Moody's cuts Goodman Networks

Moody's Investors Service said it downgraded Goodman Networks, Inc.'s corporate family rating to B3, probability of default rating to B3-PD and senior secured debt ratings to B3.

The outlook was revised to stable from negative.

Moody's said the action follows the company's announcement that it plans to issue $100 million of add-on notes to the $225 million 12 1/8% senior secured notes due 2018 that were privately placed in July 2011.

The proposed add-on notes, which were assigned a B3 rating, will rank pari passu with the existing notes and have identical terms (including the same subsidiary guarantees and collateral package).

However, it will also incorporate an amendment that: (a) Permits Goodman to issue and secure incremental senior secured debt; (b) relaxes the fixed charge coverage debt incurrence test; and (c) modifies the definition of EBITDA to allow the add-back of certain one-time non-recurring expenses, the agency said.

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