Rhode Island’s Tobacco Settlement Financing, R.I., needs more consents

By Angela McDaniels

Tacoma, Wash., July 21 – Rhode Island’s Tobacco Settlement Financing Corp. has received fewer consents than needed from the holders of its series 2015A tobacco settlement asset-backed bonds due on or after June 1, 2019, according to a notice.

As previously reported, the company is seeking consents to amend the indenture governing the bonds and needs the written consent of the holders of all the outstanding bonds. As of 5 p.m. ET on July 16, the holders of 93% of the bonds had given written consent.

The consent solicitation began June 11 and was scheduled to end on July 8 before being extended to July 16.

As of 5 p.m. ET on July 21, the DTC ATOP system previously in effect for the consent solicitation will be closed. The corporation said it reserves the right to continue to solicit the consent of the holders who have not yet voted or who have voted against adoption.

As previously reported, the corporation wants to amend the bonds in order to solve a problem identified by Standard and Poor’s after the bonds were issued in March.

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, according to a previous notice to bondholders.

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

The information and tabulation agent is Bondholder Communications Group (888-385-2663 or RWilliams@bondcom.com).

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