On Nov. 3, 2024, Franchise Group Inc. (FRG) filed for Chapter 11 bankruptcy protection. Therefore, we lowered our issuer credit rating on the company to 'D' from 'CCC+'. At the same time, we lowered our issue-level rating on the company's first-lien term loan to 'D' from 'B-' and second-lien term loan to 'D' from 'CCC-'. FRG has also filed motions to ensure business continuity, including employee wage payments and benefits. The company announced it secured $250 million of debtor-in-possession financing to fund its operations as it works through bankruptcy proceedings. At the time of its filing, FRG's outstanding debt totaled approximately $2 billion. FRG's bankruptcy filing follows persistently weak operating performance with declines in revenues and EBITDA amid macroeconomic pressures
