Fitch to Affirm 'A/F1' Rating For CA Enterprise Dev Auth (Ramar Int'l Corp) VRDBs Ser 2008A
OREANDA-NEWS. On the effective date of Jan. 29, 2016, Fitch Ratings will affirm the 'A/F1' rating assigned to the California Enterprise Development Authority tax-exempt variable rate demand industrial development revenue bonds, (Ramar International Corporation Project), series 2008A. The Rating Outlook for the long-term rating is Stable. The rating action is in connection with: (i) the substitution of the irrevocable direct-pay letter of credit (LOC) previously provided by Bank of the West (rated 'A/F1', Stable Outlook) with a substitute LOC to be issued by Comerica Bank (rated 'A/F1', Stable Outlook); and (ii) the mandatory tender of the bonds, which will occur on Jan. 29, 2015.
KEY RATING DRIVERS
On the effective date, the rating will be based on the support provided by the substitute LOC issued by Comerica Bank, which has an initial stated expiration date of Jan. 29, 2021, unless such date is extended or earlier terminated, while the bonds are in the weekly interest rate mode only.
Pursuant to the substitute LOC, 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 Comerica Bank LOC provides full and sufficient coverage of principal plus an amount equal to 45 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 Gates Capital Corporation.
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.
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