Moody's Cuts SFX Entertainment's (SFXE) Probability of Default Rating to 'D-PD' Amid Ch. 11 Filing

Moody's Investors Service (Moody's) downgraded SFX Entertainment, Inc.'s (Nasdaq: SFXE) probability of default rating (PDR) to D-PD from Ca-PD and affirmed SFXE's corporate family rating (CFR) at Ca and the rating of the company's senior secured notes at Ca (LGD3). The rating outlook was changed to stable from negative. The company's speculative grade liquidity rating remains unchanged at SGL-4 (weak).

Subsequent to today's actions, all of SFXE's ratings will be withdrawn as the company has entered bankruptcy proceedings. Please refer to Moody's ratings withdrawal policy on moodys.com.

The following summarizes Moody's ratings and today's rating actions for SFXE:

Issuer: SFX Entertainment, Inc.

Probability of Default Rating: Downgraded to D-PD from Ca-PD

Corporate Family Rating: Affirmed at Ca

Second Lien Senior Secured Notes: Affirmed at Ca (LGD3)

Outlook: Changed to Stable from Negative

Speculative Grade Liquidity Rating: Unchanged at SGL-4

RATINGS RATIONALE

The downgrade of SFXE's PDR follows today's announcement that the company and its U.S. subsidiaries commenced voluntary petitions under Chapter 11 of the United States Bankruptcy Code.

SFX Entertainment's ratings were assigned by evaluating factors that Moody's considers relevant to the credit profile of the issuer, such as the company's (i) business risk and competitive position compared with others within the industry; (ii) capital structure and financial risk; (iii) projected performance over the near to intermediate term; and (iv) management's track record and tolerance for risk. Moody's compared these attributes against other issuers both within and outside SFX Entertainment's core industry and believes SFX Entertainment's ratings are comparable to those of other issuers with similar credit risk.

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