Moody's: Workflow Management PD Caa3/LD

Moody's Investors Service said it changed Workflow Management's probability-of-default rating to Caa3/LD from Caa3, reflecting the deemed limited default following the recent conclusion of an amendment that provided for the payment of interest on the company's second-lien loan through March 31, 2010 at a higher coupon and in-kind rather than in cash.

The agency affirmed the corporate family rating at Caa3, senior secured first-lien revolving credit facility due 2010 at Caa1 (LGD2, 23%), senior secured first-lien term loan facility due 2011 at Caa1 (LGD2, 23%) and senior secured second-lien term loan facility due 2012 at Ca (LGD4, 66%).

The outlook remains negative.

The Caa3 corporate family rating reflects the company's high leverage, weak cash flow and liquidity, the agency said.

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