Under Fitch's revised tobacco settlement criteria, 'BB' rated securities may mature beyond the year 2046, so long as such bonds are able to pass a more stringent cash flow stress scenario. To be rated 'BB', the securities must either pass Fitch's current 'BB' stress and pay out by 2046 or withstand Fitch's 'BBB-' cash flow stress through out the rated term of the security.
Under Fitch's previous stress scenarios, all rated bonds needed to be paid in full by 2046. These revised assumptions are effective as of Feb. 21, 2006. This revision addresses the new bond structures and ensures cash flow assumptions are consistent with the ratings assigned throughout the term of the transactions. For more information, see 'Rating Tobacco Settlement Bonds: When the Smoke Clears' dated Jan. 23, 2005 and available on the Fitch Ratings web site at www.fitchratings.com.