Moody's rates Recycled Paper loans B2, Caa1

Moody's Investors Service said it assigned a B2 corporate family rating to Recycled Paper Greetings, Inc.

Moody's said it also assigned ratings to the company's new $217 million senior secured bank credit facilities, including a $20 million senior secured first-lien five-year revolving credit facility at B2, the new $130 million first-lien senior secured credit facilities at B2 and the proposed $87 million second-lien senior secured term loan facility at Caa1.

The outlook is stable.

The ratings reflect the large debt amount being placed on the company as part of its recapitalization that, in addition to its modest size and narrow business scope, limits the company's ability to withstand any adverse operating developments, Moody's said.

The ratings also recognize the company's experienced management team, flexible outsourced business model, strong service and merchandising capabilities and its alignment with growing retailers, Moody's said.

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