Fitch Confirms 'F1+' S-T Rating on Mecklenburg County, North Carolina's GOs Series 2006A

• Press Release
• Source: Fitch Ratings
• On 3:18 pm EST, Tuesday November 3, 2009

NEW YORK--(BUSINESS WIRE)--Effective Nov. 5, 2009, Fitch Ratings will confirm the short-term rating of 'F1+' assigned to the $89,000,000 County of Mecklenburg, North Carolina variable-rate general obligation bonds, series 2006A ($75,650,000 currently outstanding). The long-term 'AAA' rating assigned to the bonds continues to be based on the rating assigned to general obligations of Mecklenburg County.

The confirmation is in connection with the conversion of the bonds from a long-term interest rate mode to a weekly rate mode. While in the long-term interest rate mode the short-term 'F1+' rating was based on Fitch's assessment of the county's own liquidity. On Nov. 5, 2009, the short-term rating of 'F1+' will be confirmed based on the support of a standby bond purchase agreement (SBPA), provided by Wachovia Bank, N.A, (rated 'AA-/F1+' by Fitch) which will become effective on that date. A mandatory tender of the bonds will also occur on Nov. 5, 2009 and the bonds will be remarketed in a weekly rate mode.

The SBPA provides for the payment of the purchase price of tendered bonds bearing interest in the weekly rate mode in the event the proceeds of a remarketing of the bonds, following an optional or mandatory tender, are insufficient to pay the purchase price. The SBPA is sized to provide for the entire principal amount of the bonds, plus interest coverage of 35 days calculated at a maximum interest rate of 12%, based on a year of 365 days. The SBPA will expire on Nov. 5, 2012, the stated expiration date of the SBPA unless such date is extended, or upon the occurrence of other events of termination, all in accordance with its terms. Fitch's short-term rating expires upon the expiration or termination of the SBPA or defeasance of the bonds. Wells Fargo Securities is the remarketing agent for the bonds.

The long-term 'AAA' GO rating reflects the strength of the county's broad and expanding economy as well as its strong financial performance and management. The rating also incorporates debt ratios considered high for the rating category, attributable to a sustained aggressive borrowing program to fund significant capital needs coupled with the overlapping debt of the city of Charlotte, NC.

Additional information is available at www.fitchratings.com.

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Fitch Ratings, New York
Linda E. Friedman, +1-212-908-0727 (short-term rating)
Barbara Ruth Rosenberg, +1-212-908-0731 (Mecklenburg County)
or
Cindy Stoller, +1-212-908-0526 (Media Relations)
cindy.stoller@fitchratings.com