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Fitch Rates NJEDA 2003B Special Facility Revs Port Newark Container Terminal LLC Project 'A-/F1'

2012 JUN 10 (VerticalNews) -- By a News Reporter-Staff News Editor at Insurance Business Weekly -- Fitch Ratings assigns a rating of 'A-/F1', Negative Outlook to the $62,500,000 New Jersey Economic Development Authority special facility revenue bonds (Port Newark Container Terminal LLC Project), series 2003B. The rating is based on the support provided by an irrevocable direct-pay letter of credit (LOC) issued by Sovereign Bank, N.A. (rated 'A-/F1', Negative Outlook) supporting the bonds.

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 ratings will expire upon the earliest of: (a) May 23, 2013, the stated expiration date of the LOC, unless such date is extended; (b) conversion to a rate mode other than the daily or weekly rate mode; © any prior termination of the LOC; and (d) defeasance of the bonds. The LOC provides full and sufficient coverage of principal plus an amount equal to 46 days of interest at a maximum rate of 12% based on a year of 365 or 366 days and purchase price for tendered bonds while in the daily and weekly rate modes. The Remarketing Agent for the bonds is Citigroup Global Markets Inc.

The bonds bear interest at the weekly rate, but may be converted to a daily, short-term or long-term rate. While bonds bear interest in the weekly rate mode, interest payments are on the first Wednesday of each month. The Trustee is obligated to make timely draws on the LOC to pay principal, interest, and purchase price. Funds drawn under the LOC are held uninvested, and are free from any lien prior to that of the bondholders.

Holders may tender their bonds on any business day, provided the Tender Agent and Remarketing Agent are given the requisite prior notice of the purchase. The bonds are subject to mandatory tender: (1) upon conversion of the interest rate; (2) upon reduction, expiration, substitution or termination of the LOC; and (3) following receipt of written notice from the bank of an event of default under the Letter of Credit and Reimbursement Agreement. The bonds shall be accelerated following the Trustee's receipt of notice from the bank of non-reinstatement of the LOC interest component. Optional and mandatory redemption provisions apply to the bonds. Additional bonds may be issued provided they are issued under a supplemental indenture and the Trustee is prohibited from drawing on the LOC to make payment on bonds other than the Series 2003B bonds.

The bonds were issued to finance the construction of certain improvements which have been completed or will be undertaken by Port Newark Container Terminal L.L.C. at the Port Newark Container Terminal.

Additional information is available at www.fitchratings.com. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.

Applicable Criteria and Related Research:--'U.S. Municipal Structured Finance Rating Criteria', Feb. 28, 2012;--'Rating Guidelines for Letter of Credit-Supported Bonds', July 26, 2011.

Applicable Criteria and Related Research:U.S. Municipal Structured Finance Criteriahttp://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=672570Rating Guidelines for Letter of Credit-Supported Bondshttp://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=647311 ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE WWW.FITCHRATINGS.COM. PUBLISHED RATINGS, CRITERIA AND METHODOLOGIES ARE AVAILABLE FROM THIS SITE AT ALL TIMES. FITCH'S CODE OF CONDUCT, CONFIDENTIALITY, CONFLICTS OF INTEREST, AFFILIATE FIREWALL, COMPLIANCE AND OTHER RELEVANT POLICIES AND PROCEDURES ARE ALSO AVAILABLE FROM THE 'CODE OF CONDUCT' SECTION OF THIS SITE.

Keywords for this news article include: Fitch Ratings, Economic Development.