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NEW YORK--([ BUSINESS WIRE ])--Fitch Ratings assigns an 'A' rating to the National Football League's $195 million senior fixed rate notes due 2024, issued through Football Trust.

In addition, Fitch affirms the following ratings:

NFL:

--$1.1 billion senior unsecured notes (G-3 Stadium Finance Program) at 'A+'.

Football Funding LLC:

--$1.4 billion senior secured credit facility at 'A'.

Outstanding Football Trust:

--$2.1 billion senior secured notes at 'A'.

The Rating Outlook is Stable.

KEY RATING DRIVERS

Strong Underlying League Economics: The NFL structure promotes financial stability and competitive balance through a high percentage of revenue sharing and supplemental revenue sharing. Furthermore, the NFL's strength is evidenced by the popularity of the sport, which maintains a robust and stable domestic fan attendance and viewership base. Debt Service is supported by large contractual revenue streams from investment grade counterparties and a collective bargaining agreement (CBA) through the 2020 season. The CBA includes a 'hard salary' cap aiming to provide underlying team cost certainty.

League Oversight and Governance: Fitch views the league's overall debt limit, including the recent increase to $200 million in allowable club debt per team from $150 million, as a conservative policy for its member clubs. In addition to the debt limit and other financial policies, the league has demonstrated willingness to step in and aid 'distressed' franchises.

Solid Legal Covenants: Key structural provisions ensure timely debt service payments. The G-3 program is supported by the Commissioner's 'taxing' power on the member clubs (supported by their revenue streams), thereby providing a diverse pledge. The borrowing facility and notes benefit from the league account that collects national television contracts and services debt prior to distributions to participating clubs.

Long History of Television Contracts: Renewed television contracts run through 2022 with FOX Broadcasting Company (News Corp.; rated 'BBB' with a Stable Outlook by Fitch), CBS (rated 'BBB' with a Stable Outlook), and NBC (rated 'BBB' with a Stable Outlook), and through 2021 with ESPN (Disney; rated 'A' with a Stable Outlook). The NFL also has an agreement in place with DirecTV (DIRECTV Holdings, LLC; rated 'BBB-' with a Stable Outlook) to broadcast 'out-of-market' games on Sunday for three more seasons (including the current season). In addition, the NFL Network has broadcast eight games annually over the past few seasons and will broadcast 13 games this season.

Refinancing Risks Expose Teams to Potentially Higher Costs: The bullet maturities associated with the notes and bank renewals associated with the revolving facility expose clubs to potentially higher interest costs. Low club and league leverage coupled with television contracts through 2022 provide an important mitigant to financial market risks. Fitch notes the G-3 senior unsecured notes are fully amortizing.

Competition from Other Sports and Entertainment: The NFL product continues to be among the most highly coveted sports programming and content. However, the sports sector is inherently vulnerable to discretionary spending from individuals and corporations on tickets, luxury suites, and sponsorships and advertising.

WHAT COULD TRIGGER A RATING ACTION

--A significant decline in fan or corporate interest and support for NFL related content that results in declining television contract revenues;

--Further increases to the league imposed debt limit that result in higher leverage or loan-to-value ratios inconsistent with historical levels and the current rating level.

SECURITY

The 'A' rated senior secured notes and parity senior secured credit facility are secured by each participating club's assets including its pro-rata share of national television contract revenues, membership franchise rights in the NFL and partnership interests in NFL Ventures, L.P.

The 'A+' rated unsecured notes are a direct and general obligation of the NFL and are backed by the commissioner's assessment rights over the member clubs (supported by their revenue streams). National revenues include the following:

--National television contracts;

--Net revenues and royalty distributions from NFL Ventures, L.P. and its subsidiaries.

The subsidiaries include the following:

--NFL Enterprises LLC, which oversees satellite broadcasting, Internet, NFL Network, and other new media ventures;

--NFL Productions LLC, which produces film and video programming and administers related licensing activities;

--NFL Properties LLC, which licenses the League's and Member Clubs' names, nicknames, logos, etc.,

--Any other NFL-affiliated for-profit entity; and

--Portions of base ticket revenues that are pooled and distributed to the Member Clubs.

TRANSACTION SUMMARY

The $195 million senior fixed rates notes will be used to by certain clubs for capital and other corporate purposes. The notes will mature in 2024. 21 clubs participate in the Football Trust borrowing program and 20 clubs participate in the senior secured credit facility.

For additional information related to the NFL's credit and the aforementioned key rating drivers see 'Fitch Rates NFL's Credit Facility 'A'; Affirms Outstanding 'A+/A'; All Outlooks Stable' dated July 18, 2012 and 'Fitch Affirms NFL's League Notes at 'A+' & Borrowing Programs at 'A'' dated May 23, 2012, available at '[ www.fitchratings.com ]'.

The senior unsecured notes were used by the NFL to provide additional private funding for the construction of new football stadiums through support of the NFL's G-3 Stadium Finance Program. Fitch notes that there will likely be additional league level funding for the G-4 program to fund a portion of the stadium development costs for clubs currently pursuing new and/or renovated facilities. The NFL is a not-for-profit unincorporated association of 32 member teams and was originally founded in 1920 with 18 franchises.

Additional information is available at '[ www.fitchratings.com ]'. The ratings above were solicited by, or on behalf of, the issuer, and therefore, Fitch has been compensated for the provision of the ratings.

Applicable Criteria & Related Research:

--'Rating Criteria for Infrastructure and Project Finance' (July 11, 2012);

--'Rating Criteria for U.S. Sports Facilities, Leagues, and Teams' (Aug. 9, 2012).

Applicable Criteria and Related Research:

Rating Criteria for Infrastructure and Project Finance

[ http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=682867 ]

Rating Criteria for U.S. Sports Facilities, Leagues, and Teams

[ http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=685897 ]

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