection with this rating action.

For more information on this credit or on this industry, visit www.dbrsmorningstar.com or contact us at info@dbrsmorningstar.com.

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