$22.485 MILLION IN DEBT AFFECTED, LETTER OF CREDIT PROVIDED BY WELLS FARGO BANK, N.A.
Expected Sale Date
DIRECT PAY LOC
NEW YORK, Sep 22, 2010 -- Moody's Investors Service has upgraded the long-term rating to Aa2 from Baa1 and
assigned a short-term rating of VMIG 1 to Converse County, Wyoming Pollution
control Revenue Refunding Bonds (PacifiCorp Project) Series 1992 (the Bonds) in
conjunction with the addition of a letter of credit scheduled to occur on
September 22, 2010.
Upon the addition of the letter of credit, the rating will be based upon (i) the
letter of credit (LOC) provided by Wells Fargo Bank, N.A. (the Bank), (ii) the
structural and legal protections of the transaction which ensures timely payment
of debt service and purchase price to bondholders, and, (iii) Moody's
evaluation of the credit quality of the Bank.
Moody's currently rates the Bank Aa2 for its long-term obligations and Prime-1
for its short-term obligations.
Interest Rate Modes and Payment
The Bonds will continue to bear interest at a weekly rate and pay interest on
the first business day of each month. The Bonds may be converted in whole to
bear interest at the daily, term or flexible rate modes and are subject to
mandatory tender at a price of par plus accrued interest upon conversion. The
initial rating will cover the Bonds in the daily and weekly rate modes and will
expire upon conversion to any other rate mode. While in the daily rate mode, the
Bonds will pay interest on the first business day of each month.
The indenture does not permit the issuance of additional bonds.
Flow of Funds
The trustee is instructed to draw under the LOC for principal or interest in
accordance with the LOC to pay principal and interest when due. The trustee is
instructed to draw under the LOC, on each purchase date, for purchase price, to
the extent remarketing proceeds are insufficient. Bonds which are purchased by
the Bank due to a failed remarketing are held by the trustee and will not be
released until the trustee has received confirmation from the Bank stating
that the LOC has been reinstated in the amount of the purchase price drawn for
Letter of Credit
The LOC is sized for full principal plus 48 days of interest at the maximum rate
applicable to the Bonds (12%) and will provide coverage for Bonds while they
bear interest in only the daily or weekly rate mode. The LOC is subject to the
Uniform Customs and Practice for Documentary Credits (2007 Revision),
Publication No. 600 of the ICC.
Draws on the Letter of Credit
Conforming draws for principal and/or interest presented to the Bank at or
before 3:00 p.m., Eastern Time (ET), on a business day, will be honored by the
Bank on or before 1:00 p.m. on the next business day. Conforming draws
for purchase price presented to the Bank at or before 12:00 p.m., ET, on a
business day, will be honored by the Bank on or before 2:30 p.m. on the same
Reinstatement of Interest Draws
Draws made under the LOC for interest shall be automatically reinstated on the
8th business day following the date such drawing is honored by the Bank unless
the trustee receives notice from the Bank no later than 7 business days
following said day indicating the LOC will not reinstate. Upon receipt thereof,
the trustee shall effect a mandatory tender of the Bonds on the business day
following receipt of such notice.
Reimbursement Agreement Defaults
The Bank has no Bond remedies as a result of an event of default under the
Indenture of Trust Events of Default Related to Payments
Upon a failure to pay when due and payable the principal, interest or purchase
price on the Bonds, the trustee shall declare an acceleration of the Bonds if
the Bank directs the trustee to accelerate the Bonds (interest shall cease to
accrue no later than 2 business days following such declaration).
Expiration/Termination of the Letter of Credit
The LOC shall terminate on September 22, 2011, unless extended.
The Bonds will be subject to mandatory tender on the business day preceding the
effective date of the substitute LOC. Draws for purchase price upon the
substitution of the LOC will be made under the existing LOC.
Bondholders may optionally tender their Bonds during (a) the daily rate mode on
any business day provided written notice is delivered to the trustee and
remarketing agent by 11:00 a.m., ET on the purchase date; (b) the weekly rate
mode on any business day with seven days prior written notice to the trustee.
The Bonds are subject to mandatory tender on the following dates: (1) the
interest conversion date; (2) on the business day preceding the expiration or
termination of the LOC; (3) on the business day preceding the substitution of
the LOC; and, (4) the business day following the trustee's receipt of notice
from the Bank indicating the LOC will not reinstate.
The Bonds are subject to mandatory redemption upon the occurrence of
a determination of taxability.
Last Rating Action
The last rating action on the Bonds occurred on March 31, 2005 when the rating
of Baa1/P-2 was assigned to the Bonds.
What Could Change the Rating-Up
Long-term: The long-term rating on the Bonds would be raised if the long-term
other senior obligation (OSO) rating on the Bank was upgraded.
Short-term: Not applicable.
What Could Change the Rating-Down
Long-term: The long-term rating on the Bonds would be lowered if the long-term
OSO rating on the Bank was downgraded.
Short-term: The short-term rating on the Bonds would be lowered if the
short-term OSO rating on the Bank was downgraded.
Trustee: The Bank of New York Mellon Trust Company
Remarketing Agent and Underwriter: JPMorgan Securities Inc.
The principal methodology used in rating this issue was Moody's Rating
Methodology for Leter of Credit Supported Transactions rating
methodology published in August 2005. Other methodologies and factors that may
have been considered in the process of rating this issue can also be found on
Information sources used to prepare the credit rating are the following: parties
involved in the ratings and public information
Moody's Investors Service considers the quality of information available on the
issuer or obligation satisfactory for the purposes of assigning a credit rating.
MOODY'S adopts all necessary measures so that the information it uses in assigning a credit rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when appropriate, independent third-party sources. However, MOODY'S is not an auditor and cannot in every instance independently verify or validate information received in the rating process.
Please see ratings tab on the issuer/entity page on Moodys.com for the last rating action and the rating history.
The date on which some Credit Ratings were first released goes back to a time before Moody's Investors Service's Credit Ratings were fully digitized and accurate data may not be available. Consequently, Moody's Investors Service provides a date that it believes is the most reliable and accurate based on the information that is available to it. Please see the ratings disclosure page on our website www.moodys.com for further information.
Please see the Credit Policy page on Moodys.com for the methodologies used in determining ratings, further information on the meaning of each rating category and the definition of default and recovery.
Public Finance Group
Moody's Investors Service
Senior Credit Officer
Public Finance Group
Moody's Investors Service
Journalists: (212) 553-0376
Research Clients: (212) 553-1653
MOODY'S UPGRADES TO Aa2 FROM Baa1 THE LONG-TERM LETTER OF CREDIT-BACKED RATING TO CONVERSE COUNTY, WYOMING POLLUTION CONTROL REVENUE REFUNDING BONDS (PACIFICORP PROJECT) SERIES 1992; ASSIGNS SHORT-TERM VMIG 1 RATING
Moody's Investors Service
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New York, NY 10007