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:

-- $200 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 that represent a worst-case pool construct derived from the concentration limits and eligibility requirements as defined in the Fourth Amended and Restated 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 after finalizing terms with its lender. DBRS Morningstar received documentation and finalized terms of the renewal and, upon review, confirmed the ratings on the notes.

DBRS Morningstar constructed a worst-case pool based on the concentration limits and eligibility requirements as defined in the Trust Indenture, then stressed the transaction cash flows of the underlying real estate to evaluate the transaction and assign ratings to the Class A and Class B Notes.

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.

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 the North American CMBS Surveillance Methodology, which can be found on www.dbrs.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 Global Structured Finance Related Methodologies document, which can be found on www.dbrs.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.

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@dbrs.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.

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

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