Fitch Rtes $3.61MM Calif. Infra & Econ Dev Bank (Hillview Mental Hlth CTR) 2008A&B VRDBs 'A+/F1'

NEW YORK--(BUSINESS WIRE)--Fitch Ratings assigns an 'A+/F1' to the $3,610,000 California Infrastructure and Economic Development Bank variable rate demand revenue bonds (VRDBs), consisting of:

--$3,010,000 tax-exempt VRDBs (Hillview Mental Health Center, Inc. Project), series 2008A;

--$600,000 taxable VRDBs (Hillview Mental Health Center, Inc. Project), series 2008B.

The rating is based on the support provided by an irrevocable, direct-pay letter of credit (LOC) issued by Comerica Bank, securing the bonds. The bank is obligated to make payments of principal and interest when due, as well as purchase price for tendered bonds. The rating will expire upon the earliest of: the stated expiration date of the LOC, Aug. 1, 2013, unless such date is extended; any prior termination of the LOC; and defeasance of the bonds. The LOC provides full coverage of principal plus an amount equal to 45 days' interest at a maximum rate of 12% based on a 365-day year. The remarketing agent for the bonds is Gates Capital Corporation. The bonds are expected to be delivered on or about Aug. 14, 2008.

The bonds initially bear interest at the weekly rate mode, but may be converted to a fixed interest rate mode. While bonds bear interest in the weekly rate mode, interest payments are made on the first business day of each month, commencing Sept. 2, 2008. During the weekly rate, bondholders may tender their bonds on any business day, provided the trustee is given seven days' prior notice of the purchase. The bonds are subject to mandatory tender upon substitution of the LOC and upon conversion of the interest rate mode. The bonds are subject to mandatory redemption upon expiration of the LOC, and upon an event of default under the reimbursement agreement and upon notice of non-reinstatement of the interest under the LOC. Other optional ands mandatory redemption provisions also apply to the bonds.

The bond proceeds will be used to refinance the existing debt incurred by the borrower in connection with the acquisition, construction, installation, equipping and furnishing of and administrative and treatment facility for the borrower located in Pacoima, California.

Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, 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.