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Fitch IBCA Places FMAC 1996-B On RatingAlert Negative

11 June 1999

Fitch IBCA Places FMAC 1996-B On RatingAlert Negative

    NEW YORK--June 10, 1999--Fitch IBCA places all classes of notes issued under FMAC 1996-B on RatingAlert Negative.
    This rating action is prompted by the negative performance of one large loan in the franchise pool and does not impact any other securitization pools originated by Franchise Mortgage Acceptance Co. L.L.C. (FMAC). Further, this rating action is in no way associated with FMAC in its function as servicer and/or special servicer of the pool.
    At closing, the $227.7 million FMAC 1996-B loan pool contained a $70 million loan to Midland Food Services (MFS). The MFS loan was originated by Credit Suisse First Boston, and was contributed to the 1996-B loan pool through a special purpose corporation. Subsequently, fixed charge coverage (FCCR) on this loan has fallen below a level deemed acceptable.
    FMAC has continued to support the loan through servicer advances, but a restructuring of the loan is imminent. The loan restructuring is expected to be finalized by the end of June, at which time Fitch IBCA may take further rating action on some or all of the note classes.
    Fitch IBCA recently met with Midland's management team to discuss the loan restructuring and future operations of the company, and will incorporate information gained during the meeting in any future rating actions taken.