Fat Brands - 40M USD A-2 Token

Overview

Fat Brands has completed an offering of $40 million of Series 2020-1 Fixed Rate Asset-Backed Notes (the “Notes”). The offering has been structured as a whole business securitization transaction through the creation of FAT Brands Royalty I, LLC (“FAT Royalty” or the “Issuer”). The Notes were priced with a weighted average fixed interest rate of 7.75% per annum.

The Notes, rated by DBRS Morningstar, were issued in two tranches with senior tranche, A-2, detailed below:

Issuer(s): FAT Brands Royalty I, LLC
Country: United States
Date: 3/6/2020
Class: A-2
Seniority: Senior
Rating BB
Size (USD): $20M
Coupon: 6.50%
Weighted Average Life: 1.99 Years
Interest-Only/ Non-Call Period: 12 months
First Call Date: 4/26/2021
Anticipated Repayment Date: 1/25/2023
Final Legal Maturity: 4/27/2026

The Company intends to use the proceeds from the Notes to repay existing indebtedness under its term debt; pay the transaction costs and fund the reserve accounts associated with the securitized financing facility; and for potential acquisitions, working capital and general corporate purposes, and the repayment of other indebtedness.

Cadence Group, Inc., a leading fintech securitization platform, was the structuring consultant of this transaction. Legal advisors to this transaction were Loeb & Loeb LLP and Foley & Lardner LLP for FAT Brands, and Manatt, Phelps & Phillips, LLP for Cadence Group, Inc.