U.S. check printer Harland Clarke Holdings is issuing $250 million senior secured notes due 2018. It originally intended to issue $295 million senior secured notes due 2019, for which we assigned issue-level and recovery ratings on May 11, 2012. Although interest rates are higher than originally expected, we are affirming our 'B+' issue-level rating with a recovery rating of '3' on the new notes. We are revising our rating outlook to negative based on the company's second-quarter operating guidance, which was below our expectations, and its still-meaningful intermediate-term debt maturities. The negative rating outlook reflects the company's still-significant debt maturities in 2014 and in 2015, the potential for cash flow to decline if these issues are refinanced because interest expense
