S&P cuts Brand Services

Standard & Poor's said it lowered its corporate credit rating on Brand Services Inc. to B from B+, the senior secured debt to B from B+ and the subordinated debt rating to CCC+ from B-.

The outlook is negative, pending a review of the company's amended financial covenants in its bank credit facility.

S&P said the rating action follows Brand's disclosure that during the second quarter the company violated the minimum interest coverage and maximum leverage ratio under its senior secured credit facility. Although it received a waiver for the second quarter violation, the company projects noncompliance with these covenants for the period ended Sept. 30, 2004.

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