Fat Brands, Inc Material Event - What Happened

Hey there! Let's break down what's been going on with Fat Brands, Inc. (you know, the company behind places like Johnny Rockets, Great American Cookies, and Fatburger). Sometimes big news comes out that can be a bit confusing, so let's get to the bottom of it in plain English.

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1. What happened? (The actual event, no fancy words)

Basically, Fat Brands got a warning from Nasdaq, the stock exchange, because its stock price and market value have been too low, putting its listing at risk.

2. When did it happen?

This news was announced on January 8, 2026, when Fat Brands received official notices from Nasdaq.

3. Why did it happen? (The story behind the news)

So, why did Fat Brands get these warnings? Well, for a period between November 20, 2025, and January 7, 2026, the company's Class A Common Stock (traded as FAT) consistently traded below Nasdaq's required minimum bid price of $1.00 per share. On top of that, the total market value of its Class A shares fell below $35 million, and the market value of its publicly held Class B shares (FATBB) dropped below $1 million. These are all rules Nasdaq has to ensure companies listed on its exchange are of a certain size and stability. Think of it as like a school giving a student a warning for not meeting attendance or grade requirements.

4. Why does this matter? (The "so what?" for the company)

This is a big deal because if Fat Brands can't get its stock price and market values back up within a certain timeframe, its shares could be delisted from the Nasdaq stock exchange. While the notices don't have an immediate effect on trading, delisting would make it harder for investors to buy and sell the stock, and it could damage the company's reputation and ability to raise money in the future. It could create some headaches for management and potentially impact investor confidence.

5. Who is affected? (Beyond just the company)

A few different groups of people might feel the ripple effects of this:

• Employees: Usually, these kinds of stock market issues don't directly impact day-to-day operations or jobs, but a struggling stock price can sometimes affect employee morale or stock-based compensation.
• Customers: For customers enjoying a burger at Fatburger or a cookie from Great American Cookies, this news likely won't change their experience at all. It's more of a financial and administrative issue.
• Investors/Shareholders: This news can definitely make their stock price jump up or down, depending on whether people see it as good or bad news for the company's future. Investors in both Class A (FAT) and Class B (FATBB) common stock are directly affected, as their shares are the ones at risk of delisting. It creates uncertainty and potential liquidity issues.
• The Restaurant Industry: This is more of a company-specific financial issue rather than a broad industry trend. It highlights the challenges some companies face in maintaining stock market listing requirements.

6. What happens next? (The immediate future and beyond)

Right now, Fat Brands has a grace period of 180 calendar days, until July 7, 2026, to fix these issues. To regain compliance, their Class A Common Stock needs to close at $1.00 or more for at least ten consecutive business days, and its market value needs to be $35 million or more for ten consecutive business days. For Class B Common Stock, its market value of publicly held shares needs to be $1 million or more for ten consecutive business days.

Looking further down the road, we might see the company take steps to boost its stock price, perhaps through a reverse stock split (where they combine multiple shares into one to increase the price per share) or by improving their financial performance to attract more investors. Keep an eye out for any announcements from Fat Brands regarding their plans to regain compliance or their next earnings report, which might shed light on their financial health.

7. What should investors/traders know? (Your practical takeaways)

If you own Fat Brands stock, or you're thinking about buying or selling, here's the gist:

• Understand the "Why": Make sure you grasp why this event happened – it's about not meeting Nasdaq's minimum requirements for stock price and market value.
• Watch the Stock Price: This kind of news often puts downward pressure on a stock. Keep a close eye on how FAT and FATBB perform, especially as the July 7, 2026 deadline approaches.
• Long-Term vs. Short-Term: For day traders, this might create volatility. For long-term investors, you need to consider if the company can successfully regain compliance and what the implications are if it can't. Delisting could significantly impact the liquidity and value of your investment.
• Do Your Homework: Don't just react to the headlines. Look at the company's official press releases, read what financial analysts are saying, and consider if this aligns with your own investment goals. Specifically, research what a reverse stock split means if the company pursues that option.
• Risk vs. Reward: Every big event comes with both potential upsides and downsides. The risk here is potential delisting, which could make the stock harder to trade and potentially reduce its value. The reward would be if the company successfully regains compliance, which could stabilize the stock.

This is just a quick rundown to help you understand the basics. Always remember to do your own research before making any financial decisions!