Fitch Affirms Ratings of CP Notes Issued by CATD Following Covenant Breach.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Fitch affirms the 'F1' ratings of the series A and series B commercial paper notes (CP) issued by the Cooperative Association of Tractor Dealers, Inc. (CATD CATD Confederación Auténtica de Trabajadores Democráticos (Authentic Confederation of Democratic Workers, Costa Rica) CATD Corrective Action Tracking Document CATD Combat Aviation Test Division ). The affirmation follows a breach of the terms and conditions of the program documents as contained in the Cooperative Financing Agreement in CATD, series B. The breach resulted from the application of CATD series B proceeds to pay fees and expenses of the programs, representing less than 0.1% of CP outstandings totaling $299.8 million. Program covenants state that issuance proceeds may only be used to repay maturing CP and make loans to Caterpillar dealers. The CP issued by CATD continues to be fully collateralized by dealer loans in addition to approximately $730,698 in cash accounts. The CP continues to benefit from 100% credit support of the face value of all dealer loans provided in the form of financial guarantee insurance policies issued by MBIA MBIA Montana Building Industry Association MBIA Municipal Bond Insurance Association MBIA Michigan Boating Industries Association MBIA Municipal Bond Investors Assurance MBIA Massachusetts Brain Injury Association MBIA Maryland Business Incubation Association Insurance Corporation (insurer financial strength rated 'AAA' by Fitch) for CATD series A CP and surety bonds surety bond An insurance fee required before a duplicate security is issued to replace one that has been lost. The fee is approximately 4% of the market value of the security to be replaced. issued by Ambac Assurance Corporation Ambac Assurance Corporation A subsidiary of publicly traded Ambac Financial Group that provides financial guarantees for municipal borrowers and for asset-backed and structured issues. (insurer financial strength rated 'AAA' by Fitch) for CATD series B CP. In addition to the credit support provided, CP benefits from 100% liquidity support provided by a syndicate of 'F1' or higher rated banks or financial institutions. Furthermore, the affirmation reflects Fitch's expectation that the breach was isolated and that operational controls have been restored to mitigate any future covenant breach or other operational breakdown. CATD was established in 1981 to issue CP. Proceeds are used to provide unsecured and secured financing for heavy equipment sold by eligible and authorized Caterpillar, Inc. dealers. Fitch's rating definitions and the terms of use Terms of Use are rules set up by the owner of an intellectual property or service to govern how they may be legally used. In many cases, terms of service are used as a contractual agreement between a company and users of a service they provide. 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 Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental are also available from the 'Code of Conduct' section of this site. |
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