OREANDA-NEWS. April 27, 2016. Fitch Ratings assigns a rating of 'A/F1' to the \\$14,810,000 Development Authority of Bartow County tax-exempt variable rate demand revenue bonds (VMC Speciality Alloys, LLC Project), series 2016. The Rating Outlook for the long-term rating is Negative.

KEY RATING DRIVERS
The rating is based on the support provided by an irrevocable direct-pay letter of credit (LOC) issued by Comerica Bank (rated 'A/F1', Negative Outlook), which has an initial stated expiration date of May 10, 2021, unless such date is extended or earlier terminated, while the bonds are in the weekly interest rate mode only.

The bank is obligated to make regularly scheduled payments of principal of and interest on the bonds in addition to payments due upon maturity, acceleration and redemption, as well as purchase price for tendered bonds. The LOC provides full and sufficient coverage of principal plus an amount equal to 39 days of interest at a maximum rate of 12% based on a year of 365 days and purchase price for tendered bonds, while in the weekly rate mode. The Remarketing Agent for the bonds is Zions Bank. The bonds are expected to be delivered on or about May 10, 2016.

The bonds initially bear interest at a weekly rate, but may be converted to a fixed rate. While bonds bear interest in the weekly rate mode, interest payments are on the first business day of each month, commencing June 1, 2016. The trustee is obligated to make timely draws on the LOC to pay principal, interest, and purchase price. Funds drawn under the LOC are held uninvested and are free from any lien prior to that of the bondholders.

Holders may tender their bonds on any business day, provided the trustee and remarketing agent are given the requisite prior notice of the purchase. The bonds are subject to mandatory tender: (1) upon conversion of the interest rate and (2) substitution or termination of the LOC. The bonds shall be subject to mandatory redemption following trustee's receipt of notice of an event of default under the Reimbursement Agreement or non-reinstatement of the LOC interest. The bank has the option of directing a purchase in lieu of redemption rather than a mandatory redemption upon an event of default under the Reimbursement Agreement or non-reinstatement of LOC interest. Optional and mandatory redemption provisions also apply to the bonds. Additional bonds may be issued provided they receive a separate series designation and trustee is prohibited from drawing on the LOC to make payment on them or the LOC is amended to support such additional bonds.

Bond proceeds will be used to finance, refinance or reimburse the Lessee for, the cost of acquisition and installation of certain equipment and the construction, restoration, improvement and renovation of the real property and improvement.

RATING SENSITIVITIES
The rating is exclusively tied to the short- and long-term rating that Fitch maintains on the bank providing the substitute LOC and will reflect all changes to that rating.