FAT Brands Inc. filed SEC Form 8-K: Events That Accelerate or Increase a Direct Financial Obligation
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Item 2.04 Triggering Events That Accelerate or Increase a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement.
As previously reported by FAT Brands Inc. (the “Company”), the Company received notices of events of default (the “Default Notices”) under the base indentures (the “Indentures”) for its five special purpose financing subsidiaries, FAT Brands GFG Royalty I, LLC, FAT Brands Royalty I, LLC, FAT Brands Fazoli’s Native I, LLC, Twin Hospitality I, LLC and FB Resid Holdings I, LLC (the “Securitization Issuers”), relating to fixed rate secured notes issued by the Securitization Issuers (the “Securitization Notes”). The events of default listed in the Default Notices related to various matters, including the inability of UMB Bank, National Association (“UMB”), trustee under each of the Indentures, to make payments due to the noteholders as of the quarterly payment date of October 27, 2025 under each of the Indentures due to insufficient amounts deposited in the Collection Accounts for each of the Securitization Notes.
On November 17, 2025, the Company received notices of acceleration (the “Acceleration Notices”) from UMB with respect to Securitization Notes issued by four of the Securitization Issuers (FAT Brands GFG Royalty I, LLC, FAT Brands Royalty I, LLC, FAT Brands Fazoli’s Native I, LLC and Twin Hospitality I, LLC) (the “Accelerated Notes”). The Acceleration Notices stated that UMB, pursuant to Section 9.2 of each of the Indentures, acting at the direction of the Control Party under the Indentures, (i) accelerates and declares the outstanding principal amount of the Accelerated Notes issued under the respective Indentures to be immediately due and payable, (ii) declares the accrued and unpaid interest thereon through the date of acceleration to be immediately due and payable, and (iii) declares all other amounts due to the noteholders and the other Secured Parties under the Transaction Documents (as such terms are defined in the respective Indentures) to be immediately due and payable. At this time, there has been no foreclosure on the collateral securing the Accelerated Notes, but the Company cannot provide any assurance that will not occur.
The aggregate principal amount outstanding under the Accelerated Notes is $1,256.5 million, or $1,153.6 million net of Securitization Notes retained by the Company, and the aggregate amount of accrued and unpaid interest under the Accelerated Notes through the date of this report is approximately $43.2 million. The Company and the Securitization Issuers do not currently have amounts on hand to pay such principal and interest, and such acceleration or any subsequent foreclosure may materially and adversely affect the Company’s business, financial condition and liquidity, and could cause the Company and/or its subsidiaries to seek to reorganize through a bankruptcy proceeding.
The Company had been in discussions with representatives of the noteholders regarding one or more potential transactions involving a refinancing, restructuring or similar transaction of the Securitization Notes. The Company intends to continue pursuing those discussions, but cannot provide any assurances that it will reach an agreement on terms that are satisfactory to the Company and the noteholders promptly, or at all.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Date: November 21, 2025
| FAT Brands Inc. | ||
| By: | /s/ Kenneth J. Kuick | |
| Kenneth J. Kuick | ||
| Chief Financial Officer | ||