OREANDA-NEWS. June 16, 2015. Fitch Ratings assigns an 'AAA' rating to the following series of senior secured notes (the Notes) and an 'AA' rating to the following series of mandatory redeemable preferred shares (MRPS) issued by ClearBridge Energy MLP Fund Inc. (NYSE: CEM), a non-diversified, closed-end fund advised by Legg Mason Partners Fund Advisor, LLC (LMPFA) and sub-advised by ClearBridge Investments, LLC.:

Notes rated 'AAA':
--Series H Senior Secured Notes due June 11, 2021 in an amount up to \\$15,000,000;
--Series I Senior Secured Notes due June 11, 2025 in an amount up to \\$25,000,000;
--Series J Senior Secured Notes due June 11, 2027 in an amount up to \\$25,000,000;
--Series K Senior Secured Notes due June 11, 2030 in an amount up to \\$35,000,000.

MRPS rated 'AA':
--Series C Mandatory Redeemable Preferred Shares in an amount up to \\$21,000,000;
--Series D Mandatory Redeemable Preferred Shares in an amount up to \\$58,000,000;
--Series E Mandatory Redeemable Preferred Shares in an amount up to \\$19,000,000;
--Series F Mandatory Redeemable Preferred Shares in an amount up to \\$30,000,000;
--Series G Mandatory Redeemable Preferred Shares in an amount up to \\$30,000,000.

The proceeds of the note issuance will partially be used to fully pay off Series A Senior Secured Notes due July 12, 2015. Fitch marks this series Paid In Full.

Fitch also affirms ratings on the fund's existing Notes and MRPSs as listed at the bottom of this press release.

KEY RATING DRIVERS
The rating assignments and affirmations reflect:

--Sufficient pro forma asset coverage provided to the Notes as calculated per the fund's asset coverage tests;
--The structural protections afforded by mandatory collateral maintenance and de-leveraging provisions in the event of asset coverage declines;
--The legal and regulatory parameters that govern the fund's operations;
--The capabilities of Clearbridge Investments, LLC as investment advisor.

FUND PROFILE
The fund commenced its operations on June 25, 2010. The fund's objective is to provide a high level of total return with an emphasis on cash distributions. The fund seeks to achieve its objective by investing primarily in master limited partnerships (MLPs) in the energy sector, which are entities that derive at least 50% of their revenues from the business of exploring, developing, producing, gathering, transporting, processing, storing, refining, distributing, mining or marketing natural gas, natural gas liquids (including propane), crude oil, refined petroleum products or coal.

FUND LEVERAGE
The fund's pro forma total net assets incorporating this issuance were approximately \\$3,425 million and total leverage was \\$807 million. The leverage consisted of \\$517 million in Notes, \\$90 million drawn on the fund's credit facility and \\$200 million in MRPS. The notes and credit facility are both secured and rank pari passu in the fund's capital structure.

The fund carries a deferred tax liability (DTL) as a result of certain unrealized gains typically seen in MLP closed-end funds for tax purposes. To account for any residual risk dealing with the recognition of those gains upon sale, Fitch's rating criteria reduces the numerator of the Fitch total and net overcollateralization tests (Fitch OC tests) by 10% of the DTL. The 10% figure gives credit to the likely event that much of the currently existing unrealized gains would likely be eliminated or significantly reduced as a result of asset price declines in a stressed market scenario.

ASSET COVERAGE
The fund's pro forma asset coverage ratios for the Notes, as calculated in accordance with the Fitch OC tests per the 'AAA' rating guidelines outlined in Fitch's closed-end fund criteria, were in excess of 100%. This is the minimum asset coverage guideline required by the fund's governing documents.

The fund's pro forma asset coverage ratios for the Notes, as calculated in accordance with the Investment Company Act of 1940 (1940 Act), were in excess of 300%, which is the minimum asset coverage required by the 1940 Act at the time of issuance and the fund's governing documents.

STRUCTURAL PROTECTIONS
Should the asset coverage tests decline below their minimum threshold amounts (as tested on the last business day of each week), under the terms of the notes the fund is required to deliver notice to the Note purchasers within five business days. The fund manager is then expected to cure the breach by altering the composition of the portfolio toward assets with lower discount factors (for Fitch OC Tests breaches), or by reducing leverage in a sufficient amount (for both the Fitch OC Tests and the 1940 Act test breaches) within a pre-specified time period (a maximum of 47 calendar days for the Fitch OC Tests and a longer period for the 1940 Act test).

Failure to cure an asset coverage breach as described above is an Event of Default under the terms of the Notes. The fund must then deliver a notice within five business days to the note purchasers and a majority vote of note purchasers may then declare all the notes then outstanding to be immediately due and payable.

The fund is also prohibited from paying out a common stock dividend if it fails to cure a breach to the notes' 300% 1940 Act asset coverage test. Fitch views this as an added incentive to cure and deleverage in a timely manner, regardless of acceleration by the Notes purchasers.

PARI PASSU CLAIM WITH CREDIT FACILITY
Upon the occurrence of an Event of Default per the Note Purchase Agreement (such as a failure to cure an asset coverage breach) or per the fund's Credit Agreement, the noteholders and the bank lender will share in their claim on fund assets pari passu when receiving payments per the waterfall schedule described in the fund's intercreditor agreement. The fund accounts for this pari passu status in their calculation of the Fitch OC Tests.

THE ADVISOR
LMPFA and ClearBridge are wholly owned subsidiaries of Legg Mason, Inc., a global asset management firm with \\$707 billion in assets under management as of April 30, 2015. ClearBridge is Legg Mason, Inc.'s largest equity manager.

CONCURRENT RATING AFFIRMATIONS
Fitch affirms the following ratings at 'AAA':
--\\$50,000,000 Series B Senior Secured Notes due July 12, 2019;
--\\$102,000,000 Series C Senior Secured Notes due July 12, 2022;
--\\$90,000,000 Series D Senior Secured Notes due July 12, 2024;
--\\$50,000,000 Series A Senior Secured Notes due June 6, 2023;
--\\$50,000,000 Series B Senior Secured Notes due June 6, 2025;
--\\$75,000,000 Series A Senior Secured Notes due April 30, 2026.

Fitch affirms the following ratings at 'AA':
--\\$19,000,000 Series A MRPS, due Jan. 8, 2021;
--\\$23,000,000 Series B MRPS, due Jan. 8, 2023.

RATING SENSITIVITIES
The rating is based on the terms of the Notes stipulating mandatory collateral maintenance and de-leveraging provisions in the event of asset coverage declines. Should the fund fail to cure an asset coverage breach, or the note purchasers not declare the Notes due and payable upon an event of default due to an asset coverage breach, this may lengthen exposure to market value risk and cause the ratings to be lowered by Fitch.

The ratings may also be sensitive to material changes in the credit quality or market risk profile of the fund. A material adverse deviation from Fitch guidelines for any key rating driver could cause the ratings to be lowered by Fitch.