Tobacco Settlement Financing, R.I., seeks to amend series 2015A bonds

By Susanna Moon

Chicago, June 11 – Tobacco Settlement Financing Corp. of Rhode Island said it is seeking holder consents to amend a number of series 2015A asset-backed bonds with maturities beginning June 1, 2019.

The amendment would solve a problem identified by Standard and Poor’s after the bonds were issued in March, according to a notice to bondholders.

The issue involves the impact of a hypothetical default of the series 2015B bonds related to applying a stress test to the series 2015A bonds as part of S&P’s rating process.

That test involved a hypothetical future bankruptcy of the largest tobacco manufacturer that signed the 1998 Tobacco Master Settlement Agreement, Philip Morris USA.

The amendment to the notes indenture requires the written consent of the holders of all outstanding series 2015A bonds maturing on or after June 1, 2019, the notice said.

Holders are asked to send consents by July 8.

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