OVERVIEW Capital Automotive LLC (CARS) is seeking an amendment to its first-lien term loan ($1.5 billion outstanding at Dec. 31, 2012) and $200 million revolving credit facility, which would extend their maturities to 2019/2018 from 2017/2016, reduce the interest rate, and modify financial covenants. Subsequently, CARS is contemplating either issuing $300 million-$325 million of second-lien term notes due 2018 or raising equity in some form, utilizing proceeds to pay down a portion of the first-lien term loan. We are placing our 'B+' issue-level ratings ('3' recovery ratings) on the first-lien term loan and revolving credit facility on CreditWatch with positive implications, given that asset protection of this debt would improve with reduction of the principal outstanding. We are affirming our
