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Moffat County, Colorado <br />Tri-State Generation and Transmission <br />Association Inc.; CP; Rural Electric Coop <br />Credit Profile <br />US$46.8 mil pollution ctrl rfdg rev rmktd 10/2/2017 bnds ser 2009 dtd 02/04/2009 due 03/01/2036 <br />Long Term Rating A/Stable New <br />Tri-State Generation & Transmission Assn unsecd revolv credit <br />Long Term Rating A/Stable Affirmed <br />Tri-State Generation & Transmission Assn ICR <br />Long Term Rating A/Stable Affirmed <br />Tri-State Generation & Transmission Assn RURELCCOO <br />Long Term Rating A/Stable Armed <br />Rationale <br />S&P Global Ratings has assigned its 'A' rating to Moffat County, Colo.'s $46.8 million pollution control revenue bonds <br />(Tri-State Generation and Transmission Association Inc. Project), series 2009 in connection with their remarketing in a <br />term -rate mode. During the term -rate mode, the bonds will bear interest at a fixed annual rate. The outlook is stable. <br />Moffat issued the bonds for Tri-State, and the county can only use the revenues that it receives from the utility to make <br />debt service payments. The financing structure obligates Tri-State to unconditionally pay these bonds' debt service. In <br />addition, the utility issued a note to the county that provides it with a security interest in its assets under its mortgage <br />indenture. Moffafs security interest on the bonds is on par with Tri -State's senior secured debt. <br />A portion of the utility's $750 million revolving credit facility is a letter of credit that supports the liquidity needs of the <br />variable-rate demand obligations' tenders while the bonds are in a weekly variable-rate mode. That mode will end in <br />October. Simultaneous with the conversion to the term -rate mode, Tri-State plans to terminate the letter of credit. The <br />term -rate bonds will be subject to mandatory tender when the term mode expires in five years, which could expose the <br />cooperative to a liquidity event if the bonds cannot be remarketed. However, we view as mitigating factors the relative <br />size of the $47 million of 2009 bonds compared to the entirety of the $3.4 billion debt portfolio; the utility's plans to <br />continue to maintain its revolving credit facility at or near its current level, which more than sufficiently covers the <br />2009 bonds' liquidity exposure; and Tri -State's track record of sound balance -sheet cash. If, before the term mode <br />ends, the utility were to meaningfully reduce its cash balances or the size of its revolving credit facility, we would lower <br />the ratings we have assigned to the utility and its debt obligations because an inability to take out tendered bonds <br />would constitute a default event on the 2009 bonds that would cross -default to the balance of Tri -State's debt covered <br />by its indenture. <br />At the same time, S&P Global Ratings affirmed its 'A-1' rating on the utility's up to $500 million commercial paper <br />program and its 'A' rating, with a stable outlook, on the following: <br />W W W.STANDARDANDPOORS.COM /RATINGSDIRECT <br />SEPTEMBER 11, 2017 2 <br />11 :A,. :O:J vY.,, <br />