Fitch Rates Oregon Facilities Auth (Peace Health) 2008 Ser A&B 'AA-/F1+'; 2008 Ser C&D 'AA/F1+'

NEW YORK--(BUSINESS WIRE)--Fitch Ratings has assigned the following ratings to $194,670,000 Oregon Facilities Authority revenue bonds (PeaceHealth):

--$95,495,000 2008 series A 'AA-/F1+';

--$99,175,000 2008 series B 'AA-/F1+';

Fitch has also assigned the following ratings to the 150,000,000 Oregon Facilities Authority revenue bonds (PeaceHealth):

--$80,000,000 2008 series C 'AA/F1+';

--$70,000,000 2008 series D 'AA/F1+'.

The ratings are based on the support provided by two separate irrevocable, direct-pay letters of credit (LOCs) issued by: U.S. Bank, National Association for the 2008 series A and 2008 series B bonds; and Wells Fargo Bank, NA for the 2008 series C and 2008 series D bonds. The banks are obligated to make regularly scheduled payments of principal of and interest on the bonds when due, as well as purchase price for tendered bonds. The ratings will expire upon the earliest of: June 26, 2011, the initial scheduled expiration date of the LOCs, unless such date is extended; upon any prior termination of the LOCs; and defeasance of the bonds.

The LOCs provide full coverage of principal, plus, with respect to the U.S. Bank LOC, an amount equal to 34 days' interest and with respect to the Wells Fargo Bank LOC 39 days' interest, in each case at a maximum rate of 12% based on a year of 365 days and purchase price for tendered bonds, while the bonds bear interest in the weekly and daily rate modes. The underwriter and remarketing agent for the 2008 series A, B and D bonds is Goldman, Sachs & Co. and the underwriter and remarketing agent for the 2008 series C bonds is Wells Fargo Brokerage Services, LLC. The bonds are expected to be delivered on or about June 26, 2008.

The bonds initially bear interest at a weekly interest rate, but may be converted to a daily, flexible, LIBOR indexed, term or fixed interest rate mode. While bonds bear interest in the weekly rate mode, interest payments are the first business day of each month, commencing July 1, 2008. During the daily and weekly mode, holders may tender their bonds on any business day, provided the trustee and remarketing agent are given requisite prior notice of the purchase. The bonds are subject to mandatory tender: (1)upon conversion of the interest rate; (2) on the substitution date; (3) on the fifth business day prior to the expiration date of the LOC; (4) on a business day not more than 14 days after the Trustee's receipt of notice of the occurrence of an event of default under the reimbursement agreement and a direction to cause a mandatory tender of the bonds;(5)on a business day not more than five days after the Trustee's receipt of notice of the non-reinstatement of the interest component of the LOC; and (6) on any business day specified by PeaceHealth. Optional and mandatory redemption provisions also apply to the bonds in accordance with the terms of the documents.

Bond proceeds will be used to refinance taxable debt of PeaceHealth that was incurred to redeem certain bonds of the Oregon Facilities Authority issued to finance or refinance the costs of various capital expenditures to PeaceHealth's health care facilities in Oregon.

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.