Moody's cuts American Color probability-of-default rating

Moody's Investors Service said it downgraded American Color Graphics, Inc.'s probability-of-default rating to Ca/LD from Ca while affirming its Ca corporate family rating and the Ca rating (LGD4, 63%) on $280 million of senior secured second-priority notes due 2010.

The actions follow the company's announcement that it received noteholder consent to defer its upcoming interest payment.

The outlook is stable.

According to the agency, the downgrade reflects Moody's view that any missed, delayed or deferred debt payment obligation constitutes a default event even if it is permitted by noteholders.

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