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Acrisure, LLC -- Moody’s says Acrisure’s ratings remain unchanged following announcement of term loan add-on

·27 min read

<!DOCTYPE html> <html lang="" xml:lang=""> <head> <title>/nwsys/www/images/PR_1000004163</title> <meta http-equiv="Content-Type" content="text/html; charset=UTF-8"/> <meta name="generator" content="pdftohtml 0.36"/> <meta name="date" content="2021-01-25T18:30:19+00:00"/> <style type="text/css"> <!-- .xflip { -moz-transform: scaleX(-1); -webkit-transform: scaleX(-1); -o-transform: scaleX(-1); transform: scaleX(-1); filter: fliph; } .yflip { -moz-transform: scaleY(-1); -webkit-transform: scaleY(-1); -o-transform: scaleY(-1); transform: scaleY(-1); filter: flipv; } .xyflip { -moz-transform: scaleX(-1) scaleY(-1); -webkit-transform: scaleX(-1) scaleY(-1); -o-transform: scaleX(-1) scaleY(-1); transform: scaleX(-1) scaleY(-1); filter: fliph + flipv; } --> </style> </head> <body bgcolor="#A0A0A0" vlink="blue" link="blue"> <!-- Page 1 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;} .ft00{font-size:18px;font-family:Times;color:#000000;} .ft01{font-size:18px;font-family:Times;color:#1257c7;} .ft02{font-size:14px;font-family:Times;color:#666666;} .ft03{font-size:13px;font-family:Times;color:#000000;} .ft04{font-size:13px;font-family:Times;color:#0d0c0c;} .ft05{font-size:13px;line-height:31px;font-family:Times;color:#0d0c0c;} .ft06{font-size:13px;line-height:30px;font-family:Times;color:#0d0c0c;} --> </style> <div id="page1-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PR_1000004163001.png" alt="background image"/> <p style="position:absolute;top:163px;left:108px;white-space:nowrap" class="ft00"><b>Announcement:&#160;</b></p> <p style="position:absolute;top:163px;left:268px;white-space:nowrap" class="ft01"><b>Moody’s says Acrisure’s ratings remain unchanged</b></p> <p style="position:absolute;top:187px;left:108px;white-space:nowrap" class="ft01"><b>following announcement of term loan add-on</b></p> <p style="position:absolute;top:234px;left:108px;white-space:nowrap" class="ft02"><b>25 January 2021</b></p> <p style="position:absolute;top:261px;left:108px;white-space:nowrap" class="ft03"><b>Company adding $700 million to existing senior secured term loan, raising total outstanding term</b></p> <p style="position:absolute;top:279px;left:108px;white-space:nowrap" class="ft03"><b>loan to $3.9 billion</b></p> <p style="position:absolute;top:303px;left:108px;white-space:nowrap" class="ft04">New York, January 25, 2021 – Moody's Investors Service says the B3 corporate family rating and</p> <p style="position:absolute;top:323px;left:108px;white-space:nowrap" class="ft04">B3-PD probability of default rating on Acrisure, LLC (Acrisure) remain unchanged following the</p> <p style="position:absolute;top:342px;left:108px;white-space:nowrap" class="ft04">company’s announcement that it plans to borrow an additional $700 million under its senior secured</p> <p style="position:absolute;top:362px;left:108px;white-space:nowrap" class="ft04">term loan (rated B2). The company intends to use net proceeds from the offering to refinance</p> <p style="position:absolute;top:381px;left:108px;white-space:nowrap" class="ft04">existing secured debt, fund future acquisitions and pay related fees and expenses. The rating</p> <p style="position:absolute;top:401px;left:108px;white-space:nowrap" class="ft05">outlook for Acrisure is unchanged at stable.<br/>RATINGS RATIONALE<br/>Acrisure's ratings reflect its growing market presence in US insurance brokerage and select</p> <p style="position:absolute;top:482px;left:108px;white-space:nowrap" class="ft04">international markets, its good mix of business across property &amp; casualty insurance and employee</p> <p style="position:absolute;top:502px;left:108px;white-space:nowrap" class="ft04">benefits, and its healthy EBITDA margins. Acrisure maintains the existing brands of its many</p> <p style="position:absolute;top:521px;left:108px;white-space:nowrap" class="ft04">acquired entities and allows them to operate fairly autonomously, while centralizing critical financial</p> <p style="position:absolute;top:541px;left:108px;white-space:nowrap" class="ft04">reporting and compliance functions. Acrisure aligns the interests of its existing and acquired</p> <p style="position:absolute;top:560px;left:108px;white-space:nowrap" class="ft04">businesses by including significant common equity in its purchase consideration. While GSO/</p> <p style="position:absolute;top:580px;left:108px;white-space:nowrap" class="ft04">Blackstone holds a majority of Acrisure’s preferred equity, Acrisure Management and Agency</p> <p style="position:absolute;top:599px;left:108px;white-space:nowrap" class="ft06">Partners own more than 90% of the firm's common equity.<br/>These strengths are offset by Acrisure's large number and dollar volume of acquisitions and its rising</p> <p style="position:absolute;top:649px;left:108px;white-space:nowrap" class="ft04">debt burden. The acquisition strategy heightens the firm's integration risk and its exposure to errors</p> <p style="position:absolute;top:669px;left:108px;white-space:nowrap" class="ft04">and omissions in the delivery of professional services. The acquisitions also give rise to contingent</p> <p style="position:absolute;top:688px;left:108px;white-space:nowrap" class="ft06">earnout liabilities that consume a substantial portion of Acrisure's free cash flow.<br/>Acrisure’s performance is holding up relatively well through the coronavirus-related economic</p> <p style="position:absolute;top:738px;left:108px;white-space:nowrap" class="ft04">slowdown with revenues of $1.4 billion for the first nine months of 2020 and strong EBITDA margins</p> <p style="position:absolute;top:758px;left:108px;white-space:nowrap" class="ft04">helped by expense savings. The company’s organic growth was slightly negative for the first nine</p> <p style="position:absolute;top:777px;left:108px;white-space:nowrap" class="ft04">months of 2020 while retention rates remained solid. Moody’s expects that Acrisure will continue to</p> <p style="position:absolute;top:797px;left:108px;white-space:nowrap" class="ft06">limit its discretionary spending to maintain its credit profile as the economy recovers.<br/>Giving effect to the proposed borrowing, Acrisure will have a pro forma debt-to-EBITDA ratio at or</p> <p style="position:absolute;top:846px;left:108px;white-space:nowrap" class="ft04">slightly above 7.5x and (EBITDA - capex) interest coverage in the range of 1.5x-2x, per Moody's</p> <p style="position:absolute;top:866px;left:108px;white-space:nowrap" class="ft04">estimates. The company is improving its cash flow generation, and produced positive free cash flow</p> <p style="position:absolute;top:885px;left:108px;white-space:nowrap" class="ft04">after contingent earnout payments and scheduled debt amortization during the first nine months of</p> <p style="position:absolute;top:905px;left:108px;white-space:nowrap" class="ft04">2020. These metrics incorporate the rating agency's adjustments for operating leases, contingent</p> <p style="position:absolute;top:924px;left:108px;white-space:nowrap" class="ft04">earnout liabilities, changes in a warrant liability, and run-rate earnings from recent and pending</p> <p style="position:absolute;top:944px;left:108px;white-space:nowrap" class="ft04">acquisitions. Moody's expects Acrisure to reduce its financial leverage over the next couple of years</p> <p style="position:absolute;top:963px;left:108px;white-space:nowrap" class="ft04">in line with provisions it has agreed to with its preferred equity holders, and to continue generating</p> <p style="position:absolute;top:983px;left:108px;white-space:nowrap" class="ft04">positive free cash flow after earnout payments and debt amortization.</p> </div> <!-- Page 2 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;} .ft07{font-size:13px;font-family:Times;color:#1b62b7;} --> </style> <div id="page2-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PR_1000004163002.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft04">Factors that could lead to a rating upgrade include: (i) debt-to-EBITDA ratio below 6x; (ii) (EBITDA</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft04">- capex) coverage of interest exceeding 2x; (iii) free-cash-flow-to-debt ratio exceeding 5%; and (iv)</p> <p style="position:absolute;top:153px;left:108px;white-space:nowrap" class="ft06">declining proportion of revenue and earnings from newly acquired versus existing business.<br/>Factors that could lead to a rating downgrade include: (i) debt-to-EBITDA ratio above 7.5x; (ii)</p> <p style="position:absolute;top:202px;left:108px;white-space:nowrap" class="ft04">(EBITDA - capex) coverage of interest below 1.2x; (iii) free-cash-flow-to-debt ratio below 2%, or</p> <p style="position:absolute;top:222px;left:108px;white-space:nowrap" class="ft04">negative free cash flow after contingent earnout payments and scheduled debt amortization; or (iv)</p> <p style="position:absolute;top:241px;left:108px;white-space:nowrap" class="ft06">disruptions to existing or newly acquired operations.<br/>The following ratings remain unchanged:<br/>Corporate family rating at B3;<br/>Probability of default rating at B3-PD;<br/>$350 million senior secured revolving credit facility (undrawn) maturing in February 2025 at B2</p> <p style="position:absolute;top:382px;left:108px;white-space:nowrap" class="ft06">(LGD3);<br/>$3.9 billion (including pending $700 million increase) senior secured term loan maturing in February</p> <p style="position:absolute;top:432px;left:108px;white-space:nowrap" class="ft06">2027 at B2 (LGD3);<br/>$950 million senior secured notes maturing in February 2024 at B2 (LGD3);<br/>$925 million senior unsecured notes maturing in November 2025 at Caa2 (to LGD6 from LGD5);<br/>$400 million senior unsecured notes maturing in August 2026 at Caa2 (to LGD6 from LGD5).<br/>The rating outlook for Acrisure is unchanged at stable.<br/>The methodology used in these ratings was Insurance Brokers and Service Companies published</p> <p style="position:absolute;top:603px;left:108px;white-space:nowrap" class="ft04">in June 2018 and available at</p> <p style="position:absolute;top:603px;left:313px;white-space:nowrap" class="ft07">&#160;https://www.moodys.com/researchdocumentcontentpage.aspx?</p> <p style="position:absolute;top:622px;left:108px;white-space:nowrap" class="ft07">docid=PBC_1121967.</p> <p style="position:absolute;top:622px;left:260px;white-space:nowrap" class="ft04">&#160;Alternatively, please see the Rating Methodologies page on www.moodys.com</p> <p style="position:absolute;top:642px;left:108px;white-space:nowrap" class="ft06">for a copy of this methodology.<br/>Based in Grand Rapids, Michigan, Acrisure distributes a range of property &amp; casualty insurance,</p> <p style="position:absolute;top:692px;left:108px;white-space:nowrap" class="ft04">employee benefits and related products to small and midsize businesses through offices in a</p> <p style="position:absolute;top:711px;left:108px;white-space:nowrap" class="ft04">majority of US states and through operations in the UK, Switzerland and Bermuda. The company</p> <p style="position:absolute;top:731px;left:108px;white-space:nowrap" class="ft06">generated revenue of $2 billion for the 12 months through September 2020.<br/>Please see www.moodys.com for any updates on changes to the lead rating analyst and to the</p> <p style="position:absolute;top:780px;left:108px;white-space:nowrap" class="ft06">Moody's legal entity that has issued the rating.<br/>This publication does not announce a credit rating action. For any credit ratings referenced in this</p> <p style="position:absolute;top:830px;left:108px;white-space:nowrap" class="ft04">publication, please see the ratings tab on the issuer/entity page on www.moodys.com for the most</p> <p style="position:absolute;top:850px;left:108px;white-space:nowrap" class="ft06">updated credit rating action information and rating history.<br/>Chris Scott</p> <p style="position:absolute;top:900px;left:108px;white-space:nowrap" class="ft04">AVP-Analyst</p> <p style="position:absolute;top:919px;left:108px;white-space:nowrap" class="ft04">Financial Institutions Group</p> <p style="position:absolute;top:939px;left:108px;white-space:nowrap" class="ft04">Moody's Investors Service, Inc.</p> <p style="position:absolute;top:958px;left:108px;white-space:nowrap" class="ft04">250 Greenwich Street</p> <p style="position:absolute;top:978px;left:108px;white-space:nowrap" class="ft04">New York, NY 10007</p> <p style="position:absolute;top:997px;left:108px;white-space:nowrap" class="ft04">U.S.A.</p> <p style="position:absolute;top:1017px;left:108px;white-space:nowrap" class="ft04">JOURNALISTS: 1 <PhoneNo>212 553 0376</PhoneNo></p> <p style="position:absolute;top:1036px;left:108px;white-space:nowrap" class="ft04">Client Service: 1 <PhoneNo>212 553 1653</PhoneNo></p> </div> <!-- Page 3 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;} .ft08{font-size:13px;font-family:Times;color:#0d0c0c;} .ft09{font-size:13px;line-height:22px;font-family:Times;color:#0d0c0c;} .ft010{font-size:13px;line-height:23px;font-family:Times;color:#0d0c0c;} --> </style> <div id="page3-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PR_1000004163003.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft04">Sarah Hibler</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft04">Associate Managing Director</p> <p style="position:absolute;top:153px;left:108px;white-space:nowrap" class="ft04">Financial Institutions Group</p> <p style="position:absolute;top:172px;left:108px;white-space:nowrap" class="ft04">JOURNALISTS: 1 <PhoneNo>212 553 0376</PhoneNo></p> <p style="position:absolute;top:192px;left:108px;white-space:nowrap" class="ft06">Client Service: 1 <PhoneNo>212 553 1653</PhoneNo><br/>Releasing Office:</p> <p style="position:absolute;top:241px;left:108px;white-space:nowrap" class="ft04">Moody's Investors Service, Inc.</p> <p style="position:absolute;top:261px;left:108px;white-space:nowrap" class="ft04">250 Greenwich Street</p> <p style="position:absolute;top:280px;left:108px;white-space:nowrap" class="ft04">New York, NY 10007</p> <p style="position:absolute;top:300px;left:108px;white-space:nowrap" class="ft04">U.S.A.</p> <p style="position:absolute;top:319px;left:108px;white-space:nowrap" class="ft04">JOURNALISTS: 1 <PhoneNo>212 553 0376</PhoneNo></p> <p style="position:absolute;top:339px;left:108px;white-space:nowrap" class="ft04">Client Service: 1 <PhoneNo>212 553 1653</PhoneNo></p> <p style="position:absolute;top:435px;left:108px;white-space:nowrap" class="ft04">© 2021 Moody’s Corporation, Moody’s Investors Service, Inc., Moody’s Analytics, Inc. and/or their</p> <p style="position:absolute;top:455px;left:108px;white-space:nowrap" class="ft09">licensors and affiliates (collectively, “MOODY’S”). 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IF IN DOUBT YOU SHOULD CONTACT YOUR FINANCIAL OR OTHER</p> <p style="position:absolute;top:153px;left:108px;white-space:nowrap" class="ft011">PROFESSIONAL ADVISER.<br/>ALL INFORMATION CONTAINED HEREIN IS PROTECTED BY LAW, INCLUDING BUT NOT</p> <p style="position:absolute;top:195px;left:108px;white-space:nowrap" class="ft04">LIMITED TO, COPYRIGHT LAW, AND NONE OF SUCH INFORMATION MAY BE COPIED OR</p> <p style="position:absolute;top:215px;left:108px;white-space:nowrap" class="ft04">OTHERWISE REPRODUCED, REPACKAGED, FURTHER TRANSMITTED, TRANSFERRED,</p> <p style="position:absolute;top:234px;left:108px;white-space:nowrap" class="ft04">DISSEMINATED, REDISTRIBUTED OR RESOLD, OR STORED FOR SUBSEQUENT USE FOR</p> <p style="position:absolute;top:254px;left:108px;white-space:nowrap" class="ft04">ANY SUCH PURPOSE, IN WHOLE OR IN PART, IN ANY FORM OR MANNER OR BY ANY</p> <p style="position:absolute;top:273px;left:108px;white-space:nowrap" class="ft011">MEANS WHATSOEVER, BY ANY PERSON WITHOUT MOODY’S PRIOR WRITTEN CONSENT.<br/>MOODY’S CREDIT RATINGS, ASSESSMENTS, OTHER OPINIONS AND PUBLICATIONS ARE</p> <p style="position:absolute;top:316px;left:108px;white-space:nowrap" class="ft04">NOT INTENDED FOR USE BY ANY PERSON AS A BENCHMARK AS THAT TERM IS DEFINED</p> <p style="position:absolute;top:335px;left:108px;white-space:nowrap" class="ft04">FOR REGULATORY PURPOSES AND MUST NOT BE USED IN ANY WAY THAT COULD RESULT</p> <p style="position:absolute;top:355px;left:108px;white-space:nowrap" class="ft011">IN THEM BEING CONSIDERED A BENCHMARK.<br/>All information contained herein is obtained by MOODY’S from sources believed by it to be</p> <p style="position:absolute;top:397px;left:108px;white-space:nowrap" class="ft04">accurate and reliable. Because of the possibility of human or mechanical error as well as other</p> <p style="position:absolute;top:417px;left:108px;white-space:nowrap" class="ft04">factors, however, all information contained herein is provided “AS IS” without warranty of any kind.</p> <p style="position:absolute;top:436px;left:108px;white-space:nowrap" class="ft04">MOODY'S adopts all necessary measures so that the information it uses in assigning a credit</p> <p style="position:absolute;top:456px;left:108px;white-space:nowrap" class="ft04">rating is of sufficient quality and from sources MOODY'S considers to be reliable including, when</p> <p style="position:absolute;top:475px;left:108px;white-space:nowrap" class="ft04">appropriate, independent third-party sources. However, MOODY’S is not an auditor and cannot</p> <p style="position:absolute;top:495px;left:108px;white-space:nowrap" class="ft04">in every instance independently verify or validate information received in the rating process or in</p> <p style="position:absolute;top:514px;left:108px;white-space:nowrap" class="ft011">preparing its Publications.<br/>To the extent permitted by law, MOODY’S and its directors, officers, employees, agents,</p> <p style="position:absolute;top:557px;left:108px;white-space:nowrap" class="ft04">representatives, licensors and suppliers disclaim liability to any person or entity for any indirect,</p> <p style="position:absolute;top:576px;left:108px;white-space:nowrap" class="ft04">special, consequential, or incidental losses or damages whatsoever arising from or in connection</p> <p style="position:absolute;top:596px;left:108px;white-space:nowrap" class="ft04">with the information contained herein or the use of or inability to use any such information, even if</p> <p style="position:absolute;top:615px;left:108px;white-space:nowrap" class="ft04">MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers</p> <p style="position:absolute;top:635px;left:108px;white-space:nowrap" class="ft04">is advised in advance of the possibility of such losses or damages, including but not limited to:</p> <p style="position:absolute;top:654px;left:108px;white-space:nowrap" class="ft04">(a) any loss of present or prospective profits or (b) any loss or damage arising where the relevant</p> <p style="position:absolute;top:674px;left:108px;white-space:nowrap" class="ft011">financial instrument is not the subject of a particular credit rating assigned by MOODY’S.<br/>To the extent permitted by law, MOODY’S and its directors, officers, employees, agents,</p> <p style="position:absolute;top:716px;left:108px;white-space:nowrap" class="ft04">representatives, licensors and suppliers disclaim liability for any direct or compensatory losses</p> <p style="position:absolute;top:736px;left:108px;white-space:nowrap" class="ft04">or damages caused to any person or entity, including but not limited to by any negligence (but</p> <p style="position:absolute;top:755px;left:108px;white-space:nowrap" class="ft04">excluding fraud, willful misconduct or any other type of liability that, for the avoidance of doubt,</p> <p style="position:absolute;top:775px;left:108px;white-space:nowrap" class="ft04">by law cannot be excluded) on the part of, or any contingency within or beyond the control of,</p> <p style="position:absolute;top:794px;left:108px;white-space:nowrap" class="ft04">MOODY’S or any of its directors, officers, employees, agents, representatives, licensors or suppliers,</p> <p style="position:absolute;top:814px;left:108px;white-space:nowrap" class="ft04">arising from or in connection with the information contained herein or the use of or inability to use</p> <p style="position:absolute;top:833px;left:108px;white-space:nowrap" class="ft011">any such information.<br/>NO WARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS,</p> <p style="position:absolute;top:876px;left:108px;white-space:nowrap" class="ft04">COMPLETENESS, MERCHANTABILITY OR FITNESS FOR ANY PARTICULAR PURPOSE OF</p> <p style="position:absolute;top:895px;left:108px;white-space:nowrap" class="ft04">ANY CREDIT RATING, ASSESSMENT, OTHER OPINION OR INFORMATION IS GIVEN OR MADE</p> <p style="position:absolute;top:915px;left:108px;white-space:nowrap" class="ft011">BY MOODY’S IN ANY FORM OR MANNER WHATSOEVER.<br/>Moody’s Investors Service, Inc., a wholly-owned credit rating agency subsidiary of Moody’s</p> <p style="position:absolute;top:957px;left:108px;white-space:nowrap" class="ft04">Corporation (“MCO”), hereby discloses that most issuers of debt securities (including corporate and</p> <p style="position:absolute;top:977px;left:108px;white-space:nowrap" class="ft04">municipal bonds, debentures, notes and commercial paper) and preferred stock rated by Moody’s</p> <p style="position:absolute;top:996px;left:108px;white-space:nowrap" class="ft04">Investors Service, Inc. have, prior to assignment of any credit rating, agreed to pay to Moody’s</p> <p style="position:absolute;top:1016px;left:108px;white-space:nowrap" class="ft04">Investors Service, Inc. for credit ratings opinions and services rendered by it fees ranging from</p> <p style="position:absolute;top:1035px;left:108px;white-space:nowrap" class="ft04">$1,000 to approximately $5,000,000. MCO and Moody’s Investors Service also maintain policies</p> </div> <!-- Page 5 --> <style type="text/css"> <!-- p {margin: 0; padding: 0;}--> </style> <div id="page5-div" style="position:relative;width:918px;height:1188px;"> <img width="918" height="1188" src="http://mco.acquiremedia.com/images/PR_1000004163005.png" alt="background image"/> <p style="position:absolute;top:114px;left:108px;white-space:nowrap" class="ft04">and procedures to address the independence of Moody’s Investors Service credit ratings and credit</p> <p style="position:absolute;top:133px;left:108px;white-space:nowrap" class="ft04">rating processes. Information regarding certain affiliations that may exist between directors of MCO</p> <p style="position:absolute;top:153px;left:108px;white-space:nowrap" class="ft04">and rated entities, and between entities who hold credit ratings from Moody’s Investors Service and</p> <p style="position:absolute;top:172px;left:108px;white-space:nowrap" class="ft04">have also publicly reported to the SEC an ownership interest in MCO of more than 5%, is posted</p> <p style="position:absolute;top:192px;left:108px;white-space:nowrap" class="ft04">annually at&#160;</p> <p style="position:absolute;top:192px;left:188px;white-space:nowrap" class="ft07">www.moodys.com</p> <p style="position:absolute;top:192px;left:315px;white-space:nowrap" class="ft04">&#160;under the heading “Investor Relations — Corporate Governance —</p> <p style="position:absolute;top:211px;left:108px;white-space:nowrap" class="ft011">Director and Shareholder Affiliation Policy.”<br/>Additional terms for Australia only: Any publication into Australia of this document is pursuant to the</p> <p style="position:absolute;top:254px;left:108px;white-space:nowrap" class="ft04">Australian Financial Services License of MOODY’S affiliate, Moody’s Investors Service Pty Limited</p> <p style="position:absolute;top:273px;left:108px;white-space:nowrap" class="ft04">ABN 61 003 399 657AFSL 336969 and/or Moody’s Analytics Australia Pty Ltd ABN 94 105 136</p> <p style="position:absolute;top:293px;left:108px;white-space:nowrap" class="ft04">972 AFSL 383569 (as applicable). This document is intended to be provided only to “wholesale</p> <p style="position:absolute;top:312px;left:108px;white-space:nowrap" class="ft04">clients” within the meaning of section 761G of the Corporations Act 2001. By continuing to access</p> <p style="position:absolute;top:332px;left:108px;white-space:nowrap" class="ft04">this document from within Australia, you represent to MOODY’S that you are, or are accessing</p> <p style="position:absolute;top:351px;left:108px;white-space:nowrap" class="ft04">the document as a representative of, a “wholesale client” and that neither you nor the entity you</p> <p style="position:absolute;top:371px;left:108px;white-space:nowrap" class="ft04">represent will directly or indirectly disseminate this document or its contents to “retail clients” within</p> <p style="position:absolute;top:390px;left:108px;white-space:nowrap" class="ft04">the meaning of section 761G of the Corporations Act 2001. MOODY’S credit rating is an opinion as</p> <p style="position:absolute;top:410px;left:108px;white-space:nowrap" class="ft04">to the creditworthiness of a debt obligation of the issuer, not on the equity securities of the issuer or</p> <p style="position:absolute;top:429px;left:108px;white-space:nowrap" class="ft011">any form of security that is available to retail investors.<br/>Additional terms for Japan only: Moody's Japan K.K. (“MJKK”) is a wholly-owned credit rating agency</p> <p style="position:absolute;top:472px;left:108px;white-space:nowrap" class="ft04">subsidiary of Moody's Group Japan G.K., which is wholly-owned by Moody’s Overseas Holdings Inc.,</p> <p style="position:absolute;top:491px;left:108px;white-space:nowrap" class="ft04">a wholly-owned subsidiary of MCO. Moody’s SF Japan K.K. (“MSFJ”) is a wholly-owned credit rating</p> <p style="position:absolute;top:511px;left:108px;white-space:nowrap" class="ft04">agency subsidiary of MJKK. MSFJ is not a Nationally Recognized Statistical Rating Organization</p> <p style="position:absolute;top:530px;left:108px;white-space:nowrap" class="ft04">(“NRSRO”). Therefore, credit ratings assigned by MSFJ are Non-NRSRO Credit Ratings. Non-</p> <p style="position:absolute;top:550px;left:108px;white-space:nowrap" class="ft04">NRSRO Credit Ratings are assigned by an entity that is not a NRSRO and, consequently, the rated</p> <p style="position:absolute;top:569px;left:108px;white-space:nowrap" class="ft04">obligation will not qualify for certain types of treatment under U.S. laws. MJKK and MSFJ are credit</p> <p style="position:absolute;top:589px;left:108px;white-space:nowrap" class="ft04">rating agencies registered with the Japan Financial Services Agency and their registration numbers</p> <p style="position:absolute;top:608px;left:108px;white-space:nowrap" class="ft011">are FSA Commissioner (Ratings) No. 2 and 3 respectively.<br/>MJKK or MSFJ (as applicable) hereby disclose that most issuers of debt securities (including</p> <p style="position:absolute;top:651px;left:108px;white-space:nowrap" class="ft04">corporate and municipal bonds, debentures, notes and commercial paper) and preferred stock rated</p> <p style="position:absolute;top:670px;left:108px;white-space:nowrap" class="ft04">by MJKK or MSFJ (as applicable) have, prior to assignment of any credit rating, agreed to pay to</p> <p style="position:absolute;top:690px;left:108px;white-space:nowrap" class="ft04">MJKK or MSFJ (as applicable) for credit ratings opinions and services rendered by it fees ranging</p> <p style="position:absolute;top:709px;left:108px;white-space:nowrap" class="ft011">from JPY125,000 to approximately JPY550,000,000.<br/>MJKK and MSFJ also maintain policies and procedures to address Japanese regulatory</p> <p style="position:absolute;top:752px;left:108px;white-space:nowrap" class="ft04">requirements.</p> </div> </body> </html>