Fitch Rts Birmingham Airport Auth, AL Airport Bonds,Ser 03-A 'AAA/F1+'

October 21, 2003 11:18 AM US Eastern Timezone

Fitch Rts Birmingham Airport Auth, AL Airport Bonds, Ser 03-A 'AAA/F1+'

NEW YORK--(BUSINESS WIRE)--Oct. 21, 2003--Fitch Ratings assigns a
'AAA/F1+' rating to Birmingham Airport Authority's $20.8 million airport
revenue refunding bonds, series 2003-A (non-AMT). The long-term 'AAA'
rating assigned to the bonds is based on the support of a municipal bond
insurance policy provided by Financial Security Assurance, Inc., (FSA),
which insures scheduled payments of principal of and interest on the
bonds, effective as of the date of issuance of the bonds.
The insurance policy will extend to the maturity date of the bonds, which
is July 1, 2023. The short-term 'F1+' rating assigned to the bonds is
based on the support of a standby bond purchase agreement (SBPA), provided
by Dexia Credit Local, acting through its New York Agency. Fitch also
assigns an 'A-' underlying rating to the above noted series 2003-A
(non-AMT) debt.

The SBPA provides for the payment of the purchase price of tendered bonds
during the weekly mode and is sized to cover the principal portion of the
purchase price and 35 days of interest at the maximum rate of 12%, based
upon a year of 365 days. The SBPA will expire on the stated expiration
date of Oct. 22, 2006 or upon the occurrence of other events of
termination as specified in the SBPA. The short-term rating on the bonds
will expire upon any expiration or termination of the SBPA. The
underwriter and remarketing agent for the bonds is Sterne, Agee & Leach,
Inc. The bonds are expected to be delivered on or about Oct. 22, 2003.

The bonds initially bear interest in a weekly rate mode, but may be
converted to a term interest rate mode. While bonds bear interest in the
weekly mode, interest is payable on the first business day of each month.
During the weekly mode bondholders have the option to tender their bonds
on any business day, following required notice to the trustee, First
Commercial Bank. The bonds are subject to mandatory tender: (1) on
conversion of interest mode; (2) on the last day of a term rate period;
(3) on any date proposed for delivery of a Substitute Bond Insurance
Policy; (4) upon the termination, expiration or substitution of the SBPA,
including following the tender agent's receipt of notice from the bank of
an event of default under the SBPA stating that the SBPA will terminate in
30 days. Mandatory and optional redemption provisions also apply to the
bonds pursuant to the terms of the documents.

The proceeds of the sale of the series 2003-A bonds will be used to refund
certain of the Birmingham Airport Authority's outstanding airport revenue
bonds.

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