DBRS Morningstar Confirms Ratings of A10 Revolving Asset Financing I, LLC

DBRS Limited (DBRS Morningstar) confirmed the ratings of A10 Revolving Asset Financing I, LLC (the Issuer) as listed below:

-- $250 million Class A Senior Variable Funding Notes (the Class A Notes) at AA (low) (sf)
-- $10 million Class B Senior Subordinated Floating Rate Notes (the Class B Notes) at BBB (high) (sf)

The trends are Stable.

The ratings are based on a pool composed of commercial real estate loans derived from the concentration limits and eligibility requirements as defined in the Fifth Amended and Related Trust Indenture (the Trust Indenture). The transaction originally closed in October 2012 and was extended and upsized in October 2013. A10 Capital, LLC extended its revolving financing facility to November 2020 and upsized the Class A Notes from $200 million to $250 million after finalizing terms with its lender. DBRS Morningstar received documentation and finalized terms and, upon review, confirmed the ratings on the notes.

DBRS Morningstar constructed a pool based on previously issued transactions by A10 Capital, LLC and the concentration limits and eligibility requirements as defined in the Trust Indenture. The ratings address the likelihood of the timely receipt by the Class A Noteholders of interest and the ultimate repayment of principal on or before the legal final maturity date of the Issuer. The Class A Notes mature on the payment date occurring seven years following the date of the latest extension of the facility. The rating of the Class B Notes addresses the ultimate repayment of principal and, with regard to interest, the likelihood of the timely receipt by the Class B Noteholders of interest to the extent not deferred as provided for in the indenture and, if deferred, ultimate repayment of interest by its final legal maturity date. The Class B Notes shall mature on the payment date occurring three months following the legal final maturity date of the Class A Notes.

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.

DBRS Morningstar materially deviated from its principal methodology when determining the rating assigned to Class A as the quantitative results suggest a lower rating. The material deviation is warranted given the structural features (loan or transaction) and/or provisions in other relevant methodologies outweigh the quantitative model output.

All ratings are subject to surveillance, which could result in ratings being upgraded, downgraded, placed under review, confirmed, or discontinued by DBRS Morningstar.

Notes:
All figures are in U.S. dollars unless otherwise noted.

The principal methodology is North American CMBS Surveillance Methodology (March 6, 2020), which can be found on dbrsmorningstar.com under Methodologies & Criteria. For a list of the structured-finance-related methodologies that may be used during the rating process, please see the DBRS Morningstar Global Structured Finance Related Methodologies document, which can be found on dbrsmorningstar.com in the Commentary tab under Regulatory Affairs. Please note that not every related methodology listed under a principal structured finance asset class methodology may be used to rate or monitor an individual structured finance or debt obligation.

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 related regulatory disclosures pursuant to the National Instrument 25-101 Designated Rating Organizations are hereby incorporated by reference and can be found by clicking on the link under Related Documents or by contacting us at info@dbrsmorningstar.com.

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.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the rating process. Please note a sensitivity analysis is not performed for CMBS bonds rated CCC or lower. The DBRS Morningstar long-term rating scale definition indicates that ratings of CCC or lower are assigned when the bond is highly likely to default or default is imminent, thereby prevailing over a sensitivity analysis.

DBRS Limited
DBRS Tower, 181 University Avenue, Suite 700
Toronto, ON M5H 3M7 Canada
Tel. +1 416 593-5577